St. Patrick’s Day is emerging as a key test for Canada’s restaurant and bar sector as shifting consumer habits continue to weigh on alcohol demand. Industry data and interviews point to a sustained decline in both alcohol sales and consumption across the country.
BNN Bloomberg spoke with Kelly Higginson, president of Restaurants Canada, about how reduced drinking, rising costs and changing preferences are reshaping restaurant revenues and consumer behaviour.
Key Takeaways
- Alcohol’s share of restaurant revenue has declined significantly over the past decade, reflecting a structural shift in consumer behaviour.
- Per-person spending at table service restaurants has fallen in recent years, even when adjusted for inflation and population growth.
- Younger Canadians are drinking less frequently, with a growing share reporting no alcohol consumption in a given week.
- Health concerns, affordability pressures and lifestyle preferences are all contributing to reduced alcohol consumption across demographics.
- Restaurants are adapting by offering smaller portions, premium experiences and expanding non-alcoholic beverage options.
Read the full transcript below:
ROGER: On St. Patrick’s Day, new data from Statistics Canada shows alcohol sales have been slowing. So there will be a test for bars and restaurants today as broader shifts toward drinking less start to weigh on sales. Here to discuss this is Kelly Higginson, president of Restaurants Canada. Kelly, thanks very much for joining us.
KELLY: Good morning. Thanks for having me.
ROGER: How noticeable is this shift?
KELLY: Yeah, it’s considerable, for sure. We’ve seen this decline over the last four years. What I would say is that it’s happening at the same time as we’ve seen a dramatic increase in our input costs over the last five years. So we’ve continually seen a drop. At this point, 21.1 per cent of total revenues in 2013 were related to alcohol sales, but that number has dropped to 17.1 per cent in 2023, which is the latest available data. So that’s a pretty considerable drop in the last three to four years.
We’re also seeing it on a per-person basis at table service restaurants, with a decline from about $1,100 per person in 2019 to about $1,000 in 2025, when adjusted for population growth and inflation.
PETER: Kelly, you’ve given us the percentage of alcohol, but can you narrow it down to a per-customer amount? And also, what’s the next highest-margin item on a typical restaurant menu? Because I know alcohol is the highest margin — what’s next, and what can operators promote?
KELLY: This is where we’ve got the challenges. Spending at table service restaurants declined from $1,170 per person in 2019 to $1,050 in 2025, so that is a pretty significant drop.
To your point, our highest costs are really in food, and margins there are tight. When we look at the increase in the cost of food over the last number of years, that’s really challenging operators. The ability to find profit has become more and more limited.
ROGER: Is this drop solely because of price — people just don’t have the money — or are they also just not drinking as much? And is it across the board, from smaller restaurants to high-end establishments?
KELLY: It’s a real mix. We’ve got 74 per cent of Gen X saying they’re reducing alcohol for health and wellness reasons, while 44 per cent of Generation Z are cutting back to save money. Millennials are in the middle, with 51 per cent reducing alcohol for social and lifestyle cost reasons.
We’re also seeing that among younger Canadians aged 18 to 22, 65 per cent reported not drinking any alcoholic beverages in the past seven days, compared with 54 per cent for Canadians overall. So that next generation of consumers is drinking considerably less.
ROGER: Wow.
PETER: Do you think there’s any chance of stabilization here? Is there a point where restaurants can say this is the bottom?
KELLY: I mean, this is a bit of a guess, but we often see trends move in cycles. We do have a chronic affordability issue that doesn’t seem to be going away, but lifestyle trends can shift fairly quickly. I do think we may start to see some stabilization.
That said, operators have to meet consumers where they are. That could mean offering lower-alcohol drinks, or smaller serving sizes. Instead of eight- or nine-ounce glasses of wine, maybe it’s three- or four-ounce servings.
There’s also a lot of opportunity in non-alcoholic beverages. We’re seeing more products in beer, wine and spirits that are low or no alcohol, and that’s an area operators can explore.
ROGER: Pricing may also be a challenge there. Some non-alcoholic drinks are priced close to alcoholic ones. I want to go back to whether this is happening across all types of restaurants. Is there a divide, where higher-end consumers are still spending, while others are pulling back?
KELLY: Yes, where we’ve seen the biggest drop is in bars and nightclubs. Higher-end restaurants are still seeing purchases, but consumers are shifting behaviour. They’re spending more on a higher-quality bottle of wine rather than buying larger volumes.
So it’s more about the experience — people may have one high-quality cocktail instead of several lower-quality ones.
ROGER: We’re out of time, but quickly — it’s St. Patrick’s Day. What are you expecting?
KELLY: I’m cautiously optimistic, but the days of long lineups outside pubs early in the morning are likely behind us. Hopefully, people still get out and support their local restaurants, because it’s a challenging period.
ROGER: Kelly, thanks very much for joining us.
KELLY: Thank you.
ROGER: Kelly Higginson is president of Restaurants Canada.
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This BNN Bloomberg summary and transcript of the March 17, 2026 interview with Kelly Higginson are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
