Commercial Refrigeration Equipment

Report Overview

14th Edition

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This study analyzes the United States market for commercial refrigeration. Products included are:

• transportation refrigeration systems, which:
  • include those installed on trailers, shipping containers, and trucks
  • exclude containers that house food and beverage products for transport
• reach-in and walk-in refrigerators and freezers
• beverage refrigeration equipment, including:
  • drinking fountains, which include those with integrated water bottle filling stations but exclude non-integrated and standalone water bottle filling stations (those are included in the value of all other commercial refrigeration equipment)
  • soda fountain equipment
  • beverage cooling and dispensing equipment, including pre-mix and post-mix dispensers
  • beer dispensing equipment
• display cases, including normal temperature (which encompass multiple shelf cases with glass doors used to store beverage cans and bottles) and low temperature types available in open or closed configurations
• ice machines, including those that make cubes, flakes, and nuggets and dedicated units and combination ice makers/dispensers
• liquid chillers, including absorption, centrifugal, and reciprocating types
• cryogenic equipment, including controlled rate freezers, liquid nitrogen coolers, and mechanical coolers
• refrigerated vending machines
• miscellaneous equipment, including non-integrated and standalone water bottle filling stations, compressor racks (or compressor systems), dairy coolers, egg refrigerators, and refrigerated food prep stations
• associated parts and attachments

Markets included are:

• food and beverage retail establishments, including convenience stores, mass merchandisers, and supermarkets, as well as farmers’ markets, produce markets, and other specialty food shops
• foodservice, or the service of food to paying or nonpaying customers by restaurants and bars, airlines, company cafeterias and canteens, daycare facilities, food trucks, government facilities and military sites, institutional establishments, lodging and hospitality establishments, and sports and recreation venues
• food and beverage distribution, which encompasses:
  • farms and warehouses that store food that is awaiting shipment
  • transportation networks – which utilize shipping container, trailer, and truck refrigeration systems – that ship the goods to the end user
• food and beverage production, including farms and processing plants
• other markets, including the non-foodservice operations of hotels and motels; medical and scientific establishments; office buildings; pharmaceutical manufacturing plants; and sports venues

The outbreak of COVID-19 in the US is expected to have a mixed effect on commercial refrigeration equipment in 2020, with the overall impact expected to be a slight decline compared to 2019.

Key Findings in the Commercial Refrigeration Equipment Study:

Demand for commercial refrigeration equipment in the US is expected to increase 2.7% per year through 2024 to $11.7 billion, supported by continued upgrades and replacement of aging systems, as the large existing stock of equipment results in most sales being replacement oriented.

The continued introduction of high-end equipment that improves product performance and efficiency or that includes technological features that appeal to shoppers (such as interactive displays) will also contribute to value growth.

Shifting Consumer Shopping Trends Providing Opportunities for Refrigeration

Consumer shopping patterns are trending toward e-commerce and in-store or curbside pickup, which remain a key investment area for equipment suppliers serving the foodservice, food and beverage retail, and food and beverage distribution markets:

• In foodservice, the growing number of establishments collaborating with food delivery apps enables these establishments to maintain or expand revenue opportunities, especially as the number of consumers dining in restaurants declines.
• In retail settings, operators are adding display cases or reach-ins at the front of the store to display products to consumers awaiting pick up. New retail establishments are also being designed to include additional refrigeration equipment needed to keep in-store and curbside pickup orders fresh while they await fulfillment.
• In the distribution market, suppliers are investing in expanding the infrastructure needed for e-commerce purchases and fresh food delivery because of the substantial untapped potential. There are still logistical and consumer perception concerns that need to be addressed before delivery of perishable food items is common, but, over the long term, demand for refrigerated equipment is likely to shift from retail to distribution as more food purchases are made via e-commerce rather than in physical stores.

Ban on R-22 to Have Small – But Not Significant – Impact on Equipment Sales Through 2024

Beginning in January 2020, there is a total ban in the US on the production or import of virgin R-22. However, there is still a significant stock of virgin and reclaimed R-22 in the US that can be used to service existing equipment. As a result, prices for the refrigerant are not expected to increase significantly in the short term, allowing many owners of R-22 based equipment to postpone replacing their systems for now.