CHICAGO — The financial outlook for the U.S. foodservice industry remains bleak as the coronavirus ravages convenience stores, restaurants, supermarkets and other food providers.
In late March, the expected year-over-year nominal decline for U.S. foodservice in 2020 was between 11% and 27%, according to CSP’s sister research firm, Technomic. Although the worst-case scenario remained the same as of late May, the best-case scenario jumped to 18%. Technomic’s most recent numbers collected during the first week of August indicate that U.S. foodservice could fall between 24% and 29% in 2020—equivalent to about $250 billion to $300 billion dollars lost across all channels.
Technomic has also outlined three possible scenarios specific to convenience-store foodservice through the remainder of 2020: At best, c-store foodservice sales could decline by about 19% compared to 2019; in the middle, it sales could fall more than 22%; and in its worst-case scenario, sales would drop 26%. C-store foodservice estimates are far worse than supermarket foodservice, which faces 8%, 10% and 12% best, middle and worst-case scenario declines, respectively, according to Technomic.
“Few industries have felt the repercussions of the COVID-19 pandemic quite like foodservice,” said Joe Pawlak, managing principal for Technomic, Chicago. “Restrictions are wreaking havoc, especially on the segments that depend upon on-premise consumption.”
Despite these substantial losses, Technomic predicts that the foodservice industry will bounce back in 2021. For total U.S. foodservice, the best, middle and worst-case scenarios for next year include dollar increases of 29%, 26% and 23%, respectively. For convenience stores, those growth estimates are currently 36%, 31% and 26%, respectively.
“What we are seeing is continued decline for the remainder of the year but aggressive growth in 2021,” Pawlak said. “However, it will still take longer to fully bounce back, and we’ll be updating our forecasts as circumstances continue to shift and evolve.”
Technomic is releasing weekly updates from original research as the COVID-19 situation continues to unfold.