Total sales at Canadian food services and drinking places rose 0.1% in July to 8.52 billion Canadian dollars, marking a fifth consecutive monthly gain and a 6.8% increase from a year earlier, according to a Statistics Canada release.
The agency also reported that menu prices were 3.2% higher than in July 2024, while prices for alcoholic beverages served in licensed establishments rose 3.4%.
The modest July increase keeps a steady climb in place through spring and midsummer. Full-service restaurants posted the largest advance among categories, with seasonally adjusted sales up 0.4% from June.
Special food services, which include caterers and mobile vendors, rose 1.4%. Limited-service eating places slipped 0.3%, and drinking places fell 1.9%.
Year over year, every major category except bars showed gains, with full-service up 7.3% and quick-service up 6.5%.
Regional performance was mixed. Five provinces recorded higher sales in July. Ontario saw the biggest dollar increase, up 0.3% on the month, followed by Manitoba at 1.0%.
British Columbia registered the largest dollar decline, down 0.3%. Among the territories, the Northwest Territories rose 3.9%.
Statistics Canada noted that figures are seasonally adjusted current dollars and are subject to revision as more data come in.
The combination of higher nominal sales and moderate menu inflation suggests demand is holding up despite tighter household budgets.
With year-over-year sales growth outpacing the reported change in restaurant prices, the sector likely benefited from some increase in real volumes or a shift toward higher-ticket dining, though differences between current-dollar sales and price indexes make direct comparisons approximate.
Persistent growth in discretionary services can help sustain employment in hospitality and adjacent industries, even as operators work through rising labor and occupancy costs.
Canada tourism GDP rises 1.3% as domestic travel powers Q2” and “Canada’s GDP rose 0.2% in July as goods producers rebounded,” which together point to a macro backdrop that still supports restaurant demand.
For restaurants, the split between full-service and limited-service is telling.
Full-service dining has been rebuilding traffic as group outings and tourism normalize, while quick-service chains appear to be encountering a more price-sensitive consumer.
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The decline at drinking places fits with a broader trend of cautious discretionary spending late in the month and the influence of promotional activity that can swing bar receipts from one month to the next.
Investors will be watching whether this pattern extends into late summer, when patio season typically fades and input costs for food and beverages can shift.
July’s 3.2% annual increase for restaurant food was well below last year’s peaks but still enough to test price tolerance, particularly for lower-income households.
Operators that can nudge check sizes through add-ons or loyalty programs without pushing customers away may continue to defend margins.
Those with higher exposure to alcohol sales face a tougher balance if bar traffic remains soft while drink prices climb.
Provincial differences also matter for publicly traded chains and suppliers.
Ontario’s incremental growth can help brands with dense urban footprints, while Manitoba’s stronger monthly rise highlights the value of diversified regional networks.
A slight monthly dip in British Columbia may reflect localized economic pressures or timing effects from tourism flows.
Franchise systems that rely on broad national exposure can smooth these swings, but single-province concepts may feel them more acutely.
A services-heavy spending mix can keep certain inflation components sticky, which would argue for caution as central bankers gauge the trajectory of rate cuts.
At the same time, the modest pace of nominal growth suggests restaurants are expanding without the kind of overheating that would reignite price pressures.
The next few releases will show whether July’s softness at quick-service counters and bars was a blip or the start of a cooler late-summer pattern for dining out.
