LONDON--(BUSINESS WIRE)--Technavio has announced the top eight leading vendors in their recent foodservice market in the US report until 2020. This research report also lists 19 other prominent vendors that are expected to impact the market during the forecast period.
Competitive vendor landscape
According to the report, the foodservice market in the US is highly fragmented with the presence of many small and large players. As a result, there is intense competition among the market vendors across all regions on the basis of product differentiation, portfolio, and pricing and the competition in the market is expected to intensify in the coming years.
“Due to the increasing competition, the vendors are reducing their product prices, which could negatively affect vendor margins and market growth. Some of the companies in the market are more specialized than others with respect to particular commodities and financial resources,” says Arushi Thakur, one of Technavio’s food and beverage research expert.
The report also states that the rising competition and aggressive promotions can create diminishing margins for foodservice vendors in the US. Intense competition among vendors, along with rapid technological changes, constitutes significant risk factors to vendor operations. Several vendors are adopting M&A strategies to increase their market shares. Hence, to survive and succeed in a stiff competitive environment, it is imperative for vendors in the market to distinguish products and service offerings through a clear and unique value proposition.
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Top eight foodservice market vendors in the US
Aramark
Aramark, formerly Automatic Retailers of America, was established in 1959. It is headquartered in Philadelphia, Pennsylvania, US. It provides food, facilities, and uniform services to a wide variety of industries including healthcare, education, sports and entertainment, and corrections. As of September 2014, the company had approximately 272,000 employees (162,000 full-time employees) working across the Americas, Europe, and APAC.
It is the second leading company in North America and among top three companies in the UK, Chile, China, Japan, Ireland, and Germany in the food, facilities, and uniform segment. The company operates in three segments: food and support services – North America, food and support services – international, and uniform and career apparel.
The company reported strong financial performance for FY2013 and FY2014, and the net sales generated were USD 13.9 billion for FY2013 and USD 14.8 billion for FY2014.
Compass Group North America
Compass Group North America is headquartered in Charlotte, North Carolina, US. The company operates as a key provider in the food and support services. In FY2014, the company's total revenue was USD 13.6 billion, and it employed more than 220,000 associates in the US and Canada. The company has also served as an official provider of catering services in 2002 Olympic and Paralympic Winter Games in Salt Lake City.
The company offers its services under various brands. These brands range from company-owned brands to regional brands to international brands. Some of them are:
- Balance Kitchen: It is a new innovative café concept that promotes healthy and sustainable food choices through a variety of fresh and local options.
- Chef jet: It offers quick-service concept by celebrity chef Jet Tila. This brand only deals with Asian cuisine such as noodles, lean meat, crispy vegetables, and rice.
- Simply Puur: It offers fresh food products.
Domino's
Domino's was founded in 1960 and is headquartered in Ann Arbor, Michigan, US. It is a pizza restaurant chain. Its product offerings include handmade pan pizza, oven baked sandwiches, and complementary side items such as cheesy bread and chocolate lava crunch cakes, as well as beverages. The company sells over 1.5 million pizzas every day worldwide. It has operations in over 11,600 locations in more than 75 markets. As of December 2014, the company had 11,000 employees, and its revenue was USD 1.99 billion.
Domino's is the second-largest pizza firm in the world. Its Domino's Pizza brand is a recognized consumer brand worldwide. For the past five years, its US franchise and company-owned stores invested USD 1.5 billion in co-operative, national, and local advertising. Its international franchisees also invest major amounts in advertising efforts in their markets. It continues to strengthen its brand with extensive advertising through various media channels. The company also improved the strength of its brand through marketing affiliations with Coca-Cola.
