B.C. restaurants squeezed by rising costs: Report

B.C. restaurants squeezed by rising costs: Report

Published 10:46 am Wednesday, September 16, 2026

B.C.’s restaurant industry is absorbing cost pressures more sharply than the rest of the country, according to new data from EconoLease’s 2026 Hospitality Operator Report.

The report reveals that the province’s hospitality sector is under financial pressure, due to tariffs, costs of upgrades to cooking equipment and disproportionately high startup costs.

The report, released Sept. 15, surveyed 250 Canadian foodservice and hospitality operators and found that 90 per cent of B.C. operators have raised menu prices in the past 12 months. This is well above the 80 per cent national rate, and 53 per cent say they’ve already raised prices once and plan to do so again in the next year, compared with 49 per cent nationally.

According to the report, the tariffs are weighing heavily on the province’s restaurant owners, with more than a quarter naming tariffs or supply chain disruptions among the top threats to their business over the next year.

More than half of the operators surveyed in the province (53 per cent) also said that rising food and beverage costs are the next big one on the list.

Recession risk, labour shortages, rising wages and declining consumer spending round out the list of pressures operators are watching most closely. B.C. operators reported a median overall cost increase of 7.5 per cent over the past year, in line with the national figure, driven primarily by labour and wages, food and beverage costs, and rent and occupancy.

Both rent and labour pressures are running higher in B.C. than elsewhere in Canada: 45 per cent of B.C. operators cited steep rent and occupancy increases, compared with 32 per cent nationally, while 58 per cent pointed to labour and wages, compared with 55 per cent nationally.

The study also found that cooking equipment, ovens, ranges and fryers, is one of the biggest operational bottlenecks for B.C. restaurants, cited by 34 per cent of operators, followed by coffee and beverage equipment, and refrigeration.

Most restaurant operators noted that most failure-prone equipment is also the most critical to daily operations. They said that refrigeration, cooking equipment, and point-of-sale and technology hardware are the systems they can least afford to lose.

According to the report, a typical B.C. operator spends a median of $22,500 a year just on equipment maintenance and repair, matching the national median. Cost is now a deciding factor in whether upgrades happen at all, with most of them saying they want to upgrade but cannot afford it.

The report showed that over the past year, almost 60 per cent of B.C. operators delayed a planned upgrade because of cost, and another 10 per cent cancelled one outright, both notably higher than the national delay rate of 46 per cent.

More flexible financing options would ease the burden for most operators, stated the report. Ninety-two per cent of B.C. operators said the ability to change or upgrade equipment at any time, without paying full price upfront, would help their operations run more smoothly, considerably higher than the 80 per cent national average.

The study also found that B.C. stands out as one of the most expensive places in Canada to launch a hospitality business. The median startup cost in the province is $537,500, well above the $325,000 national median.

More than a third of B.C. operators say their actual startup costs exceeded their original estimate by 10 per cent or more, compared with 26 per cent nationally.

That higher startup cost also translates into a longer road to profitability. Only 32 per cent of B.C. operators turned a profit within their first year, which is 37 per cent below the national rate. A large number of operators took two to four years or more to break even.

However, despite the financial strain, the report also suggests that the outlook remains largely positive, with 84 per cent of B.C. operators saying they feel “optimistic” about the year ahead.