Canadians Will Dine Out Less in 2024 in Wake of Rising Food Prices: Report

Grocery prices have been rising significantly in Canada, largely due to inflation. (The Canadian Press/Nathan Denette)

The rising cost of food has many Canadians looking for ways to make their money stretch further in 2024, a new report shows.

The end of year report from the Agri-Food Analytics Lab at Dalhousie University found that 80.3 percent of Canadians expect food prices to rise in 2024—and that will encourage many households to find new ways to save money.

One of the chief ways families will cut back on food spending in 2024 is by eating out less often, according to the report, which is based on a survey of 5,000 adult Canadians.

A total of 38.3 percent of Canadians say they are planning to eat out less often in the coming year while an additional 12.2 percent say they will not eat out at all.

While that increased thriftiness will benefit the pocketbooks of Canadians, it will do little to help an already struggling restaurant industry.

A recent report from Restaurants Canada revealed that more than half of Canadian restaurant owners are either operating at a loss or are barely breaking even.

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Thirty-four percent of restaurants were in the red as of March this year compared to 7 percent prior to the COVID-19 pandemic, while 17 percent are only just breaking even compared with 5 percent four years ago. The report, released at the end of October, said only 12 percent of restaurant owners enjoy a double-digit profit margin.

Rising costs across the board are heavily impacting the bottom line of restaurants country-wide, causing owners to raise menu prices at record rates, the report said. The cost of food in particular is forcing menu prices to increase, and restaurants’ own costs are rising even more, forcing owners to walk a fine line of trying to recoup costs while not angering customers.

Canada foodservice industry analyst Vince Sgabellone predicted in the report that the rising menu prices would cause many consumers to make adjustments to their spending at restaurants.

“Lower income consumers will feel the pricing pressures more, and thus will adjust their foodservice spending sooner and more drastically,” Mr. Sgabellone said in the report.

“Others will moderate their restaurant spending by downsizing their meals, cutting back on extras, or searching for a deal. This will create downward pressure on average eater checks, even as menu prices rise.”

His prediction seems to be right on the money based on the results of the new food spending survey.

The Agri-Food Analytics Lab report indicated that of those who do intend to go out to eat, 39.4 percent will choose budget-friendly restaurants while 24.2 percent will not order side dishes or alcohol to keep the cheque lower. Another 13.7 percent will split meals to reduce costs.

Shopping Habits

Canada’s 2024 Food Price Report, released earlier this month by the lab, predicts that the price of groceries will increase by an average of $701.79 per family of four in the new year. And Canadians are planning to tighten their belts on food spending to compensate.

“Our latest research highlights a growing concern among Canadians about rising food prices and their consequent shift in food consumption habits,” Agri-Food Analytics Lab director Sylvain Charlebois said in the report. “From increasing reliance on promotions and loyalty programs to a heightened focus on food waste reduction, Canadians are adapting in diverse ways to manage their food expenses.”

One of the ways households are adapting is by changing their food shopping habits, the report shows.

A total of 43.3 percent of those polled say they will actively look for promotions in the new year to cope with higher food prices, while 34.6 percent will use more coupons and 33.6 percent will use loyalty programs more often. A total of 30.6 percent say they will shop at different stores to get better deals.

What Canadians buy will also be impacted by the rising cost of food, with many saying they will cut back on particular products, the survey found. Snacks and convenience foods are the No. 1 choice for cutbacks in 2024, with 43.2 percent saying they will buy less of both.

Meat and alcohol are also on the chopping block, according to the report, with 30.5 percent and 28.2 percent respectively saying they will limit the amount they purchase. Fish and seafood are next on the list at 16.3 percent, followed by fresh produce and dairy products, which both came in at 12.9 percent.

Limit Food Waste

A change in shopping habits is not the only resolution Canadians are making for 2024. They also plan to limit how much food they waste.

Forty-eight percent of Canadians will turn to meal planning and shopping lists in a bid to reduce waste, while 36.2 percent intend to eat leftovers more often, the report found.

A total of 32.7 percent of respondents say they will use food preservation methods like freezers and canning more often, 24 percent will buy food products with a longer shelf-life, and 21 percent will serve smaller portion sizes in the new year.

Mr. Charlebois said the shift in food priorities may appear to be about increasing costs, but added that it is “more than just economic.” He said it is “a cultural shift in how we approach our food choices and consumption patterns.”

Those changes are reflected in Canadians’ overall approach to food in 2024, with some survey respondents saying they plan to eat healthier and make better food decisions in the new year.

Nearly 15 percent of Canadians said they will eat healthier and make better food choices, while 6.4 percent plan to reduce consumption of processed foods and specific ingredients such as sugar. Only 25 percent of respondents had no food resolutions planned for the new year.