Catering equipment firms see “catastrophic” drop in sales
UK: The Foodservice Equipment Association (FEA) fears that COVID-19 has had a “catastrophic” impact on sales in a market that was already down 25% in Q1 compared to 2019.
Based on feedback from members, FEA chief executive Keith Warren has described current trading conditions as “universally grim”.
The Association estimates that the foodservice equipment sector contracted by about a sixth between January and March this year and that, year on year, it was down by around a quarter compared to Q1 2019. It fears the results in Q2 will be a lot worse, since the COVID-19 crisis only really kicked in towards the end of the first quarter.
The contraction in January and February was blamed on operators pulling back and a general tightening of the market.
“We don’t think it was all a result of Brexit,” Keith Warren said. “Members were reporting that the market was down and now, with more detailed feedback, we believe it was in significant decline.
“But there is no doubt that, whatever the reason at the time, since then CV-19 has exasperated the problem catastrophically. Many foodservice equipment companies have seen their sales drop by 100% as a result of the crisis. If you’ve lost 80% of sales, you’re doing well.”
FEA sees no likelihood of change while the hospitality market’s doors are shut. Even when things start opening again, it will take time for confidence to return, both for foodservice operators and their customers.
“The good news is that foodservice operators are looking into ways to restructure their businesses to address the challenges,” said Warren. “There will be the need for new layouts, possibly extended opening hours, and there’s the growth in delivery and takeaway. It won’t be business as usual, but it will be business.”