Buffet Zone

Liz McAreavey started baking for a small delicatessen to supplement her grant during her student days at Edinburgh University. Several years later, McAreavey had bought the very delicatessen that had kept her in beer money.

A decade later, she owns Le Bistro Caterers, a fast-growing catering company, probably Scotland's leading independent, with turnover approaching £3m.

McAreavey had never planned to own a business, and had certainly never considered catering. She studied accountancy after her degree and a steady, if unspectacular, professional path seemed set.

Her progress began in 1987 when she returned to live in Edinburgh and discovered one of the delicatessens she had supplied years earlier was up for sale. On impulse, she bought it.

learning curve

"I knew nothing about catering. The first years were a dramatic learning curve and very small amounts of money were earned," says McAreavey, who started selling sandwiches from the shop she called Le Bistro. She calls those difficult early years the costs of her education.

The late 1980s boom was good for Le Bistro, with large numbers of office workers on the company's doorstep demanding sandwiches. But the boom was relatively short-lived and increasing competition made it harder to make a profit. "At one point there were 26 shops selling sandwiches within a two-mile radius," McAreavey recalls. As the once-packed office blocks became vacant, it was clear that McAreavey would need to diversify.

The solution came as a result of the recession. Lunch was no longer fashionable, but companies still needed to feed clients and customers at a reasonable cost. So Le Bistro Caterers began supplying working lunches - buffets, platters of sandwiches and so on. It changed the direction of the business for good.

As McAreavey won more contracts, including prestigious ones such as the Law Society of Scotland, it became clear that the company would have to move from its original shop to bigger premises. In 1994 the move was made when McAreavey bought a smaller business - Smile Parties - that had a number of prestigious contracts for boardroom lunches.

"At this point," McAreavey recalls, "I was really bitten by the ambition bug. I wanted to go for bigger numbers."

Meanwhile, McAreavey's main competitor, the oldest catering company in Edinburgh, was causing her some anxiety. "Customer loyalty is not to be underestimated," she warns.

But McAreavey was not easily put off. Her way around this particular problem was to head-hunt the catering manager of the competitor. "Bringing him on board opened doors," she says.

That year, 1995, turnover doubled. Having outgrown another site, McAreavey bought a city-centre location to refurbish as the group's headquarters. The original delicatessen was sold to fund the acquisition.

McAreavey's major competitor was Crawfords, a bakery chain with a successful outside catering arm. Despite Le Bistro Caterers' growth, it became clear that sinking the competition was pretty much impossible. That left one other option: to buy it.

At this point McAreavey started talking to corporate financiers and venture capitalists. "We were very gung-ho," she says. However, that route eventually came to nothing.

Then luck intervened. Crawfords went into receivership. McAreavey immediately contacted all Crawfords' clients to offer Le Bistro Caterers' services. Turnover went from £500,000 to £1.5m, practically overnight.

"It was a huge challenge. Suddenly we were recruiting like mad, trying to put a strong infrastructure in place," she says.

The company's rapid growth was not as smooth as it sounds in retrospect, McAreavey admits. "We were close to the edge during the growth period. Like many under-capitalised companies trying to grow, it might easily have collapsed," she says. But that is the challenge of developing your business. "It was character-building," she recalls.

A year on from the coup of Crawfords, turnover is fast approaching £3m and the company is set for much bigger and faster growth in the next two years. "We have targeted a number of contracts coming up. If we get all those, our turnover will be £7m by 2000," says McAreavey.

In a new departure for the company, Le Bistro is to operate a destination restaurant at the Quality Inn, Edinburgh Airport, and McAreavey expects to see a lot more growth in that direction. Other high-profile contracts at Le Bistro are the £750,000 contract at Musselburgh Racecourse and the management contract at Hibernian FC, worth between £750,000 and £1m.

Le Bistro Caterers also operates at the Royal Highland Showground, where it can cater for up to 1,400 people at once.

With a staff of 30, McAreavey is determined to continue looking for opportunities to develop the business. "A little success is a huge motivator," she says. But there are plenty of contracts to be won in the east of Scotland before Le Bistro turns its attention elsewhere.

Furthermore, McAreavey wants to change the culture of catering in Scotland. "We're committed to challenging people's expectations," she says. "There are a lot of opportunities in the catering industry if we can raise the standards and recruit high-calibre people."