The global commercial refrigeration equipment market size was valued at USD 33.53 billion in 2020. It is expected to expand at a compound annual growth rate (CAGR) of 4.2% from 2021 to 2028. The rapid expansion of the tourism and hospitality sector and the growing preference of end-customers to takeaway meals are expected to emerge as the primary growth factors for the market over the forecast period. Furthermore, factors such as regulatory pressures, shift to lower Global Warming Potential (GWP) refrigerants, technological breakthroughs, and the ability to cater to the ever-changing consumer behaviors are also anticipated to create promising growth opportunities for the market.
The refrigerators and freezers segment accounted for the highest revenue share of nearly 25.0% in 2020 and is anticipated to retain its dominance over the forecast period. The thriving travel and tourism sector globally, which has encouraged the establishment of several food service joints, including restaurants, has contributed to the strong growth of the segment in recent years. The segment also covers blast chillers utilized for promptly freezing or cooling items at lower temperatures and stopping the growth of bacteria in the stored item. The widespread adoption of chillers by healthcare professionals globally, to store tissue samples of controlled tests, vaccines, and critical medicines, is also a key factor contributing to the market growth.
The beverage refrigeration segment is poised to witness the fastest CAGR over the next seven years. The hospitality industry has flourished over the past few years, which has augmented the deployment of medium-capacity personal beverage coolers for travelers and vacationers. Furthermore, various retail channels are now encouraging the ‘sip and shop’ and ‘grab and go’ culture to offer a better shopping experience to their consumers. This trend is further expected to drive the demand for beverage refrigeration equipment over the forecast timeframe.
The self-contained segment accounted for over 85.0% of the commercial refrigeration equipment market in 2020. Easy and low-cost installation and low relocation and maintenance costs of the appliances are some of the key factors that contribute to the segment’s dominance in the market. According to the Environmental Protection Agency (EPA), in 2020, emissions from self-contained commercial refrigeration equipment accounted for nearly 26% of the total global HFC emissions. To abide by the stringent HFC emission norms, manufacturers are replacing R-404A refrigerant with R-448A refrigerant, reducing the GWP of the refrigeration equipment by up to 70%.
On the other hand, small refrigerators are being increasingly preferred by restaurants with limited kitchen space to minimize the heat produced by refrigeration appliances. Remotely operated refrigerators also outweigh self-contained refrigerators with minimal resonating noise, as the compressor unit is installed outside the restaurant kitchen. However, remotely operated refrigerators do not fare well when it comes to energy efficiency. Moreover, the installation of compressors requires professionals, which adds to the already high installation cost.
The 51 cu. Ft. to 100 cu. Ft. segment accounted for a revenue share of close to 50.0% of the overall market in 2020. The segment’s dominance can be attributed to the rising number of hypermarkets, specialty food stores, and supermarkets worldwide. Reach-in refrigerators are among the most rapidly deployed equipment in commercial spaces, with the most popular storage capacity being 50 cu. Ft to 75 cu. Ft. Manufacturers are offering several turn-key products that could fit well with the diverse requirements of customers.
The less than 50 cu. Ft. segment also accounted for a significant revenue share of the overall market in 2020. The constant need to successfully cater to the highly concentrated application areas from cold channel logistics to cash & carry stores and the foodservice industry has resulted in the development of different types of refrigeration equipment within this capacity range. Nonetheless, the selection of an appropriate refrigeration requirement majorly depends on the available space, the spending budget, and the number of sections needed to store food and other items.
The food and beverage distribution segment is likely to register the highest CAGR of over 5.0% from 2021 to 2028. Rapid developments in cold channel logistics and a rise in refrigerated transportation activities for shipping temperature-sensitive products to any part of the world have worked in the favor of the segment. Furthermore, the availability of cutting-edge temperature-controlled refrigerators for food trucks and other transport vehicles allows for the reliable distribution of fish, beverages, liquor, biopharmaceutical, and other perishable items to remote locations. The rising adoption of sectional refrigerated trailers by capital-intensive customers in the food & beverage distribution industry is likely to favor the growth of the segment over the forecast period.
The foodservice segment accounted for a revenue share of over 30.0% of the overall market in 2020. This can be attributed to the increasing penetration of Quick-Service Restaurants (QSRs) and food trucks in the global foodservice industry. As per the National Restaurant Association (NRA), U.S., there are over 1 million restaurant locations in 2020, including FSRs, QSRs, bars, and taverns, which have a substantial demand for refrigeration equipment. Moreover, the global franchisee expansion of prominent food and beverage brands, including McDonald's, Starbucks Coffee Company, and Subway IP LLC, favor the deployment of commercial refrigeration equipment in the foodservice sector.
North America dominated the global market in 2020 and is anticipated to account for nearly 30.0% of the overall revenue share by 2028. This can be chiefly attributed to the well-established retail industry in the U.S. The strong growth of the regional market can also be attributed to the presence of several leading commercial refrigeration equipment manufacturers. The early adoption of smart equipment in commercial kitchens in the region is also expected to work well for the market over the forecast period.
The Asia Pacific is likely to witness significant growth over the forecast period, chiefly owing to factors such as steady employment rates, improving economic conditions, rising gross disposable income, and increased expenditure on leisure activities such as traveling and dining out. Developing economies such as India and China provide potential growth opportunities for market growth owing to the rising deployment of vaccine storage units by biopharmaceutical companies and research institutions. Furthermore, the thriving travel and tourism industry in the region, especially in countries such as Malaysia, Singapore, and Indonesia, is expected to drive the growth of the regional market.
The rising deployment of sustainable technology equipment has compelled key players to focus on business strategies such as collaborations, mergers, and acquisitions that may strengthen their business presence. For instance, key manufacturers collaborate with solution providers to build customer-centric equipment addressing food wastage by grocery stores, hypermarkets, and supermarkets. In 2018, AB Electrolux collaborated with Karmalicious AB, a Sweden-based startup that designs and develops applications to minimize food wastage in restaurants and grocery stores. This collaboration was aimed at introducing a new technologically advanced refrigerator for grocery stores to minimize food wastage.
Furthermore, other key manufacturers are focusing on acquiring leading players or niche product manufacturers in an attempt to expand their geographical base and product lines. For instance, in 2019, Daikin Industries, Ltd. acquired AHT GROUP GmbH, one of the leading commercial refrigeration manufacturers in Germany. This acquisition helped the company to expand its business presence in the European region. Additionally, the launch of new products and strategies such as target marketing is being adopted to gain a competitive edge over other counterparts. Some of the prominent players operating in the global commercial refrigeration equipment market are:
DAIKIN Industries, Ltd.