The Food Services Key Metric Analysis is designed to provide the market dynamics and associated key elements that encompass the operations of Food Service operations and its sub-categories. For the purposes of providing a "baseline trend" the below data provides a guideline on market operational dynamics, trends, developments and SWOT analysis.
The below analysis primarily relates to Americas and EMEA but can also be used as an indicative guide for the APAC region as well.
Updates will occur at least semi-annually, but more frequent as market conditions change based upon market variability, criticality of events and velocity of market conditions, such as inflationary increases / resource and material availability.
Overview
FS-053 Ver 2.2 (May 24)
Buyer Power Score
Buy LATER
The current market power score for Food Services and Catering is -1.0 for the average across 2021-2024 period but is expected to improve in 2023 resulting in stronger negotiating positions.
Market Dynamics
Price Trend
(2021-2024) (CAGR)
Price Forecast
(2024-2027) (CAGR)
Supply Chain Risk
ESG Level
1.3 %
0.8%
High
Low
Top 5 Global Suppliers (CBRE)
AMERS
EMEA
APAC
Compass
Aramark
eZcater
Bon Apetit
Best Vendors
Compass
Baxter Storey
Sv Schweiz
KSG Catering
CH & Co Catering
Compass
Coffee Day Global
Sodexo (comp)
Mountain Trail Foods
Vendiman
Recent Developments
Positive Trends
Neutral Trends
Warning Trends
None to Report
New EU Laws impact Supply Chains regarding Human Rights issues
Labour shortages
Market wage adjustments
Buying Power Levers
No Buyer Threat
To Investigate
Threat to Buyer
Total Market Coverage-Top 4
- Top 4 only cover less than 30% of Market
- Customised solutions rarely used
- Few costs when switching suppliers
Supplier Risk: Med-High
- High risk of Supplier insolvency
Substitute suppliers: MED
- Relative lowh number of potential alternatives available
Price Driver Volatility: HIGH
- Price drivers in last 2 years have fluctuated extensively
SWOT Review
Strengths
Weaknesses
- Market Share Concentration is low indicating that suppliers are willing to engage in price-based competition to win new business.
- The market offers ample opportunities for sourcing from women-, veteran- and minority-owned businesses,which makes it easier for buyers to meet their diversity metrics and values.
- Product specialization is low in this market, which indicates that most suppliers are qualified and able to render products or services.
- The Catering Services market has a high level of supplier financial risk, indicating that suppliers in this market face a high threat of bankruptcy which could cause disruptions for buyers
- Buyers experience some unexpected or hidden costs in this market.
- Moderate total cost of ownership increases the difficulty of budgeting for these costs beforehand
Opportunities
Threats
- Prices for Catering Services have displayed low price volatility. As such, buyers can expect a level of predictability that allows them to better anticipate prices and plan accordingly
- The average profit margin in this market is moderate, which means that suppliers may be willing to negotiate down their prices
- Wages are forecast to increase quickly during the next three years
- Supply Chain risk is Medium to High due to potential risks in obtaining equipment on time
- Shortage of Labour continues to threaten efficiency of operations
Source data: Procurement IQ 60454545 2024
Source data: CBRE Spend Cube-May 2023
Cost Structure review
WAGES
OVERHEADS
(2021-2024)
(2023-2026) Forecast
(2021-2024)
(2023-2026) Forecast
12-15 %
9-10 %
3.5 %
2.5 %
Wages have been increasing on average despite a decline during COVID-19. Increased commercial activities and tight labor conditions have been incentivizing employers to raise wages to attract more workers, placing upward pressure on costs
In the next three (3) years, wages are expected to continue rising as commercial activity continues growing despite rising interest rates. This trend is expected to put further upward pressure on market prices
The price of professional indemnity insurance has been rising in line with growing business activity prompting suppliers to pass these costs on to buyers
Overhead costs are forecast to continue growing in the next three (3) years. As these costs continue to rise, suppliers will pass a portion of the costs to buyers
VOLATILE