Canada Foodservice Market - Growth, Trends, and Forecasts (2023 - 2028)

Canada Foodservice Market - Growth, Trends, and Forecasts (2023 - 2028)

The Canadian foodservice market is projected to register a CAGR of 4.55% during the next five years.

The increasing frequency of dining out and time-pressed schedules are primarily driving the Canadian foodservice market. Full-service restaurants are witnessing high growth rates. Quick-service or full-service restaurants hold a prominent share of the overall foodservice business in Canada. The Canadian foodservice business is constantly growing due to Canada’s economy, which is operating at total capacity. According to the Food Service and Hospitality report of May 2022, MTY group and Tim Horton's are the most prominent food service chains in Canada.

People, especially baby boomers and millennials, have become very health-conscious and want their food to be healthy and fresh. This is why full-service restaurants are growing in the region. Also, university and college-going students may not have the time to sit and eat proper meals. Therefore, they prefer takeouts and quick food services. Due to this, fast-food restaurants are growing in Canada. To expand the business, full-service restaurant companies are forming mergers and acquisitions. For instance, in November 2021, Recipe Unlimited Corporation, Canada's oldest and largest full-service restaurant company, acquired Plant Powered Ventures Ltd, which operates the original five Fresh-branded plant-based restaurants in Ontario.

Global food service brands, such as Starbucks, McDonald's, and Domino's, are rapidly increasing in Canada owing to the large population of young people in the country. Students going to universities and colleges always prefer to have breakfast and lunch quickly and need restaurants near the college premises. Owing to this factor, food service brands are opening new food outlets near every college and university. Yum! Brands, one of the largest foodservice providers in Canada, along with brands such as KFC and Pizza Hut, is embarking on huge expansion plans across the country to effectively penetrate its presence in targeted cities, such as Toronto, Vancouver, Calgary, Montreal, Halifax, Ottawa, and Edmonton. Companies such as McDonald’s and Starbucks Corporation are also undertaking expansion plans, rolling out innovative menus, and enhancing their portfolio to gain a stronghold in this lucrative market. For instance, according to Starbucks Corporation, the number of licensed and company-owned stores in Canada increased and reached 1,518 in 2021. Similarly, Tim Hortons’ restaurants in Canada reached around 3,802 in 2021.

Canada has a population with diversified ethnic origins. Apart from Canadians, the country is home to a significant population that has migrated from other countries like China, India, Nigeria, Iran, and South Korea. With a large foreign-born population, consumers are keen to experience dishes from cultures other than their own. They prefer to experience different cultures through food, directly influencing them to seek out ethnic food restaurants. Moreover, the consistent rise of immigrants settling across the country over the past few decades has developed a space for multi-national cuisines for the residents of Canada. Many ethnic cuisine restaurants, like Afghan Cuisine restaurant, Leng's Chinese food, and Walia Ethiopian restaurant, are providing their native cuisines in Canada. Owing to the above-mentioned factors, a significant share of the migrant population has successfully set up restaurant units to offer their ethnic cuisines to Canadian consumers.

The Canadian food service industry is highly competitive due to the substantial number of small, independent, single-location restaurants that operate in the market. The major players in the market include McDonald's Corp., Restaurants Brand International, and Starbucks Corporation. Both global and local players are gaining popularity and continue to expand in the country. Product innovations and partnerships are the key strategies being adopted by players operating in the market.

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