Foodservice Equipment Reports

FER Revises Up Estimate Of 2013 E&S Sales, Holds 2014 Forecast at 4.1%

In light of stronger than expected sales during the second half of last year, Foodservice Equipment Reports has revised upward its estimate of foodservice equipment and supplies sales for 2013. FER now estimates total industry E&S sales at the manufacturer level rose 4.5% last year to a total of $10.113 billion. Real growth for ’13 is estimated at 2.4% with an estimated 2.1% overall increase in prices.

The new estimate compares with the magazine’s previous 2013 forecasts, revised in early August last year, of 3.3% in current dollars and 1.5% in real terms. Equipment sales are now estimated to have risen 4.6% and supplies and tabletop sales 4.3% nominally.

“E&S sales during the second half of 2013 were simply much stronger than we expected, especially given that operator sales were sputtering," said FER Publisher Robin Ashton, who with John Muldowney, a marketing executive at the Boelter Cos., produces the forecasts.

Ashton cited strong gains in the MAFSI Business Barometer and by publicly reporting equipment companies as the basis for the upward revision. The MAFSI Barometer rose 4.8% in the fourth quarter ’13 with equipment sales up 5%. This followed overall gains of 6.1% in the second quarter, a record, and 4.5% in the third quarter. On average, the Barometer was up 4.45%.

The seven publicly reporting equipment and supplies companies saw sales for the year rise 4.4% with the five equipment companies up 5.5% over 2012 and the two supplies companies down 1.3%.  In the fourth quarter, three of the five equipment companies recorded double-digit gains and the five companies saw sales rise 9.6%. The supplies companies posted a combined 2.3% fourth-quarter gain.

FER has not revised its forecast for 2014, nor its long-range forecasts through 2017. “Given the harsh winter and its impact on operators and construction, John and I are sticking with our current numbers for 2014,” Ashton said. FER forecasts nominal growth of 4.1% and real growth of 2.1% this year. Equipment sales are expected to grow 4% and supplies and tabletop 4.5%.

FER bases its forecasts on market numbers from the North American Association of Food Equipment Manufacturers’ biennial “Size & Shape of the Industry” studies. The current base year is 2011. Numbers on price changes are estimated based on data from AutoQuotes Inc.

A spreadsheet of the revised forecast can be downloaded here