Unique foods and demand from metropolitan areas will sustain demand for the industry
Los Angeles, CA (PRWEB) August 12, 2012
During the past few years, the Street Vendors industry surged ahead because of new consumer demand for unique and gourmet food trucks. According to IBISWorld industry analyst Nima Samadi, “this trend gained momentum as the fast food and food-service industries slowed down significantly due to changing consumer tastes and a struggling economy.” Over the five years to 2012, IBISWorld expects that industry revenue will grow at an average annual rate of 8.4% to $1.5 billion. As the food truck craze took hold, revenue jumped 6.1% in 2008 to $1.1 billion and again in 2009, rising 9.5% to $1.2 billion. The trend hit its peak in 2010, reaching growth of 12.7%, underpinned by an influx of innovative products and attention to niche demands. As the craze begins to subside, growth is forecast to slow slightly in 2012, rising 4.2% for the year.
During times of low economic activity, consumers spend less on luxuries like eating out; when they do, they typically opt for lower-priced items. However, even fast-food restaurants have increasingly lost to home-cooked meals in the battle for business from cash-strapped consumers. In addition, the general trend toward healthy eating over recent years has hurt sales in the Street Vendors industry, which often serve greasy meals. Yet despite shrinking budgets and an increasingly health-conscious consumer base, renewed fascination with street foods in the US has offset some of these trends. “Moreover, a number of gourmet and specialty food trucks have opened over the last few years to cater to customers who want healthier options,” says Samadi. Because of the surge in demand for food trucks, industry employment has grown steadily over the five years to 2012. The Street Vendors industry's market share concentration has been somewhat stable due to the popularity of sole proprietors. However, from 2007 to 2012, the numbers of establishments and enterprises have risen aggressively, though at a slower rate for enterprises. This discrepancy reflects the growing popularity of franchise agreements among street vendors. Industry concentration is expected to be relatively stable over the next five years as well, only continue to increase marginally.
Food truck and street food vendors are increasingly investing in specialty, ethnic and fusion (e.g. Mexican and Korean combination) food. Many operations have grown strongly over the past few years and outperformed traditional industry operators. Despite this surge in demand, growth is expected to slow down over the next five years as America's sudden fascination slowly subsides. As such, revenue is projected to grow at a slower pace in the five years to 2017 than it did over the past five eyars. However, there are still opportunities for sustained growth in major metropolitan areas that can support the rush of interest that the industry has benefited from during the past five years. For more information, visit IBISWorld’s Street Vendors in the US industry report page.
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IBISWorld industry Report Key Topics
This industry comprises establishments primarily engaged in preparing and serving meals and snacks for immediate consumption from motorized vehicles or non-motorized carts. The establishment is the main location from which the caterer route is serviced, not each cart or vehicle. Included in this industry are establishments primarily engaged in providing food services from vehicles, such as hot dog carts and ice cream trucks.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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