FEA issues market update underlining sales downturn

The Foodservice Equipment Association (FEA) has conducted research into the state of the foodservice equipment market, with more than half of respondents expecting sales to be no more than 50% of pre-Covid-19 levels by December.

However, expectations for prospects lift considerably after 12 months, with most suppliers predicting sales levels getting to 70% or beyond. By December 2021 over a third expect to be back at 100% of pre-lockdown figures.

The research, conducted in June 2020, enlisted members of FEA and included UK manufacturers, distributors of imported equipment, dealers and service companies.

In terms of the impact on the workforce, all respondents had furloughed staff, and nearly 40% had furloughed over 80% of their employees. Nearly 40% expect to make redundancies, with respondents expecting a reduction in equipment suppliers’ sales and support teams and a focus on ‘digital transactions.’

The research also covers the thorny issue of payments, with 60% of respondents experiencing problems collecting payments from customers. Just over 30% of companies surveyed had applied for business grants, with over 60% of these applications turned down. Over 95% of those making insurance claims were also turned down.

Companies, did, however, report success with business support loans: of the 36% who had applied for a loan, 53% were successful.

In terms of the immediate future, most respondents expect to see an increase in second-hand equipment on the market, and for credit to be tight. Both factors are expected to reduce demand for new equipment.

One area likely to gain is innovation, with respondents expecting to see foodservice operators demanding new technologies to answer the ‘new normal’ needs.

The full research can be downloaded here.

Photo: Shutterstock