With dining lifestyles changing and the hospitality industry aggressively investing, the global foodservice equipment industry’s growth forecast remains positive.
With rapid changes in lifestyle leading to a shift in consumer preference from full service restaurants to quick service restaurants, the global foodservice equipment market is anticipated to witness significant revenue growth over the forecast period, according to Research and Markets’ report called Foodservice Equipment Market: Global Industry Analysis and Opportunity Assessment 2016-2024. As a result, domestic and international companies are making major investments in quick service restaurants.
The report explains that sales of foodservice equipment is expected to increase at a rapid pace owing to high expenditure on food and related items. However, high cost of foodservice equipment is a prime challenge for foodservice operators, as this accounts for a major share of total capital cost for new foodservice outlets.
Besides, foodservice equipment need to be tailored according to requirements and available space in food retail stores. This, in turn, significantly increases costs associated with foodservice equipment.
While cooking equipment accounts for one-third of total foodservice equipment market, food preparation equipment market is predicted to expand at a CAGR of 6.1% over the forecast period.
Full service restaurants are also expected to dominate foodservice equipment market over the forecast period. On top of that, rapidly growing number of quick service restaurants is creating high growth opportunities for foodservice equipment market.
Hospitality plays a part in market boost
Another research firm, Transparency Market Research (TMR), reveals that the global foodservice equipment market is being driven by the increasing penetration of the hospitality industry — as highlighted in its Food Service Equipment (Commercial Refrigeration) Market — Global Industry Analysis, Size, Share, Growth, Trends and Forecast 2014-2020 study. TMR says the global foodservice equipment market was valued at US$31.5 billion in 2013.
Exhibiting a steady 4.80% CAGR between 2014 and 2020, the valuation of the market is likely to rise to US$44.3 billion.
The major driver for the global foodservice equipment market is the increasing presence of the hospitality industry, the study reports. With the growing availability of urban infrastructure in developed regions and the rising disposable income of consumers, the hospitality industry is experiencing steady growth all over the world.
The increasingly hectic lifestyle of urban consumers is also forcing them to eat out regularly, which is another factor driving the demand for commercial refrigeration services.
The advancement in refrigeration technologies over the past few years has also helped the global commercial refrigeration market immensely, according to TMR’s lead analyst. The cost-effectiveness of foodservice equipment has become increasingly important for the hospitality industry due to its direct impact on the company’s profit margins, driving the demand for advanced commercial refrigeration products.
High capital deters small players from investing
The prohibitively high capital investment required to install top-notch foodservice equipment has however restrained the growth of the global market, TMR says. While large international players can afford to install advanced commercial refrigeration services, new players have to make do with older technology. This is a key restraint on the global foodservice equipment market, but is likely to be ameliorated over the forecast period, the research firm adds.
Walk-ins to remain dominant product type
By product type, walk-ins held the largest share in the revenue of the global foodservice equipment market in 2014, according to TMR. Preferred by vendors due to the higher convenience they provide to customers, walk-ins accounted for close to one million commercial refrigeration units in 2013. Although walk-ins are expected to remain the leading segment of the global commercial refrigeration equipment market until 2020, the beverage dispensers segment is likely to exhibit the highest growth rate of all product segments. Other major product types in the global commercial refrigeration market include ice machines, glass-door merchandisers, refrigerated vending machines, commercial fridges/freezers, ice-cream cabinets and blast freezers.
Technology drives demand in North America
North America was the largest market for foodservice equipment in 2013, the major driver being the early establishment of the market in the region. North America’s position as the premier technological hub has also helped keep the regional commercial refrigeration industry at the cutting edge of technological innovation, notes TMR.
North America was the largest market for foodservice equipment in 2013, the major driver being the early establishment of the market in the region.
The major players in the global foodservice equipment market, according to TMR, are Meiko, Ali Group, Fujimak Corporation, Hobart Corporation, Hoshizaki Electric Co Ltd, Manitowoc Company Inc, Rational AG, Dover Corporation, Libbey, Electrolux AB, Vollrath Co, Tupperware Brands Corporation, Duke Manufacturing, Cambro Manufacturing Company, Middleby Corporation, Alto Shaam, and Dispensing Dynamics International.