|
(May 14, 2009) The Old Farmer’s Almanac is predicting a cooler-than-normal summer in Canada, which could be a bad omen for foodservice sales in the months ahead.
With the economy mired in a recession and fewer American tourists travelling to Canada, foodservice operators should brace for a challenging summer. Commercial foodservice sales are forecast to fall 2.6% in the second quarter of 2009 compared to a year earlier, and will continue to slide through the third quarter before starting a slow recovery at the end of this year.
Since the start of the recession late last year, foodservice sales in Canada have slowed – falling from 4.3% growth in the third quarter of 2008 to 2.6% growth in the fourth quarter. Sales in the first quarter of 2009 were relatively flat due to rising unemployment and lower disposable income, and are forecast to weaken in the short term with a 2.6% decline in the second quarter.
Although sales will continue to slide through the third quarter with a 2.5% decline, sales in the final quarter of the year will slip by just 0.4% as economic activity slowly improves. Sales move back into positive territory in the first quarter of 2010, with a forecast of 0.8% growth over the first quarter of 2009. Foodservice sales will make modest gains in 2010 as a high unemployment rate and sluggish disposable income growth will continue to restrain consumer spending.
While all foodservice segments will be affected by the recession, full-service restaurants and caterers will be the hardest hit. As in past recessions, some consumers will trade down from full-service restaurants to limited-service restaurants, while others will trade out to grocery stores and supermarkets.
Overall, commercial foodservice sales in Canada are forecast to fall by 1.5% in 2009 before expanding by 2.0% in 2010.
Forecasts referenced in this article are based on CRFA’s econometric model of the foodservice industry, which includes the latest forecasts of economic growth for Canada. CRFA’s complete Long Term Foodservice Forecast (2010-2013) includes a year-by-year projection of commercial foodservice sales by segment and by province, as well as expanded coverage of the Canadian economy and the U.S. foodservice forecast.
|
