Foodservice Equipment Reports Fortnightly

Welcome to FER Fortnightly Online Newsletter
August 14, 2007

Regulatory Report:
Sponsored by:
Brace For More FOG Rules In California
ADA Enforcement Gets Tough
EC Gives Companies A Say In WEEE/RoHS
NRA Web Site Lists Local Food Safety Training Rules
Seattle Bans Trans Fat, Calgary Considers It, Chains Dump It

Industry Report:
Sponsored by:
The NAFEM Show 2007
Middleby Acquires Carter-Hoffmann, MP Equipment, Wells Bloomfield
Sun Capital Acquires Boston Market
TriMark Acquires Gill Companies
Early Bird Gets Worm, Er Discount, At IH/M&RS
Enodis Announces Merrychef Partnership With Subway

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In This Section:
MAFSI Barometer: Moderate Growth For 2Q
Sales, Traffic Drive NRA Performance Index Higher In June
FER Predicts E&S Market Growth At Forecast Meeting
Blue Chip Economists Cut Key Forecasts For 2007, 2008

This issue's Regulatory ReportSponsor: Enodis
Industry ReportSponsor: The NAFEM Show 2007
Economic Report Manitowoc Foodservice Group

MAFSI Barometer: Moderate Growth For 2Q
The equipment and supplies market might be heading for a slowdown, judging from data revealed in the latest quarterly Business Barometer fielded by the Manufacturers' Agents Association for the Foodservice Industry.

Sales rose a modest 2.8% in the United States and Canada for second quarter 2007, a number which, "given the high level of price increases...points to negative (E&S) unit growth," MAFSI said. But the figure was an improvement over the first quarter's 2.3% rise. The slowdown follows record gains during the third and fourth quarters of '06.

Equipment sales rose only 2.5%, as sales were negative in two regions, the Northeast and West. Tabletop sales rose 4.1%, supplies were up 3.6% and furnishings sales grew 3.5%

Sales growth was strongest in Canada, where overall sales jumped 6%. Sales gains were 5.2% in the South, 2.5% in the Midwest, 0.2% in the West and flat in the Northeast. The reps surveyed forecast third quarter sales will rise 3.6%.


Section sponsored by Manitowoc Foodservice Group

Sales, Traffic Drive NRA Performance Index Higher In June
A strong jump in same-store sales and traffic helped pushed the National Restaurant Association's Restaurant Performance Index higher in June. Both the Current Situation Index and the Expectations Index moved up, and the overall Index, at 101.4, topped May's 100.9 and remained above the 100 tipping point between expansion and contraction.

Same-store sales jumped 1.6 points to reach 102.7 in June, the highest point for the component since March 2006. The traffic component rose 0.8 point. Overall, the Current Situation Index gained 0.8 point.

The Expectations Index moved 0.2 point higher, primarily on a 0.8 gain on expectations of future business conditions. Both capital expenditure components, one indicating purchases during the past three months and one showing expected spending during the next six months, fell slightly, but remain at historically high levels.

Section sponsored by Manitowoc Foodservice Group

FER Predicts E&S Market Growth At Forecast Meeting
Nearly 60 attendees heard Foodservice Equipment Reports Publisher Robin Ashton predict another year of positive equipment and supplies market growth in 2008 at the magazine's annual E&S Market Forecast President's Preview held Aug. 1 at the Eaglewood Resort & Spa in Itasca, Ill.

Ashton said strong growth of consultant-specified markets and rapid unit growth plans by quick-service and hotel concepts outside the United States should keep the market on a positive course next year. But he also noted slowing consumer spending in domestic markets does pose risk, and aggressive E&S price increases can also be expected to continue.

The meeting featured FER's exclusive, hard-number forecasts of E&S market growth in '07 and '08, analysis of general economic and operator metrics and trends, materials price forecasts and exclusive data on E&S price changes from AutoQuotes. The meeting kicked off with a panel of multi-unit operators discussing needs and challenges.

A second meeting, FER's 2008 E&S Market Forecast Focus on Channels, is slated for Oct. 25 at the Embassy Suites O'Hare near Chicago. This meeting is designed for dealers, consultants, reps and service agents, as well as manufacturers. One special panel will probe the health of the various E&S market functions. Another will probe service costs for chain operators, including warranty and non-warranty pricing and issues.

Further information on the Focus on Channels program, costs and registration forms are available at or by calling Chris Palmer at 847/336-2049 or e-mailing her at

Section sponsored by Manitowoc Foodservice Group

Blue Chip Economists Cut Key Forecasts For 2007, 2008
Slowing consumer spending and continuing turmoil in housing and financials markets have led the more than 50 leading economists polled monthly by Blue Chip Economic Indicators to pare their forecasts of economic growth and consumer spending for both this year and next.

The consensus forecasts now call for real growth of gross domestic product of 2% for 2007 and 2.8% for '08. Both forecasts are 0.1 point lower than last month.

The forecasts for real growth of disposable personal income and personal consumption expenditures also were cut. The economists' current forecast for '07 PCE growth was slashed 0.3 point to 2.9% in response to slow second quarter consumer spending. The PCE grew only 1.3% on an annualized basis in the second quarter, the slowest rate since the post-Katrina fourth quarter of '05.

Both the DPI and PCE forecasts for '08 were also cut by 0.1 point and currently stand at 3% for DPI and 2.5% for PCE. If the PCE growth rate for next year holds, it will mark the slowest gain in consumer spending since '01.

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