The co-owners of Fresh From The Oven, a sweet shop and restaurant in Greenwood, NS, decided to close their business last month after discovering their rent was being cut in half. “Our profit margins [are] it gets smaller and smaller at each restaurant,” said co-owner Liz Stevens. What will that do?’ Stevens said the prices of everything from dish detergent to chicken breasts have risen significantly in recent months. Morning Info – NS7:31NS restaurants face rising costs, labor shortages There is a long and varied list of challenges restaurateurs face. While restaurants have been busier this summer, rising costs and continued labor shortages are shrinking profit margins, says Restaurant Nova Scotia executive director Gordon Stewart. Stevens and her partner and son-in-law, Dan Krautzman, received a $40,000 small business loan from the federal government, which Stevens said is now a “mountain of debt” for restaurateurs. “At the end of the day, I didn’t want to fail,” he said. “And I didn’t want to let the community down at the same time.” Gordon Stewart is president of the Nova Scotia Restaurant Association. (Alexander Quon/CBC) Gordon Stewart, executive director of the Nova Scotia Restaurant Association, said state support has helped get restaurants through the lockdown. “Now there’s nothing, so it’s every man for himself,” Stewart said. “They have less money to pay rent, they have less money to pay for food, everything overall.” Stewart said food costs for restaurants increased about 18 percent from April 2021 to April 2022. “That’s a huge leap,” he said. “[It’s the] the biggest we’ve ever seen in our history.” Stewart said he expects more restaurants in the province to close for good as the cost of rent, food and supplies continue to rise and labor shortages plague the industry. He said some restaurants had to pass on some of their increased costs to customers to stay profitable. Mona Theriault has worked at Green Elephant for nine years and owned the restaurant for four. (Simon Smith/CBC) Mona Theriault, owner of the Green Elephant Cafe in Kingston, said she hasn’t raised her food prices in nearly two years. Many of her clients are seniors on fixed incomes, she said, and she “fights it” as hard as she can. “I’ve been very fortunate that I haven’t had to do drastic price increases,” Theriault said. “That should change soon enough.” He said the biggest cost increase he’s seen is packaging. She started charging for takeout cups, which she said cost her $0.60 each.
Staying busy, reducing key wastage
Theriault credited her customers for keeping the restaurant busy and her staff for limiting food waste to keep costs down. “I’m very proud that we managed to not only survive but also grow during it,” she said. “We can do everything 10 ways until Sunday, but unless people choose to walk through the door, then we’re not here.” Stewart said he expects food prices to settle eventually, but in the meantime restaurants will have to change the way they do things. “New restaurants should see, ‘What size [do] are we opening?” he said. “A much smaller size is much better controlled.” He said restaurant owners should review their current rental situations to see if there is a “better deal” elsewhere.
