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Cherry Tree Report
I
received the 2009 food service equipment industry report from our financial
friends at Cherry Tree. Cherry Tree may be the best-informed investment banking
house in our industry, and the only ones I know of who annually sum up its
activity. Kevin McKenna is the Managing Director if you are looking for
research or have a transaction in mind.
Some
of these statistics are familiar to us but it is still good to refresh
occasionally. Food Service Equipment is a $10 billion industry in the US. There are over 900,000
foodservice outlets nationwide and consumers will spend an estimated $514
billion in foodservice operations this year.
This reflects about a 2.6% decline from 2008.
The
two dominant sectors of the foodservice industry are limited service and full
service restaurants which combined account for nearly two-thirds of consumer
spending and half of the outlets. As you
would expect, substantial declines are projected for this year in these
sectors. You can get the full report free from Cherry Tree. website link
Some
statistics from the Cherry Tree report are projections from the foodservice-focused
consultants at Technomic. Ron Paul
is the principal at Technomic.
Of
interest to equipment manufacturers is that the drivers of equipment purchases
are education and healthcare, both projected for growth (click here for more).
Foodservice consultants are already at work on those projects, so the
specification market is one that (as always) deserves attention in your
marketing plans.
As
for drivers of purchases, replacement of equipment is behind a whopping 60%
followed by renovation-driven purchase at 19%.
Green is on the list but at only 5% - but it will grow when the economy
comes back. There will be a huge replacement demand after this drought.
The
report is packed with additional data including updates on the Manufacturing and
Dealer sectors and industry trends. There
are company rankings and Dealer rankings.
The largest transaction was of course Manitowoc acquisition of Enodis a
year ago; Middleby wins the 2008-9 acquisition race with six. Evaluations to
revenue and EBITDA are reported on public transactions and Cherry Tree estimates
the current valuation for privately-held middle market companies will range from
4.5x to 5.5x trailing EBITDA.
--Mike Colburn, President
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SA Vent Approvals Completed
We
are pleased to announce that all approvals are now complete for the innovative
and unique SA Vents designed by Ideas Well Done and manufactured by Equipex. These patent-pending technology products are
now available for sale. A lot of enthusiasm
was generated during the development process - we're excited that a solution
for countertop small appliance ventilation is now at hand.
All
three models - PALI, MISTRAL (pictured) and KONA - are approved to UL and NSF
standards. PALI and MISTRAL have also
successfully passed the EPA 202 grease extraction standard (part of
UL710B).
The
SA VENTS are now going into production.
The anticipated availability for orders placed will be the latter part
of November. Thereafter, lead
times will be reduced significantly.
AUTOQUOTES
has been updated with the current information and specification sheet. KCL Symbols update is in progress. A revised specification sheet is available
from Equipex.
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Please forward this newsletter to anyone who would be interested in
foodservice equipment design, development and invention.
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