The revolution of working lunches

Employers are turning to contract caterers in droves to cut the costs of providing meals for their work forces, according to a survey of workplace catering.

The survey of 980 workplace dining rooms serving a total 221,000 people a day, carried out by Touche Ross and the Industrial Society, revealed that almost 20% of employers had switched from in-house catering to outside contractors in the past three years.

Not surprisingly, the main reason for changing to contract caterers has been the desire to reduce the level of subsidy on meals, which still stands on average at £328.90 a year. More surprising, though, is the fact that despite the reduction in subsidy, overall uptake of meals is increasing in a majority of outlets.

This can be explained, at least in part, by the innovations taking place in workplace catering. In terms of food provision, 80% of caterers have provided more healthy/vegetarian options on menus during the past year. Most have also increased menu choice and the availability of snacks.

In terms of improving efficiency, the biggest innovations have been the move towards a cashless system, the introduction of microwaves for cooking, provision of take-away facilities, increased use of self-help counters and more facilities where customers clear away their own meals.

As a result there has been a huge improvement in labour productivity in many units. While the bottom 25% of units manage to serve only 14.6 meals per full-time equivalent member of staff per day, the top 25% serve 26.9. And contract caterers provide 21% more meals per member of staff than in-house operations.

Added to the better productivity is the apparent ability of contract caterers to pay less. While in-house operations pay catering assistants £4.11 an hour on average, the equivalent figure for contract caterers is just £3.20.

As a result, typical payroll costs for contract catering operations are around £1.73 per meal, compared with £2.07 when the catering is in house.

It is clear from these survey results that the trend towards the contracting out of workplace catering will continue as long as employers seek to reduce subsidies and contractors have the edge on efficiency. But it is equally clear that with such wide disparity in performance, only those who continue to innovate will survive, whoever does the catering.