In economically tough times, the catering equipment industry more often than not turns to used appliances, with second hand equipment dealers seeing an upturn in sales during these periods.
But will the same prove to be true after we head out of the unprecedented coronavirus pandemic and the lockdown it has necessitated?
One dealer in the pound seats could be Peterborough-based second hand specialist, Caterquip. MD Dominic Ricciardi recalled: “We always notice in times of recession, unrest or instability and now a pandemic that business gets better for us.
“In the very early weeks of the outbreak we were extremely quiet, due to I suppose people not knowing what was going to happen and everyone taking the government guidelines seriously. But then from April we noticed an increase in enquiries so demand has got greater.”
Ricciardi can see some positives in the current situation: “As the phones have not been too busy I have had time to personally speak to the customer and ask them questions, and overall they all seem optimistic about the future. A lot have changed their business into takeaway/collection and they are realising this may be the way forward as social distancing will remain for some time more, and more people will be eating at home, and worried maybe about socialising in bars and restaurants.”
The Caterquip owner believes there will be increased demand for second hand equipment, explaining: “The obvious reason being the cost savings that people can make, as with the instability people will be watching their pennies. People also realise that there will be a lot of fallout from this and there will sadly be many places closing down, so the customer will know that there will opportunities out there to buy decent kit and save a lot of money in the process.”
Nevertheless, he cautioned: “There is however a lot of stigma still attached to buying reconditioned /second hand equipment, so people will still buy new.
“In my overall opinion, I don’t think the hospitality industry will be back on its feet for at least 18 months – 2 years and even then maybe only 80% of pre-pandemic numbers.”
At local rival Caterfix, MD Ajaz Akhtar reported: “The demand for second hand catering equipment is the same for all catering equipment at the moment: very slow. This is mainly because the vast majority of customers are closed. They are also not prepared to visit our warehouse because for lockdown rules. I cannot see the situation changing until the government eases the lockdown rules.”
However, he believes that going forward, more operators will patronise the second hand market: “Second hand equipment tends to be a good option when budgets are tight and customers are looking for a much cheaper option. Customers will be very cautious on all spending after the lockdown ends so may well turn to second hand catering equipment to see how the land lies until they are more confident of the future.
“One thing is for sure, the accessibility of second equipment will be immense if a lot of places close as we face an uncertain future in our industry. Mind you there is never a shortage of supply in this particular sector, it’s the selling bit that is more difficult!”
Removal and recycling
What happens when catering equipment is no longer needed? There is a steady band of specialist removal and recycling companies on hand to ensure that these appliances can be properly disposed of, and they may find themselves in high demand over the coming months.
One business, Recycling4you, has started seeing more requests, after only receiving a few during most of March and April.
MD Paul Waygood detailed: “We are only now seeing shops and restaurants closing and needing to recycle the equipment. I expect this to increase as there will possibly be a glut of equipment for sale but not as many buyers.
“I do expect the level of recycling requests to increase but only once business have tried to sell online possibly either by auctions or eBay and failed to sell the equipment due to most hospitality not being able to open except for takeaway.”
During lockdown, the firm has had to alter its procedures, providing masks and hand sanitiser to its equipment collection drivers. “We have stopped requesting signature at point of collection, with all paperwork being sent by electronic means for signing and returning,” said Waygood. “And we have introduced procedures to maintain social distancing both on collections and also in the recycling dismantling processes.”
The outlook is positive for surplus catering equipment and asset disposal, according to Ramco’s business development manager, Paul Fieldhouse: “To date, demand for both surplus catering equipment and asset disposal has been similar to that typically expected during normal market conditions.
“Our most recent dedicated catering equipment auction performed particularly well, with a range of equipment including combi ovens, refrigeration units and inductions ranges successfully selling in a mid-lockdown auction. We are keen to see how the appetite and demand are to establish any trend – we are cautiously optimistic.”
Similarly, Ramco was also involved in two large decommissioning projects in April, one from the closure of a contract caterer’s Central Processing Unit (CPU), the other a London hospital kitchen transitioning to cook freeze catering techniques. Fieldhouse reported: “In both projects, technological advancements, industry developments and a need to consistently optimise kitchen performance have been the driving forces behind the demand for catering equipment asset disposal during the Covid-19 crisis.”
To allow its team to be able to effect equipment disposal during the crisis, Ramco has changed some of its systems and processes to ensure it consistently operates within government guidelines.
All equipment to be collected is thoroughly cleaned on arrival to its facility; required PPE is worn at all times during the decommissioning, removal and collection process; all equipment sold via auction is re-cleaned before being dispatched for delivery to the customer; no viewing or collection is available for auctions, though video footage of items can be provided; Ramco is running a no contact delivery service; and all goods won via auction are delivered via Pallet Network or Parcelforce.
Fieldhouse concluded: “Clearly the hospitality and foodservice sector has been devastated by the Covid-19 outbreak and, consequentially, there will inevitably be business failures over the coming months.
“Ramco predicts that there will be a sharp increase in the demand for asset disposal from the catering sector once a new normal is established and businesses try to mitigate potential losses.
“In addition, we believe that the outbreak will have a long-lasting effect on the structure and operations of the food industry. We expect that the foodservice sector will begin a period of transition as businesses move towards modern trends and technologies such as AI waiters, conveyor belt service and a focus on delivery over in-restaurant dining. With this in mind, we predict that businesses will have an increased asset disposal requirement as obsolete kit is replaced with more appropriate equipment.”