Catering as we all know is an emotive issue. Food & drink is a staple of life, without it we just wouldn’t exist. It is a bond that ties us as the whole human race together regardless of religion, culture, gender or politics. It evokes significant debate on its value to society, on how it should be delivered and consumed and whether it should be provided as a right or be determined by customer choice.
According to research the food industry represents 10% of GDP in the US and is worth $1tr and dominated by big producers such as Nestlé, Kraft and Unilever. According to DEFRA its about 8% in the UK and 13% of all employment.
When I first started out I worked in large industrial kitchens feeding vast numbers of workers at pre-determined times using fresh ingredients mostly prepared on site. Back in the day the workplace was very hierarchical with separated dining depending on your grade and no one became a Manager until they were at least 40. Workers were docked money from their pay for a three-course meal. You were served good old canteen fare like Steak & Kidney Pie, Fish & Chips or Cauliflower Cheese.
Particularly in the eighties we saw the rise of outsourcing as the cost of sustaining in-house ‘food-for-all’ operations became more unsustainable in the light of increasing wage inflation and more competitive markets. Also habits started shifting from big meal to lighter lunches. Contract caterers like Gardner Merchant, Bateman & Sutcliffe emerged along with the invention of the ‘customer’.
In order to keep rigid control of the offer companies not wishing to completely lose their control on catering prepared complex input specifications for contractors to bid against. Large elements were fixed and non-negotiable, such as the sacrosanct tariff. However, as the companies didn’t know how much they spent on catering before these caterers did well as they could play the volume discount and staff productivity card. Most of this was cost plus so very much relied on trust. Along came Catering Consultants feverishly proving that clients were being ‘ripped off’ by unscrupulous caterers inflating ingredient costs.
Fast forward to 2015 and the world is changing at an even faster pace but in some cases the industry is struggling to keep up. In a recent review of civil service catering in Whitehall we discovered that 80% of the budget is spent on providing hot meals to less than 20% of staff. Margins were generally less than 30% with labour at over 60% of sales. Vast areas of space (worth around £50 per sq ft in commercial rental alone) are given over to energy consuming kitchens and dining areas all requiring heating, ventilation, air-con, lighting, security, maintenance and so on.
We also found that 70% of staff wanted kitchenettes to prepare their own food particularly seeing the canteen as poor value for money – unless it sold branded coffee. Of course the trouble with branded coffee outlets, although great revenue generators, is that they sell lots of pre-packaged higher calorie products with arguably poorer nutrition.
Interestingly customers believe that their employer should subsidise hot meals but these employers see it is a sunk cost. As seen in the education sector poor nutrition has a detrimental effect on concentration and productivity especially when the offer is predominantly caffeine and carbohydrate which can potentially lead to obesity, diabetes let alone consequent increased stress, more sick days, poor staff retention and so forth.
Employers need to seriously consider how much it values and engages with its staff and Catering can be the catalyst for this. The High Street, in particular, leads the way in simplifying the offer and because their life depends on every sale quality and customer service is crucial.
One way is to release workspace to caterers to trade on a concession basis. The client guarantees the footfall and the operator’s job is maximise uptake at their risk. It eliminates armies of expensive client contract units, significantly reduces space utilisation (through smaller footprints, technology and better staff productivity) and removes energy risk as it is passed to the provider. If the client wants to offset selling prices then this can be done on a sale-by-sale basis because there is plenty of auditable transaction data available.
We don’t always think through the implications of change. In 1978 the silicon chip revolutionised our domestic & work lives in a way that was unimaginable including they way we eat. The old ways persist and are a barrier to progress, but will it last? I think not.