Noncommercial sector to grow moderately in 2016, NRA says

Published in FSD Update

Peter Romeo, Director of Digital Content

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Sales at self-operated noncommercial foodservice facilities will grow this year by a collective 2.6 percent, or just slightly above the rate of price inflation, according to a forecast released yesterday by the National Restaurant Association.

Noncommercial operations managed by contractors will fare better, with a projected sales increase of 3.8 percent, or 1.1 percent in deflated or “real” terms, the association says.

The numbers do not indicate much of a shift in market share between contractors and self-ops, as privately managed facilities are called. The NRA projects that contractors will snag about 46.1 percent of all noncommercial sales, with the remaining 53.9 percent collected by self-ops. The market shares for 2014 were 45.8 and 54.2 percent, respectively.

The $3.35 billion increase in total noncommercial sales, to a new record level of $107.16 billion, will not be distributed evenly across the market’s segments, according to the NRA.

It predicts that employee feeding, or what’s known as the business-and-industry or B&I segment, will enjoy the steepest sales growth, with a projected increase of 3.8 percent in nominal terms or .9 percent when deflated. However, that sector will remain the smallest in the noncommercial channel, with forecast total sales of $12.30 billion.

Healthcare feeding will grow by 2.5 percent, to $33.23 billion, the association predicts. It categories nursing homes and continuing care facilities as belonging within the sector.

The NRA measures school foodservice and college and university feeding as one classification: education foodservice. It foresees that market growing at 3.2 percent, to $38.66 billion.

But it does differentiate between contract-managed and self-operated facilities within the so-called K-12 and C&U sectors.

C&U foodservices managed by third parties should enjoy a sales pop this year of 4.1 percent, or 1.4 percent in real terms. That compares with a projected increase of 3.2 percent for self-ops.

In school foodservice, self-ops are expected to collect 1.7 percent more in sales, compared with a 2.3 percent rise for contract-managed services.


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