E&S Market Weathered Storms First Half Of 2014

Things were looking a little dicey early in the year as brutal winter weather battered many foodservice operators in North America. Now that we finally have all of the numbers in on the second quarter, we can safely say most suppliers of equipment and supplies weathered the storms. But the reports from MAFSI and from John Muldowney’s compilation of publicly reporting E&S companies clearly reveal just how much chains and global markets drive E&S sales.

The eight publicly reporting companies reported combined sales growth of 7% for the first half. And that number is depressed by a 1.9% decline in sales for the three supplies-oriented companies. The five equipment-oriented companies—Manitowoc, Middleby, Standex, ITW FEG and Rational North America—posted a nearly 9% gain in the first half.

On the other hand, growth in the broader market was more modest. Manufacturers’ reps surveyed for the MAFSI Barometer reported sales gains of 3.3% in the first quarter and 3.1% in the second. Equipment sales, which normally lead increases, slowed even more.

Manitowoc, Middleby and Standex all noted chain rollouts as key factors driving growth this year. Manitowoc and Middleby also reported strong gains in sales offshore, as they help equip their global chain customers.

And this helps explain why FER has forecast overall growth of 4.4% for the E&S market this year. The eight publicly reporting companies account for more than $4 billion in sales annually.

But the rest of the market also seems to be looking at a stronger second half. Anecdotally, dealers, reps and manufacturers have told us all of the market segments are doing well as we enter the last four months of the year. MAFSI’s reps forecast a 5.7% gain in the third quarter. They also report high levels of consultant and quotation activity. And that bodes well for future growth.

Cheers,

Robin Ashton

Publisher 

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