October 02, 2013
It’s been a tough year—or two or four—in many major foodservice markets around the world. True, the foodservice and equipment and supplies markets in the U.S. have posted moderate growth since 2011, but the U.S. has been the exception. Foodservice in Europe has been particularly hard hit with negative trends in even the stronger economies. China, India, Australia and other major markets in Asia/Pacifi c were booming, but recent traffic and sales growth rates have fallen dramatically, according to data from The NPD Group and other sources. But all this is past. What about the future?
While plenty of challenges remain, it appears things will get better in most major foodservice markets next year. Macroeconomic forecasters are predicting gross domestic product growth rates will increase in many economies in 2014. According to consensus forecasts by economists polled by the newsletter Blue Chip Economic Indicators, real GDP growth rates are expected to increase by at least a full percentage point in the U.S., Mexico, Germany, the Netherlands and the Eurozone as a whole, and in Asia, including Taiwan. Economies with growth rates forecast to
gain by a half point to a point include Canada, Brazil, the United Kingdom, France, Russia, South Korea, Hong Kong and India. Growth rates are not forecast to change much in China, Japan or Australia, but should remain positive in all three countries.
There are already signs of improvement. While NPD reports traffic counts continued to fall in six of the 10 foodservice markets it monitors in the second quarter this year, sales fell in only four of the 10, all in Europe. In the U.S., traffic rose slightly, which was somewhat of a surprise after a weak first quarter. On the E&S side, second-quarter sales as reported by the seven publicly reporting companies we follow, and as tracked by the Manufacturers’ Agents Association for the Foodservice Industry, were also a big positive surprise, up 4.1% and 6.1% respectively.
In the U.S., Chicago-based research firm Technomic Inc. forecasts operators’ sales will grow 4.1% in current dollars next year, up from the group’s forecast of 3.8% growth in 2013. Total market “commercialized” sales are expected to reach an incredible US$685 billion this year.
We released our own forecasts for growth of the U.S. and Canadian E&S markets in August. We expect E&S market growth to accelerate in the second half of this year and into 2014, peaking in 2015 before starting to slow again in 2016 and ’17. The current forecast is for nominal growth of 3.3% in 2013 with real growth of 1.5%. Our forecast for ’14 is 4.1% nominal and 2.1% real.
While projected growth rates are important, the on-the-ground reality is that foodservice and hospitality continue their global expansion at a dizzying pace. While many American chain brands saw their sales-growth rates outside the U.S. slow last year, nearly all continued to open new units aggressively.
Which is why, for the 14th year, we bring you this unique, comprehensive guide to more than 5,000 manufacturers of foodservice equipment, supplies, furnishings and related products around the world. We hope you find it useful and wish you a healthy and successful 2014.