Catering contracts go under the microscope

20 March 2006
Catering contracts go under the microscope

Consultants and benchmarking companies are increasingly being asked to scrutinise the financial details of contracts because of the bad publicity surrounding Compass Group, industry figures have warned.

Consultants believe Compass's involvement in a UN corruption investigation and purchasing irregularities has made clients more aware of the fine print in contracts.

Food service consultant Jonathan Doughty said: "The Compass thing has had a huge impact on the client-contractor relationship. The big boss of a company will read about it in the Financial Times, get nervous and start questioning his facilities manager. I've been to five meetings in the last two weeks about this - not all related to Compass."

Consultant Chris Stern has noticed a similar trend. "We're doing about 25% more auditing work than we were 12 months ago. There's a suspicion in the market about purchasing transparency and clients basically want to know if they're being ripped off."

Stern added that clients were more wary of larger operators. "With smaller caterers, it's easier for bosses to be more hands-on and build better working relationships with clients."

A Compass spokeswoman said: "We witnessed a degree of tighter financial scrutiny of contracts in the aftermath of the UN investigation. However, we're now experiencing normal levels of activity." She added that it had not lost a contract as a result of an audit.

By Tom Bill

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