Quebec Restaurants Face a “COVID-Like” Slowdown: What’s Happening and What’s Next?
Quebec’s restaurant industry, still reeling from the pandemic, is facing a new wave of challenges. A recent report highlights a significant slowdown during the typically bustling holiday season, driven by economic uncertainty and shifting consumer habits. Restaurateurs are describing the current climate as feeling eerily similar to the height of the COVID-19 crisis.
The Austerity Effect: Corporate Events and Consumer Spending
The core issue isn’t a complete lack of customers, but a change in how they spend. Corporate holiday parties, a major revenue source for many restaurants, have been scaled back dramatically. Instead of open bars and lavish meals, companies are opting for capped budgets, coupon systems, or even bringing celebrations in-house to save money. Sébastien Muniz, co-owner of Tapeo and Mesón in Montreal, aptly calls it “almost like a COVID number two.”
This trend reflects a broader economic anxiety. Consumers are also tightening their belts, reducing spending on discretionary items like dining out. A recent study by Restaurants Canada showed a 2.5% decrease in restaurant sales across the country in December 2025, with Quebec experiencing a slightly steeper decline of 3.1%.
Beyond Corporate Budgets: Changing Consumer Habits
The shift isn’t just about less spending; it’s about where people are spending. Nikkeshan Malarraj, owner of Le Coin G bistro, notes a significant drop in mid-week business. “The peak is now concentrated on Thursday through Saturday,” he explains. “Customers who used to dine out every two weeks are now doing so only once a month.”
This suggests a fundamental change in dining habits, driven by the rising cost of living. Consumers are prioritizing essential expenses and reserving restaurant meals for special occasions. Guillaume Brière, VP of brand direction for Groupe Grandio, observes a “migration” of customers within their restaurant group, with more people opting for breakfast or lunch instead of dinner.
The Impact of Alcohol Consumption & Inflation
A surprising factor contributing to the downturn is a decrease in alcohol consumption. While welcomed by public health officials, this trend is hurting restaurant bottom lines. Restaurants rely heavily on beverage sales, and a decline in alcohol orders significantly impacts revenue. Malarraj notes his beer supplier was shocked by the drop in sales compared to the previous year.
Of course, persistent inflation remains a major headwind. Rising food costs, labor shortages, and increased operating expenses are squeezing restaurant margins, making it harder to offer competitive prices.
Looking Ahead: Potential Future Trends
Several trends are likely to shape the future of Quebec’s restaurant industry:
- Value-Driven Menus: Restaurants will need to focus on offering affordable options and value-driven menus to attract budget-conscious diners. Expect more fixed-price meals and promotions.
- Experiential Dining: To justify higher prices, restaurants will increasingly emphasize unique dining experiences – think themed nights, chef’s tables, and interactive events.
- Technology Integration: Online ordering, delivery services, and digital loyalty programs will become even more crucial for reaching customers and streamlining operations.
- Ghost Kitchens & Virtual Brands: The rise of ghost kitchens (delivery-only restaurants) and virtual brands will continue, offering lower overhead costs and greater flexibility.
- Government Support: The industry is actively lobbying for government assistance, such as tax breaks or temporary relief measures, to help navigate the current economic challenges.
The Looming Restaurant Closures
The situation is serious enough that experts are predicting widespread closures. A recent forecast from Dalhousie University estimates that at least 4,000 restaurants across Canada will close their doors in 2026. This underscores the urgent need for both industry innovation and government support.
FAQ
- What is driving the slowdown in the Quebec restaurant industry? Economic uncertainty, reduced corporate spending, and changing consumer habits are the primary factors.
- Are all restaurants affected equally? Mid-range restaurants appear to be particularly vulnerable, as consumers trade down to more affordable options.
- What can restaurants do to adapt? Focus on value, create unique experiences, embrace technology, and seek government support.
- Is this a temporary situation? Experts believe the challenges will persist for the foreseeable future, requiring long-term adaptation strategies.
Did you know? The restaurant industry is one of the largest employers in Canada, providing jobs for over 1.2 million people.
Want to learn more about the challenges facing the hospitality industry? Visit Restaurants Canada for the latest research and resources.
Share your thoughts! What are your experiences with dining out lately? Leave a comment below and let us know.
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