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          1. Food Service Contractors Industry Profile

            Report Page Length: 10-12
            Last Quarterly Update: 9/21/2020
            SIC Codes: 5812
            NAICS Codes: 722310
            Chapters Include:
            Industry Overview Trends & Challenges Industry Forecast
            Quarterly Industry Update Call Prep Questions Website & Media Links
            Business Challenges Financial Information Glossary & Acronyms
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            Excerpt from Food Service Contractors Industry Profile

            Companies in this industry contract to provide food services at commercial, institutional, and governmental locations. Major companies include Aramark and Delaware North (both based in the US), as well as Autogrill (Italy), Compass Group (UK), Elior Group (France), Sodexo (France), and SSP Group (UK).

            The global market for on-site food services at businesses, hospitals, schools, and entertainment venues is worth about $270 billion, more than half of which is outsourced to third-party contractors, according to Compass Group. Key growth markets for the industry include China, India, Japan, Spain, Ireland, and Germany. Weak economic conditions have stalled growth in Brazil in recent years, but the industry continues to expand in Latin American markets. Development of luxury hotels and tourist attractions in the United Arab Emirates and Qatar is increasing demand for contract food services in the Middle East.

            The US food service contracting industry includes about 31,000 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $48 billion.

            COMPETITIVE LANDSCAPE

            Demand is driven by employment trends and consumer tastes. The profitability of individual companies depends on efficient operations and food quality. Large companies have advantages in economies of scale in food and equipment purchasing, off-site food preparation, and distribution. Small companies can compete effectively by specializing in unique food products or local markets. The US industry is highly concentrated: the 50 largest companies account for about 90% of revenue.

             
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