It finds that following 2009’s economic downturn and a fall in unemployment, signs of recovery are evident as numbers of schoolchildren increase as well as the rise in elderly requiring support, which has created demand for more catering solutions.
Also, the largest companies in the market are Compass and Sodexo, who have begun finding non-catering business solutions to expand its services. Sodexo derives an increasing proportion of its UK revenue from a range of 140 other services. While, as it recently stated, its food service volumes continue to decline as a result of employee downsizing and cost-saving measures taken by its clients. Compass reports that over a quarter of its UK revenue (around 10% of its global revenue) derives from non-catering activities.
The two leaders have lost significant market share in recent years to a series of smaller rivals. These include specialists, such as Baxter Storey – which has continued to achieve year-on-year growth driven by a series of new contract wins – and facilities management groups. These include MITIE – which has had a series of successes in selling contract catering as part of its bundled service offer and has, as result, been able to double its revenue in the last two years – and Servest and Interserve, which both stepped-up their presence in contract catering following their recent acquisitions of Initial and 7-Day Catering respectively.
The Apex report also finds that success in the industy requires effective management of two key inputs, labour and food. It finds that employers with large numbers of employees on relatively low pay are a key challenge for caterers as recruitment and training demands increase in order to maintain a quality service.