Despite facing the challenges of recession in both the UK and many other markets around the world, coupled with a growing consumer interest in food and nutrition issues, the contract catering industry remains basically upbeat and optimistic. 2009 saw slight but nevertheless positive growth, contributing to a degree of confidence in the future. That’s the conclusion of the latest research from the British Hospitality Association – read the report below.
For a snapshot of the sector, what FMs look for in a service provider and the contract terms of typical deals, see our latest 30-second survey.
For an insight into the changing marketplace and the numerous factors that are shaping service offerings – much more than just price! – read our feature article from Andrew Barry, MD for foodservices at Eurest.
For a view on how to choose a service provider and the benefits of getting it right, read the comment from Gordon Haggarty, MD at Accent Catering.
A Welcome Degree of Confidence
Turnover in the food and service management sector increased marginally in 2009 to £4.2bn, the annual survey of the British Hospitality Association’s Food and Service Management Forum reveals.
Announcing the results of the BHA’s 21st survey, Phil Hooper, Chairman of the Forum, said the past 12 months had been tough for companies in the sector but, despite the recession, turnover had moved ahead by 0.7 per cent.
“Clearly, food and service management companies are doing something right,” he said. He added that contractors had reacted to the economic downturn by cutting costs, particularly employment which had declined by six per cent and which, at 47 per cent of turnover, was by far their biggest single item of expenditure. At the same time they continued to withdraw from contracts that had been only marginally profitable.
“Companies have also expanded into providing full facilities management services both for existing and for new clients,” he added.
Hooper said that the most vulnerable sector was Business & Industry which had been affected by factory and office closures and by redundancies in client companies; in contrast, public sector catering had been largely unaffected and healthcare, in particular, did well. Catering in public and leisure sectors was also up; and the recession was encouraging more companies to consider outsourcing in-house catering facilities in favour of contracted catering.
“The fact is, turnover actually increased for the vast majority of companies. The survey showed a welcome degree of confidence in the future,” he said. “There is certainly no despair.”
“What remains is a sector that has survived the worst recession in a generation leaner and potentially more profitable than before.”
Bob Cotton, Chief Executive of the BHA, said that the results had to be seen against a background in which GDP had fallen by five per cent, unemployment had risen by over half a million and food inflation had soared. FSM companies had survived in remarkably good shape, he concluded.