The State of the North American Food Sector, presented by Richter

A BLEAKER OUTLOOK AS LINGERING CHALLENGES MEET EMERGING THREATS

TORONTO, Sept. 30, 2025 /CNW/ - The 2025 North American Food Sector Study, compiled by Richter, surveyed owners and executives of privately held companies in the food industry in North America. The findings highlight key challenges and opportunities facing companies in the sector. Some of these findings are shared across all markets, while others are unique to specific product categories, value chain segments, and/or regions.

What the market is telling us: A tale of two countries, from one year to the next

• Canadian confidence in market conditions is almost double that of the US – Confidence in economic growth in the food industry remains high in Canada and less so in the US. 87% of Canadian business surveyed anticipate growth in the next 12-18 months, compared to just 47% of US businesses.
• Tariffs, one year in – 76% of executives claim they've been negatively impacted by tariffs and supply chain disruptions this year, compared to 11% in 2024. Raw material and packaging costs are considered the areas where the impact was felt most. In response, Canadian businesses are largely making spot adjustments to weather the storm and minimize disruptions, while US businesses are pursuing more structural, long-term changes.
• Sales volume drops, prices rise – Over half of respondents reported a drop in sales volume due to tariffs, and 87% of respondents are making – or are planning to make – changes to their pricing strategies in response. Common adjustments include list pricing increases, selective cost pass-throughs and more frequent pricing reviews.
• Double the uncertainty for the labour market – Labour uncertainty has jumped, with 46% of respondents describing labour market conditions as somewhat or extremely negative. This is up from 24% in 2024. Notably, only 6% of US businesses reported the labour conditions as being somewhat or extremely positive.
• Talent is hard to attract and train, even harder to retain – When it comes to attracting talent, 44% of respondents reported it to be very or somewhat difficult, compared to just 23% reporting it as such in 2024. Training new hires is also becoming a growing challenge, with 42% of respondents citing it as difficult this year compared to only 10% last year. Retention has emerged as the biggest pain point, with 67% reporting difficulty retaining talent in 2025 versus 20% in 2024. To combat this, most respondents are turning to outsourcing work (28%) while 20% are looking to automation solutions.
• M&A appetite higher in the US – 42% of US businesses have discussed M&A, compared to just 7% of Canadian businesses, and 23% of US businesses expect to be involved in an acquisition versus only 8% of Canadian businesses.
• Succession planning on the radar – While 25% of founder and C-suite respondents anticipate a succession event in the next 3 to 5 years, only two-thirds have or are developing a formal succession plan. However, nearly the majority of those planning a transition expect to move into a passive shareholder role supported by professional management, rather than fully exiting the business.

"While the sector is still managing political and economic uncertainty, operators are prioritizing strategies to stabilize their businesses and protect against future shocks. There is no single solution to the challenges companies are facing, meaning that companies are identifying and addressing their biggest exposures, whether it is margin preservation, operational efficiencies, or labour optimization. While current growth prospects may be subdued, those who weather the storm are likely to emerge stronger." says Richter partner, Michael Black.

Richter's 2025 North American Food Sector Study offers invaluable data on the current state and future trajectory of the food and beverage industry in North America. For detailed findings, read the full study here.

About Richter

Richter is a Business | Family Office that provides strategic advice on business matters and on families' financial and personal objectives across generations. With close to 100 years of experience advising at the intersection of family and business, Richter has developed an integrated approach to help business owners find sustainable success. Whether business, personal, or both, Richter is uniquely positioned to address the needs of Canada's most successful entrepreneurs, private clients, business owners and business families and help them chart a clear path to shape their legacy for the future. Founded in 1926, Richter's 600-person multidisciplinary team continuously innovates to create value for our people, clients, and community in Canada and in the US.

About the study

Richter commissioned a double-blind survey of executives throughout North America to gather insights on the macroeconomic conditions, strategic priorities, and challenges alongside how their organizations were addressing growth, M&A, and operating dynamics. The over 150 owners and executives who participated in the survey represent a cross section of privately held, predominately owner- / founder-operated, small and medium-sized enterprises (SMEs) in key segments of the food sector.

SOURCE Richter

For media inquiries, contact: Teresa Chimienti, Director, Marketing & Business Development, [email protected]