Foodservice Equipment Reports

The Bright New Year, Mostly

One of my favorite English folk singer-song writers and guitarists, Bert Jansch, died last year. He wrote a wonderful song, “The Bright New Year,” released in 1969. I found myself inadvertently humming it as I thought about the outlook for the foodservice and equipment and supplies markets in 2012. The song starts with the line “I hope you are well and happy today,” which is not a bad way to greet you all in this new year. But while the lyrics to the song are quite upbeat, it’s in a minor key. It makes for an interesting tension. In other words, it’s rather like our 2012 market outlook.

We know you’ll read our annual forecast articles—a look at what several leading commercial and noncommercial operators see for the coming year, plus our forecasts and analysis of the operator and E&S markets—so I won’t repeat the numbers. Both the core foodservice market and E&S sales should grow again this year, for the second year since the Great Foodservice Recession began in late ’07.

But both Technomic Inc., which graciously let us borrow its ’12 operator forecasts, and we at FER still note signs of strain in several segments of the markets. Technomic forecasts that restaurants and bars, which account for two-thirds of the total market, will see sales growth of less than half a point in real terms. Bars and taverns and a number of “beyond restaurant” categories from recreation and business and industry to nursing homes and corrections, are predicted to see sales fall this year.

As we noted in our editorial last month, growth in the E&S market is outpacing its operator base, as operators renovate facilities and replace worn equipment and aging supplies and tabletop. But the so-called “spec” segments are still very challenged, as public funding for both operations budgets and capital improvements continues to fall in most areas of the country.

Still, the positives clearly outweigh the negatives. And a number of researchers, including Technomic and the National Restaurant Association, have recently reported that operators as a whole are reasonably upbeat about their prospects this year. With optimism comes willingness to invest in their facilities. And that’s why we think E&S will have a second consecutive year of decent, if not robust, growth.

Which brings me back to Bert Jansch. The song on the album before “The Bright New Year” is called “Come Sing Me A Happy Song To Prove We Can All Get Along The Lumpy, Bumpy, Long And Dusty Road.” Indeed. May you all be well and happy this year.  

Cheers,

Robin Ashton

Robin Ashton

Publisher

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