Breslau, Ont. restaurant prides itself on customer loyalty to avoid trend of thousands of restaurants closing cross-country

CTV’s Spencer Turcotte finds out how local restaurant owners are trying to avoid shutting down their businesses amid ongoing financial pressures.

Thousands of restaurants across Canada closed last year and thousands more could go out of business this year.

It has one Breslau, Ont. restaurant looking for ways to ensure they’re not next on the chopping block.

“I think that it’s a fear,” said Fran Adsett, owner of Frannie’s Restaurant. “I’m in the middle of nowhere, but you still have that anxiety that is out there that businesses aren’t where they used to be.”

Those fears come as a new study out of Dalhousie University shows 7,000 restaurants closed across Canada last year, and more than 4,000 could go out of business this year.

“Probably the two biggest factors are the increase in labour costs and the increase in cost of food,” said Bruce McAdams, a professor in the School of Hospitality, Food and Tourism Management at the University of Guelph.

Southern Ontario is particularly vulnerable for restaurant closures because of just how many restaurants there are in the province, especially chains.

“These are restaurants that will be built and opened when there’s not necessarily demand in the community. They are sort of looking to take demand away and grasp a bigger share of the market because of their brand name, their consistent product,” said McAdams.

Frannie’s Restaurant is in a unique position because it’s a destination restaurant, considering it’s not surrounded by much else. But that creates its own challenges and Adsett is always making necessary tweaks.

“Since we hit January, our hours get cut back. We’re open Sunday through Thursday 7 a.m. to 3 p.m. and then Fridays and Saturdays we’re open 7 a.m. to 7 p.m.,” said Adsett. “We cut back on our staff, and we do skeleton staff in the wintertime.”

She cuts costs by not hiring managers and she also does her own baking, meaning she does not outsource the sweet treats she sells.

“The food is good, we’ve always enjoyed,” said customer Margaret Taylor. “I’m thinking I might be getting a butter tart on the way out.”

Adsett said she is at the restaurant at all hours of the night to bring the menu items to customers’ plates.

“I do my own freezer meals and the majority of tables that come in here, they’re grabbing frozen dinners on their way out. That all helps because it’s like having another table dining in your restaurant,” said Adsett.

But chain restaurants continue to put pressure on the entire industry.

McDonald’s Canada announced Tuesday a one-year price freeze on its McValue menu, which sets the table for a price war that a place like Frannie’s simply cannot compete in.

“That sometimes forces an independent to price lower than the actual value of the meal they’re putting forward,” said McAdams.

Adsett adds they don’t buy things in volume so they don’t have the luxury of offering items at that low of a price.

“Our bottom dollar that we are trying to make is harder to make than your franchises out there,” she explains.

She says the two most important ingredients in keeping her restaurant alive are food quality and customer loyalty.