Recreation foodservice seeks to restore profits

A 2.6% decrease in sales is rarely considered good news, but for the recreation foodservice segment, 2010’s decrease was actually a big improvement over the prior year’s nominal decline of 10%.

The industry, hit hard by the recession’s lingering effects, has continued to struggle as discretionary spending remains down from pre-recession levels. The recreation segment had retail-sales-equivalent food and non-alcoholic beverage revenues of $15.8 billion dollars in 2010. One way the industry is seeking to restore profitability is by expanding and tailoring foodservice offerings to attract clients venturing out and seeking the most bang for their buck.

To help companies understand where opportunities lie in the recreation industry, Technomic has developed the Recreation Foodservice Report. Findings include:

•Casinos/gaming—After two years of revenue declines, the gaming industry is starting to show signs of growth. Las Vegas, in particular, is benefiting: For the past 16 consecutive months, the number of visitors to the city has increased, according to the Las Vegas Convention and Visitors Authority.

•Cruise ships—The number of worldwide cruise-ship passengers increased steadily between 2007 and 2009, reaching 13.4 million in 2009—up 3.0% over 2008.

•Theme/amusement parks—Operators are working to underscore the special qualities of going to a theme park versus other entertainment venues, efforts that often include aggressive promotions involving lodging and food packages, discounts for prepaid food, and all-you-can-eat special deals.

•Stadiums/arenas—Attendance is down in some but not all markets for major sports, and this remains one of the segment’s strongest subsections.

•Sports clubs—Memberships in city, golf, and yacht clubs are down. As a result, food-and-beverage revenues (that account for almost 30% of an average private club’s income) have declined.

•Movie theaters—Despite the growth of Red Box vending machines, movies by-mail and streaming options, and myriad online video sites, box-office sales have grown by 20% nominally from 2005 to 2010.

•Museums—Attendance is down for all fine-arts categories, and museums also are being pinched by reduced donations and civic support.

•Bowling and entertainment centers—A few chains, such as AMF 300 and Splitsville, are moving ahead with plans to open centers where quality dining is the primary draw and bowling alleys are secondary.

•Zoos, race tracks, and others—With declining admissions, these sectors have responded by reducing ticket prices to draw traffic, promoting foodservice facilities as a reason to visit, and offering more trend-forward food and beverages.

Access www.Technomic.com to purchase or learn more about this report.

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