In spite of the fact that the
Argentinean economy was stagnant during the first half of this year, the demand
for catering services grew. As demand grew, so did the number of companies offering
services. At present the total value of Argentinean catering sales is estimated
at US$800m per year. Corporate catering is the largest sector, accounting for
sales of US$370m per year.

A combination of economic
recession and intense competition has depressed catering prices over the past
two years. The number of small to medium sized Argentinean companies entering
the field has increased significantly and several international companies also
joined the battle for market share. The resulting competition led to deep price
cuts, especially in the events category.

The Argentinean catering
market is broken down into two broad categories. The leading category by far
is catering for institutions such as hospitals, schools, and prisons. Total
sales for this category amount to over US$750m per annum. Growth in the value
of institutional sales over the past two years is attributed to the fact that
the number of institutions in Argentina is growing. Their catering requirements
are relatively constant, regardless of macroeconomic trends.

Income from events in
decline as recession hits consumer spend

The second category is that
of special events or festivities. Sales for this category have declined over
the past 24 months to a level of less than US$10m per annum. Income derived
from events catering tends to fluctuate in relation to consumer power. Argentinean
consumers were forced to cut back their spending for catering starting late
in 1998 when recession set in. Expenditures remained depressed through 1999,
although demand for event catering could edge up slightly late in the year as
economic activity bounces back. During the second half of this year, GNP expansion
is in the range of 3.2%. That may bring some life back into the events sector.


SOURCE: includes information
from the article “Una mano en muchos platos”, Mercado Digital (28
August 2000).

By Steve Lewis