Chapter 4. Food and Beverage Services
Peter Briscoe and Griff Tripp
Learning Objectives
- Describe the origins and significance of the food and beverage sector
- Relate the importance of the sector to the Canadian economy
- Explain the various types of food and beverage providers
- Discuss differing needs and desires of residents and visitors in selecting a food and beverage provider
- Examine factors that contribute to the profitability of food and beverage operations
- Discuss key issues and trends in the sector including government influence, health and safety, human resources, and technology
Overview
According to Statistics Canada, the food and beverage sector comprises “establishments primarily engaged in preparing meals, snacks and beverages, to customer order, for immediate consumption on and off the premises” (Government of Canada, 2012). This sector is commonly known to tourism professionals by its initials as F&B.
The food and beverage sector grew out of simple origins: as people travelled from their homes, going about their business, they often had a need or desire to eat or drink. Others were encouraged to meet this demand by supplying food and drink. As the interests of the public became more diverse, so too did the offerings of the food and beverage sector.
In 2014, Canadian food and beverage businesses accounted for 1.1 million employees and more than 88,000 locations across the country with an estimated $71 billion in sales, representing around 4% of the country’s overall economic activity. Many students are familiar with the sector through their workplace, because Canada’s restaurants provide one in every five youth jobs in the country — with 22% of Canadians starting their career in a restaurant or foodservice business. Furthermore, going out to a restaurant is the number one preferred activity for spending time with family and friends (Restaurants Canada, 2014a).
Food and Beverage Sector Performance
Look at Figure 4.1, which illustrates the percentage of total food dollars spent in restaurants in Canada and the United States over several years. As you can see, Americans spend significantly more of their total food dollars in foodservice establishments than in grocery stores, and in Canada we spend more of our total food dollars in the grocery store than we do in foodservice operations. It’s worth noting that Americans do not have an equivalent federal sales tax on meals comparable to our GST on foodservice sales, although there does exist in some states a sales tax on meals and alcoholic beverages (State Sales Tax Rates, 2015). This, combined with a larger population, cheaper food distribution costs, and other factors can often mean that it’s less expensive to dine out in the United States than in Canada.
For a perspective on how sales are distributed across the country by province, and how different foodservice operations perform in terms of revenue (sales dollars collected from guests), look at Tables 4.1 and 4.2.
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