Airline Catering Services
Business for Sale Industry Economics
2002 - 2020
2020 - 2026
This company sells transportation equipment and materials wholesale, such as aircraft and aircraft parts and components, vessels and marine equipment, and freight cars and train equipment.
It does not sell marine pleasure boat engines and components, motor vehicle transportation supplies, or electronic navigation equipment (e.g. sonar or radar). Nonetheless, the industry’s sales growth is being offset by falling corporate profit levels.
As a result, sector revenue is expected to rise at an annualized rate of 3.9 percent to $5.7 billion over the next five years, with a 1.9 percent boost in 2020. Profit margins have already increased in the five years leading up to 2020.
For the five years to 2020, the skies have been open for the Airline Catering Services market, as households have benefited from strong economic growth, growing demand for air travel and, as a result, the industry’s sales.
Airline caterers depend on demand from airlines’ purchases of food and drinks, which are either sold for a premium or included in ticket prices for travelers. With disposable incomes increasing during the last five years, together with a low unemployment rate, air travel has increased significantly, driving up demand for food and drinks on board.
Conversely, since company air travel is dependent on stable corporate income flows, the five-year downturn in corporate earnings has prevented businesses from incurring corporate travel expenses, lowering industry revenue.
As a result, industry income is expected to grow at an annualized rate of 3.9 percent over the next five years to 2020. Revenue is forecast to grow 1.9 percent to $5.7 billion in 2020 as income levels rise, making it easier for customers to fly by air.
Good patterns that favor the Airline Catering Services industry will prevail for the next five years, until 2025. Progress will also be helped by the economy’s continuing expansion, which is projected to boost air traffic.
Domestic trips by US residents and international trips by US residents are expected to rise at annualized rates of 1.7 percent and 2.5 percent, respectively, over the next five years to 2025. Airport catering facilities will most likely see an increase in demand as air traffic grows.
While continuing cost-cutting efforts by airlines will restrict revenue growth, growing demand for luxury meals for corporate and first-class passengers will create opportunities for catering firms. For the next five years, market income is expected to grow at an annualized rate of 2.2 percent to $6.3 billion.
This industry prepares and caters food for domestic airlines, overseas flights (originating in the United States), and nonscheduled domestic flights (e.g. charter flights). Airline caterers earn money by providing full meals, beverages, snacks, and other items such as cutlery, napkins, and cups.