The restaurant sector employs thousands of Quebecers and showcases our culinary expertise. However, serving good food and turning over tables is no longer enough to ensure financial success. Find out more about tools that can generate sustainable profitability even though the sector faces challenges.
The main challenges in the restaurant sector
In the current climate, restaurant owners must navigate the following challenges in particular.
- Pressure on costs. The cost of food and beverages, energy, insurance, technology and delivery platforms have all increased in recent years.
- Workforce shortage. The ARQ’s 2025 salary and labour survey confirms that, on average, 11.3% of full-time positions and 8.4% of part-time positions in the sector are empty.
- New spending habits. Customers are still visiting restaurants, but they’re paying more attention to prices and perceived value.
- Increasingly expensive leases and fixed costs. A prime location is still an advantage, but it must be backed by sufficient sales.
These challenges are very real, but they’re not inevitable. If you closely monitor your indicators and quickly adjust your decision-making, you’ll be better equipped to stay on track. In a sector characterized by slim profit margins, every action counts. Over time, the combination of each of your actions will allow you to sustainably improve your results.
Key indicators for measuring your restaurant’s profitability
A busy restaurant is an encouraging sign, but it doesn’t guarantee a healthy profit margin. What matters is your ability to transform your sales into actual profits.
In order to make better decisions, regularly track these indicators.
- Gross margin
- Food costs
- Labour costs
- Available liquidity
- Working capital
- Profitability by service
- Stock turnover
For example, several successful restaurants maintain food costs of between 28% and 35% of sales, while labour costs are often close to 30%. These reference points can help you to pinpoint which factors must be improved.
If you group these indicators in a dashboard, you’ll clearly see where you’re making a profit, where you can increase your earnings and which actions would really make a difference.
Tangible actions to boost profitability
Several actions can have a direct effect on your establishment’s profitability.
- Make the most of your menu by focusing on the most profitable dishes.
- Where required, review your pricing strategy. Certain targeted adjustments can improve your margins without jeopardizing the client experience.
- Reduce food waste. Track your losses to reduce waste.
- Improve your inventory management. Avoid overstocking and inventory shortage.
- Negotiate with your suppliers (alone or with other restaurant owners).
- Optimize your opening hours based on customer traffic.
- Control your fixed costs. Spending that was relevant a few years ago may no longer be necessary.
When considered separately, each of these tools can appear insignificant. However, when you combine them, they can make a big difference.
Three signs that your restaurant is on track
There are three signs that you’re managing your restaurant effectively.
- Your gross margin is stable, even during quiet periods.
- You know which dishes are the most profitable and which are not.
- You have a liquidity reserve to tide you over during quiet months with confidence.
One or two of these signs don’t apply to you? This is the right time to reach out for support.
RCGT can support you every step of the way
No single factor can determine a restaurant’s profitability. Operations, tax obligations, human resources and financing are all closely connected. This is why a multidisciplinary approach generally delivers better results.
RCGT can support you with each step of your process.
- Analyzing your situation.
- Building dashboards that reflect your reality.
- Optimizing your costs and processes.
- Structuring your financing.
- Tax planning.
- Developing a growth strategy.
- Planning a business succession or sale.
Whatever stage you’ve reached, our teams can tailor solutions to your needs.
Why reaching out for help early makes a difference
In the restaurant sector, the unexpected is part of everyday life. A supplier could adjust their rates, a key employee could accept a new role or a month could be slower than usual. When you closely monitor your situation, you’ll have the flexibility to seize opportunities and quickly get back on track.
Don’t hesitate to contact an expert. The best-prepared business owners build a support network before the pressure becomes unbearable. Contact our advisors today.
This article was written by Guyllaume Amiot.
