Sales of foodservice equipment and supplies increased 4.1% in the second quarter of 2023, per data from The Manufacturers’ Agents Association for the Foodservice Industry.
This was less than the 4.5% sales increase reps had projected for the quarter and less than the first quarter sales increase of 6.6%. Reps forecast sales of equipment and supplies will increase at a rate of 3.5% in the third quarter of 2023.
While sales of foodservice equipment and supplies continue to grow, these single-digit increases reflect a mature market coming down from significant highs it experienced as it emerged from the pandemic.
Sales continue to fluctuate by region. The South saw sales increase 6.4% in the second quarter, the Midwest 5.0%, the West 4.5, Canada 2.8% and the Northeast 0.7%.
Looking at sales by product category, tabletop items led the way with a 6.3% increase, equipment 4.0%, supply items 3.7% and furniture 1.7%.
In terms of quoting activity, 40% of reps report an increase from the first to the second quarter and 35% report no change in this metric. Only 25% reported a decrease. Looking at consultant activity, 32% of reps report an increase and 48% report no change between the first and second quarters of 2023. Only 25% of reps report a decrease in consultant activity.
In writing the executive summary for this report, Michael Posternak, CEO of New York-based rep firm PBAC and Associates, said the industry is likely in the third leg of a four-legged “W” economic formation. The first leg was the 28.7% decline in the second quarter of 2020 as COVID “shut down our industry.” The “second leg” saw business peak as “COVID waned,” which led to a 19.1% growth rate in the second quarter of 2021. Now, the “third leg” features “reduced demand, ample supply and higher prices,” which led reps to forecast 3.5% growth for the third quarter.
“Overall business appears to be headed towards a period of “fits and starts”. We are in a period of market volatility not seen in the nearly 25-year history of the MBB,” Posternak added.