Foodservice Equipment Reports Fortnightly
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Welcome to FER Fortnightly Online Newsletter
February 22, 2005








Regulatory Report:
Sponsored by: APW Wyott Innovations

Wisconsin Looking To Get Out Of Health Inspection Biz
New Mexico Equipment Cert Deadline Looms
Illinois Gov. Signs School Breakfast Act
California Offers Energy Efficiency Loans For Schools, Hospitals
Honey-San, I Shrunk The Food Waste


Industry Report:
Sponsored by: Salvajor Co.

Brazos Acquires Majority Stake In Strategic
CEOs Of IHOP, Panera Win Silver Plate Awards
Changing Of The Guard At TriMark USA
Hicks Tapped As Lincoln’s Interim Prez
Charlie Brown’s To Be Sold To Trimaran
Zoom, Zoom, Zoom…To Anaheim
Who’s Your Favorite Dealer? Now, Vote!
Oneida To Sell Sherrill Flatware Manufacturing Facility




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In This Section:
Reps Expect Stronger E&S Sales
Blue Chip Economists, Greenspan Foresee Stable Macro Growth
QSR Hamburger Concepts Drove 2004 Traffic Gains
Forecasts For Growth In Europe, Japan Are Cut

This issue's Regulatory ReportSponsor: APW Wyott Innovations Industry ReportSponsor: Salvajor Co.


Industry Report Sponsored by Atlas Metal Industries Inc.

Reps Expect Stronger E&S Sales
Manufacturers’ reps expect a better year in 2005, according to those polled for the quarterly Business Barometer survey fielded by the Manufacturers’ Agents Association for the Foodservice Industry. MAFSI reps forecast overall nominal sales growth of 5.6% for the year. This compares with their forecast of 4.2% for ’04 and 2.4% for ’03.

The optimism comes on the heels of a 2.6% overall gain for the fourth quarter of ’04, the second strongest quarter since MAFSI began the Barometer in ’02. (The second quarter of ’04 scored 2.9%.)

All five regions reported sales gains for the fourth quarter, with Canada growing a whopping 7%. The Midwest showed the smallest gain, 0.8%.

All four product categories were also positive, with equipment and supplies each up 2.7%, furniture showing a 2.5% gain and tabletop up 2.3%.

The reps expect overall sales growth of 4.0% in the first quarter of ’05, the strongest quarterly forecast in the Barometer’s history. Price increases are without question a factor in the Barometer results and forecasts, as manufacturers try to recoup strongly higher material costs by raising prices.


 

Section sponsored by Atlas Metal Industries Inc.

Blue Chip Economists, Greenspan Foresee Stable Macro Growth
Randall Moore, executive editor of Blue Chip Economic Indicators, characterized economic growth in the U.S. this year as on "an exceptionally nonvolatile trajectory," as leading economics polled by the organization held to their forecast of 3.6% real growth for 2005, according to the February 10 newsletter.

Their forecasts essentially match the expectations of continued moderate growth in the U.S economy that Federal Reserve Board Chairman Alan Greenspan presented to Congress Feb. 16 and 17.

The Blue Chip group expects the quarterly growth rate through the course of the year to be nearly static, with 3.5% growth forecast for every quarter, except the second, when growth is predicted to edge up to 3.6%. The economists raised slightly their forecast of real personal consumption expenditures to 3.5%. This is down only slightly from the 3.8% growth seen in ’04. They held to their forecast of 2.5% calendar year growth in the Consumer Price Index. The CPI rose 2.7% in ’04.

The forecast for ’06 GDP growth also remained unchanged at 3.4%.



Section sponsored by Atlas Metal Industries Inc.

QSR Hamburger Concepts Drove 2004 Traffic Gains
The hamburger giants were in large part responsible for the 1.2% gain in overall restaurant traffic in 2004, according to NPD Foodworld’s CREST data.

New adult-oriented salads and other menu items at hamburger concepts helped push traffic 4% higher last year. Since nearly a quarter of all restaurants in the country are characterized as hamburger dominant, the gains drove the entire industry. The increase in ’04 follows two negative years of traffic growth. Traffic at hamburger restaurants has been positive for six consecutive quarters.

Overall, QSR concepts and casual dining restaurants saw 2% traffic growth in ’04, while midscale and fine dining concepts saw traffic fall 2% each.

Other menu types showing strong traffic growth last year were gourmet coffee and tea, donut, bakery sandwich, bar and grill, and steak and rib. Among concepts struggling in ’04 were cafeterias, which saw traffic drop a whopping 15% as a number of chains closed units; varied menu and Asian concepts. Many operators in the latter two categories are independents or small chains.



Section sponsored by Atlas Metal Industries Inc.

Forecasts For Growth In Europe, Japan Are Cut

The major European economies continue to struggle as consumer spending is stifled by high unemployment and as export sales are undercut by the strong Euro.

The latest forecasts from Blue Chip Economic Indicators reflect reduced expectations for growth in Germany, France the Netherlands and Belgium. The forecast for Germany, the largest European economy, has been cut to 1.4% real GDP growth for 2005. This is down from ’04’s 1.6%. Overall, the GDP forecast for Euroland, those countries that use the Euro, was cut to 1.7% from 1.8%. The countries grew 1.8% last year.

The forecast for the United Kingdom, meanwhile, is up a tenth of a point to 2.5%, though there are signs of trouble as retail sales for the Christmas season were the worst in 25 years.

The Blue Chip group also cut forecasts for Japan, Taiwan, South Korea and Singapore though growth forecasts for all but Japan remain above 4% real GDP growth. Japan’s growth is decelerating rapidly after 4.1% growth in ’04. The forecast for growth in China inched up to 8.0% from 7.9%. Growth last year was a remarkable 9.5%.




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