US Commercial Refrigeration Equipment Demand to Reach $9.4 Billion in 2014

Demand for commercial refrigeration equipment in the US is forecast to rebound through 2014, growing 7.2 percent per year (including price increases) to $9.4 billion.  Demand in 2009 was drastically impacted by the US recession, which caused food industry participants to postpone capital improvements and expansions.  Advances will result from an improving capital investment outlook, as economic recovery encourages end users to renovate or expand existing facilities.  Consumers’ busy lifestyles will also continue to spur gains, as retailers offer a wider range of convenient “grab and go” options, as well as a broader variety of frozen foods.  These and other trends, including market share and product segmentation, are presented in Commercial Refrigeration Equipment, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm.

Growth will be strongest for transportation refrigeration equipment, which will post double-digit gains.  Even more so than other categories, demand for these products was devastated by the poor capital investment environment in 2009.  Fleet operators, faced with narrow profit margins, postponed fleet expansions and upgrades due to the high per-unit cost of new equipment.  Demand for beverage refrigeration equipment and ice machines will benefit from the rising number of eating and drinking establishments.  Display cases, especially models that offer mobility and flexibility, will post improved gains.  Demand in all product categories serving food related markets will be strongest for equipment that is energy efficient, as companies throughout the entire food industry will seek to reduce operation costs.  Rising medical research expenditures will spur demand for cryogenic equipment.

The distribution market will post the strongest gains of any segment through 2014, reflecting recovery in fixed investment levels by fleet operators.  Foodservice is expected to remain the largest market for commercial refrigeration equipment through 2014, as Americans will continue to spend nearly one-half of their food budget outside the home.  Opportunities in the retail market will result from the rising number of food retailers. In addition, the average amount of floor space at food retail outlets will rise, creating potential for more refrigeration equipment per store. 

The Freedonia Group is a leading international business research company, founded in 1985, that publishes more than 100 industry research studies annually. This industry analysis provides an unbiased outlook and a reliable assessment of an industry and includes product segmentation and demand forecasts, industry trends, demand history, threats and opportunities, competitive strategies, market share determinations and company profiles.