Hotel & Restaurant Equipment
Industry Sector NAICS Code 2008 U.S. Exports
The Hotel and Restaurant Equipment industry manufactures specialized equipment for use in commercial and institutional kitchens and residential accommodations, including hotels, restaurants, resorts, catering businesses, schools and colleges, hospitals, nursing homes and assisted living facilities, and similar settings. Major product categories include: ovens, stoves, ranges and other devices for heating food or keeping it warm; refrigerators, freezers and other devices for keeping food cold, including refrigerated and freezer-type display cases, and refrigerated equipment for dispensing beer and carbonated beverages; ice-making machines, dishwashers; vacuum cleaners; washing and drying machines for clothes, table and bed linens, etc., porcelain and other ware for serving food; and specialized furniture for hotel, restaurant, and other commercial applications. Also covered in this category, but difficult to document statistically are small commercial kitchen appliances, hair dryers, clothes irons, cutlery, and similar products.
Industry Overview and Competitiveness
More than 500 companies of all sizes manufacture hotel and restaurant equipment in the United States. Many of the leading brands of high-value product types are concentrated in the hands of large corporate manufacturers with multiple brands and subsidiaries, such as Illinois Tool Works, Manitowoc Company, Inc., and True Food Service Equipment. Frequently, these and other large manufacturers produce equipment for preparing hot foods and beverages, or for storing and displaying cold foods and beverages, as well as dishwashers, vacuum cleaners, and other motor-driven devices. There are also numerous small and medium-sized manufacturers, frequently offering innovative products or serving particular market niches. Major end-users of hotel and restaurant equipment include restaurant and hotel chains, schools and colleges, hospitals and other residential health-care providers, commercial caterers, and other institutional customers. Franchise restaurant chains, especially in the fast-food sector, are especially important for large-scale sales and repeat business. Because the hotel and restaurant markets depend heavily on discretionary spending, the market for equipment is especially sensitive to economic downturns. State and local government end-users, such as schools and colleges, are also sensitive to economic conditions that reduce tax revenues on which their budgets depend, although other institutional end-users may not be quite so vulnerable.
The hotel and restaurant equipment industry is a mature and highly competitive global business. Major markets for hotel restaurant equipment include North America, the European Union, East Asia, and the Middle East. U.S. exports grew steadily between 2004 and 2008, totaling $1.8 billion last year. International competition is strong in this industry sector, however, and imports in 2009 were worth $2.1 billion. Leading U.S. manufacturers compete with counterparts from Italy, Germany, Sweden, Japan, and other developed industrialized nations. Conditions in more populous and affluent markets often lead manufacturers to localize manufacturing. Both the volume of local sales and specific national standards and other requirements for electric current, natural gas connections, food safety and so on are some of the reasons for localizing production.
With its large and affluent population, the United States has tens of thousands of hotels, restaurants, and other commercial and institutional end-users of hotel and restaurant equipment. Hundreds of domestic and international firms serve this market, both from domestic manufacturing operations and with imports. Major U.S. manufacturers include Illinois Tool Works, Inc., Manitowoc Company, Inc., True Food Service Equipment, Cambroon Manufacturing Company, and the NACCO Housewares Group, to name a few. Leading foreign manufacturers doing business in the United States include ALI SpA (Italy), AB Electrolux (Sweden), Franke Holding AG (Switzerland), Hoshizaki Electric Company, Ltd. (Japan), Meiko Maschinenebau GmbH (Germany).