McDonald’s
McDonald’s is a global hamburger restaurant group based in the US. The company was founded in 1940 by Richard and Maurice McDonald. McDonald’s is the world's largest fast food restaurant chain in terms of revenue, serving about 69 million customers each day in over 100 countries. McDonald’s restaurants offer a substantially uniform menu, with a few geographic variations that include a range of hamburgers and cheeseburgers, French fries, Big Mac, Quarter Pounder, Chicken McNuggets, Filet-O-Fish, sandwiches, wraps, French fries, salads, oatmeal, shakes, McFlurry desserts, sundaes, cones, pies, soft drinks, coffee, and McCafe beverages.
As of December 2014, McDonald’s operated 36,258 restaurants, of which 29,544 were franchised (including 20,774 franchised to conventional franchisees, 5,228 for developmental licensees, and 3,542 licensed to foreign affiliates) and 6,714 were operated by the company in 119 countries, serving about 69 million customers every day. McDonald's operates restaurants in the US, Europe; Asia/Pacific, Middle East, and Africa (APMEA); and other countries, which include operations in Canada and Central America and South America. In FY2014, the company generated 40% of the total revenue from Europe, followed by the US (32%), APMEA (23%), and other countries and corporate (5%).
Restaurant Brands International
Restaurant Brands International was founded in 2014 and is headquartered at Oakville, Ontario, Canada. The company operates over 18,000 restaurants in 100 countries under Tim Hortons and Burger King brands.
As of December 2015, the company under TH brand owned or franchised 4,413 restaurants (3,650 in Canada, 650 in the US, and 113 in the Middle East). Of these restaurants, 4,389 were franchised and 24 were company-owned. Under BK, the company owned or franchised a total of 15,003 Burger King restaurants in approximately 100 countries worldwide. Of these restaurants, 14,927 were franchised and 76 were company-owned.
Starbucks
Founded in 1971, Starbucks is headquartered in Seattle, Washington, US. It is a coffeehouse chain that markets and sells handcrafted coffee, tea, and other beverages. It also provides a variety of fresh food offerings such as pastries and breakfast sandwiches. It operates in 68 countries and is a premier roaster, marketer, and retailer of specialty coffee.
In 2015, foodservice contributed 3% of the total revenue. The company markets Seattle’s Best Coffee and Starbucks' roasted whole bean and ground coffees, a range of Starbucks VIA Ready Brew, premium Tazo teas, and other related products to the institutional foodservice enterprises that service business and industry, healthcare and education institutions, hotels, restaurants, airlines, office coffee distributors, and other retailers. The company also sells its Seattle’s Best Coffee via arrangements with national accounts. The maximum sales in this channel is through nation-wide distribution networks with U.S. Foodservice, SYSCO Corporation, and other distributors.
Subway
Subway was founded in 1965 and is headquartered in Connecticut, US. It is owned and operated by Doctor's Associates. It has 44,090 restaurants in 100 countries.
Subway launched NFC (near-field communication)-based mobile payments with Softcard. This mobile wallet is a joint venture of Verizon Wireless, AT&T Mobility, and T-Mobile US.
In 2015, Subway launched Wi-Fi loyalty program in collaboration with Turnstyle Solutions (a Toronto-based company that specializes in monetizing Wi-Fi installations). Under this program, the customers in Canadian Subway locations will be offered free sandwiches if the customers log into the in-store Wi-Fi network. The company is also launching new products to increase the customer base in the food and services sector.
Yum! Brands
Founded in 1997, Yum! Brands is headquartered in Louisville, Kentucky, US. The company, through its subsidiaries, serves the quick-service restaurants. It operates, franchises, and licenses a system of quick-service restaurants that prepares, packages, and sells food items.
Yum! Brands is one of the fastest growing retail developers in China with KFC, Pizza Hut Casual Dining, and Pizza Hut Home Service. Its major restaurant brands are Pizza Hut, KFC, and Taco Bell that offers chicken, pizza, and Mexican food categories.
In October 2015, Yum! Brands announced plans to separate its business into two independent and publicly-traded companies, Yum! Brands and Yum! China. Each of them will have distinct strategies and investments.
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