• University of Michigan East Quad in Ann Arbor

  • Yale’s Dining Ventures West

  • Sales at Chicken Restaurants Ready to Take Flight Again?

  • DSR of the Month, July 2014: Chris Monico, Senior Project Manager C&T Design & Equipment Co., Indianapolis

Foodservice News

Read more Foodservice News

Blog Network

jCarbonara
Joe Carbonara

Summer Scholars

If you saw the cover of this issue promoting our coverage of college and university foodservice innovators and thought the July edition of FE&S is not for you, think again. What's happening in college and university foodservice today will shape other foodservice industry segments for years to come.

Read more...

jMartinez
Juan Martinez

Designing for Flexibility: How Much Can You Afford Not to Do?

Many factors come into play when designing a restaurant. The décor and ambience represent obvious considerations but one design element many concepts fail to consider is building flexibility into the front-of-house, middle-of-house and back-of-house designs.

Read more...

jStiegler
Jerry Stiegler

NPD’s Restaurant Market Overview, McD’s 18-Month Plan, Fast Food Employees Organizing Efforts and More

This Week In Foodservice reports on The NPD Group’s overview of the restaurant market, looks at the possibility of civil disobedience protests at restaurants, provides comparable store sales reports for a number of major chains and a whole lot more.

Read more...

Greg Christian
Greg Christian

Outcomes for Year One of a New, Self-Op School Lunch Program

As the 2014-2015 school year draws to a close, I'd like to share the final outcomes of Nardin Academy's new self-operated foodservice program.

Read more...

Highlights

Making Sense of the Improved Business Environment

The economic news continues to be mixed, so what does that mean for the foodservice industry?

Despite the fact that most observers feel the U.S. recession is over, the economy remains one of the most discussed and dissected topics today. Both political parties like to treat the economy as if it were a piece of shapeless clay, as they try to mold the country's economic performance to suit their own agendas. That leaves people like me, who are not economists and have never even played one on television, trying to develop a better understanding of today's business environment.

That's probably why I was one of the people in the audience who gladly soaked up a presentation by Forbes columnist Rich Kaalgard during the 2011 FEDA Convention in Phoenix. I thought Kaalgard did a great job of putting the current economic climate into context, something that seems to be generally lacking these days.

For example, Kalgaard projects that the U.S. will experience 3 percent to 3.5 percent economic growth this year, but few businesses will grow by that amount. Some will be up a lot more than that, while others will continue to see their sales decline. "The individual number almost does not matter," he said. "Individual company by individual company the results are so uneven that the growth number is an aggregate."

Still, the alarmist in all of us wants to portray the just concluded recession as the worst thing since the Great Depression of the 30s. But Kalgaard made a case that this cycle is much more similar to what happened in the 70s, another challenging economic period in our country's history. "We downplay the 70s because the 80s and 90s were so robust," he said. "There was a happy ending, but we don't know how this will end."

But the 70s were good for one thing--startups. Kalgaard pointed out that's when U.S. business leaders such as Federal Express, Southwest Airlines, Microsoft Corp. and Apple Computer first emerged. "The list goes on and on, and you realize that it was not a bad time for everyone," Kalgaard said.

That's something the foodservice industry experienced last year, for example. This is evident when looking at FE&S' 2011 Distribution Giants Study, where 56 companies reported an increase in sales, while 35 reported a decline in sales and 10 reported their revenues were flat year over year. So just because the overall revenue generated by the top 101 dealers (there was one tie resulting in the extra company being listed) increased by 2.96 percent, that does not mean everyone grew by that rate.

So what can we learn from the recent economic malaise? "When the tide goes out, the business models that are too slow and too bloated get exposed," Kalgaard said. "And when this happens, companies with newer business models begin to thrive."

So as the tide begins to rise, how's your business model? Is it ready to meet the challenges of the day?

Related Articles

Foodservice Equipment & Supplies is proud to be the exclusive media sponsor for 2014 RestaurantPoint.

Restaurant Point - Innovating the restaurant experience