As global trade tensions continue to ripple through industries, Canada’s restaurant sector faces unique challenges. Peter Mammas, President and CEO of Foodtastic, one of the country’s fastest-growing restaurant franchising companies, shared his perspective on the impact of tariffs, the resilience of the restaurant industry, and the importance of supporting Canadian suppliers.
Foodtastic, founded in 2016, has rapidly expanded to manage over 1,200 restaurants across Canada and internationally. The company’s diverse portfolio includes well-known brands like Milestones Grill & Bar, Second Cup Café, Pita Pit, and La Belle & La Boeuf Burger Bar. Despite the looming threat of tariffs, Mammas remains optimistic about the company’s ability to adapt.
“Right now, less than 10% of our supply chain comes from the U.S., and what we do buy includes items we can’t source locally, like lettuce and tomatoes,” Mammas explained. “For produce, we’re shifting our procurement directly to Mexico, bringing goods bonded straight to Canada, which helps us avoid U.S. tariffs altogether.”
When it comes to alcohol, another area affected by trade disputes, Foodtastic is turning the situation into an opportunity to support local producers. “We’re reaching out to Canadian alcohol producers to list more of their products in our restaurants. It’s about doing our part to support Canadian businesses,” Mammas said.
The Broader Impact on Canada’s Restaurant Industry
While Foodtastic’s proactive approach has minimized its exposure to international trade disruptions, Mammas acknowledges that the broader industry may feel the pinch.
“Most restaurants in Canada can source what they need domestically, except for seasonal produce,” he noted. “The real concern is the potential economic ripple effect. If the overall economy slows down, restaurant sales could soften, and that would impact the entire supply chain.”
However, Mammas is confident in the industry’s resilience. “We’ve survived COVID, hyperinflation, and labour shortages. We’ll get through this too. The restaurant industry is incredibly adaptable,” he emphasized.
Managing Costs and Pricing Strategies
Despite potential cost increases due to tariffs, Mammas believes the impact on pricing will be manageable.
“Even if we had to absorb additional costs from U.S. imports, it would translate to about a $10 million hit across our network of over 1,000 restaurants,” he explained. “That’s roughly $10,000 per store, which we can offset with a modest 2% price adjustment.”
This strategic approach ensures that Foodtastic can maintain profitability while minimizing price hikes for consumers. “We’re in a strong position because we prioritized local sourcing years ago,” Mammas added.
Embracing Canadian Pride and Supporting Local Businesses
For Mammas, the current trade climate has highlighted the importance of national unity and supporting Canadian businesses.
“I haven’t seen the country this unified in a long time. There’s a renewed sense of pride in buying Canadian and supporting local brands,” he said. “At Foodtastic, we’re committed to working with Canadian suppliers. If there are producers out there who think their products could fit in our restaurants, we want to hear from them.”
Breaking Down Barriers Within Canada
While international trade issues dominate headlines, Mammas pointed out that interprovincial trade barriers within Canada pose significant challenges.
“It’s sometimes easier for Canadian producers to sell to the U.S. than to neighbouring provinces,” he said. “We need to eliminate these barriers to create a truly free internal market. If a product is approved in one province, it should be accepted nationwide.”
This sentiment reflects a broader call for policy changes to support domestic businesses.
“We have abundant natural resources and high-quality products. It’s time to streamline our internal trade and showcase Canadian goods to the world,” Mammas emphasized.
Delayed Tariffs Provide Temporary Relief
On February 3, President Donald Trump announced that tariffs on Canadian imports would be delayed until March 1. This postponement offers temporary relief to Canadian businesses, providing more time for negotiations and adjustments.
While this delay is a welcome development, the threat of tariffs still looms large. The possibility of future trade restrictions continues to create uncertainty for Canadian businesses. Additionally, the unpredictability of U.S. trade policy under President Trump could pose significant risks to Canada’s economy throughout his term, potentially affecting industries far beyond the restaurant sector.
Looking Ahead
As Foodtastic continues to grow its business in Canada, the company remains focused on its core values of innovation, quality, and community support.
“We’re proudly Canadian, and our growth strategy reflects that,” Mammas concluded. “Whether it’s through acquiring new brands or supporting local suppliers, we’re committed to strengthening Canada’s restaurant industry.”
