Kent county council has been forced to re-tender its school meals contract after a poor response from bidders.
The three-year deal, which is the UK's largest and has a turnover of about £9m a year, only received bids for 70 of its 405 schools.
The contract, which starts on 1 August and was previously run by Initial Catering, is now split into 22 clusters of schools.
Simon James, managing director of Initial Catering, said his company didn't re-bid because the contracts were not "sufficiently acceptable or financial viable".
Mark Sleep, client services manager at Kent County Council, said he would meet five caterers this week, including Initial and Compass division Scolarest, to find a way forward. "We'll look at it again and may need to tweak some of the specifications," he said.
Bracknell Forest council in Berkshire received no bids for its school meals service last month and food service consultant Vic Laws said it was now a worrying trend.
"Deals need to be viable but councils and caterers also need to work in much closer partnership," he said.
By Tom Bill