Initial strikes back in schools sector

Initial Catering has secured deals worth £14.5m in annual turnover with five school catering contracts.

Two of the contracts will be taken over from in-house teams in what chief executive Jim Walker sees as a reversal of last year's decline in the number of state education contracts going to the private sector.

Initial is to take on four-year contracts covering 245 schools in Leicestershire, worth an annual £6m in turnover and a £3.1m contract for 153 schools across Essex.

The contract caterer has also regained contracts after winning tenders for schools in Cornwall, Wokingham and Reading.

Walker said that a 12% drop in the number of contracts held in state schools last year was a result of fewer contracts being put out to tender while local authorities got to grips with a new policy of Best Value rather than Compulsory Competitive Tendering, based only on price.

"I think there will be a dramatic difference next year now that contracts are getting out to tender again," he said.

But he added that many contractors continued to shy away from state school contracts even though the margins that could be achieved were similar to those in business and industry contracts.

"If you market it well, it's just like any other business. You just have to increase the throughput and get more children in," he said.

Source: Caterer & Hotelkeeper magazine, 17-23 February 2000