Total FM
| A fresh look at catering |
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| Written by Paul Rogers, Managing Director, KitchenFM, July 2005 | |
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When management of catering facilities falls within the remit of the facilities or estates management department, it requires a significant investment of time and resources. Savings on both can be made by outsourcing procurement and management of catering equipment to a specialist provider.
Running a catering operation, whether it's an in-house facility for staff or an integral part of your company's business, can draw heavily on the FM department's time and resources. As well as equipping and maintaining the kitchen, there are also issues of administration, staff training and compliance with legislation to contend with. At the same time, the way that in-house catering facilities such as staff canteens are run have a major effect on staff morale and the relationship between the FM department and its internal customers. And when the catering is part of the business it's vital to get it right for the paying customers. All of which means the catering facilities have to be run efficiently while taking cost-control measures that do not compromise on quality. In terms of putting a figure on the cost of catering, this isn't as simple as it first appears, especially when traditional procurement methods are employed. Direct costs such as buying equipment and paying for maintenance contracts are obvious, but there are a number of indirect costs that generally get swallowed up in other budgets and often go unnoticed. An alternative is to consider outsourced solutions that take care of everything from the initial design of the kitchen and supply of equipment to the day-to-day management of that equipment, including training the staff how to use it. Although well-established in other areas of procurement, this approach is still in its infancy in catering but has the potential to save both time and money. At the heart of the outsourcing approach is the ability to package all procurement and management issues together, for a fixed monthly fee. It avoids the need for capital outlay in fitting out a new kitchen, or for upgrading existing equipment, and the monthly fee can be met from revenue budgets. As such, one of the benefits of outsourcing is that equipment can be procured as and when it is needed, rather than having to wait for funds to become available. In terms of direct costs, the financial comparison will depend on economic conditions, interest rates etc. but will not cost more than traditional procurement methods. In fact, in most cases, it will reduce direct costs over the term of the contract - but that's only part of the picture. Above and beyond the direct cost issues is the impact on the indirect costs mentioned above. Many of these are viewed as 'just part of the job' but when they are considered in more depth it's clear they combine to take up a lot of time and resources. Procurement and maintenance issuesThe purchase price of equipment and the cost of maintenance contracts are the obvious costs associated with catering equipment but there are additional costs in terms of downtime, administration time, loss of productivity and the risk of providing a reduced service to customers (internal or external). In a typical catering operation, dealing with these issues alone can account for 50 hours of management time per annum.Whenever there's a breakdown you need to contact your maintenance company and find a way of working around the problem until someone arrives to fix the broken item. In the worst case scenario, you will need a new piece of kit and will have to go through a tedious and time-consuming procurement process. Furthermore, the new item may take several days, or weeks, to arrive. Or the funds may not be immediately available, so you just have to manage without until they are. During this time you have to work around the problem, reassign staff to other tasks, possibly changing the menu and printing new ones to accommodate the equipment that can be used. When management of the equipment is outsourced, all of these problems are taken care of, without mountains of paperwork and with no need to involve the procurement or accounts department. A single call to the outsourcing partner prompts a visit by an engineer if the problem can't be resolved on the phone. And that partner should hold commonly used spares on site, with quick access to other items so that equipment is up and running in the minimum time. Similarly, if you want to refresh your menus and need different equipment to do it, the outsourcing contract should provide the facility to upgrade individual items within the scope of the contract at no extra charge. Training of staffEvery new member of staff requires some induction training, which will include the initial tranche of health and safety training, as well as specifics relating to the kitchen they will be working in. Even experienced catering staff need to be familiarised with the particular types of equipment in that kitchen to ensure they use it correctly and don't cause damage leading to downtime and maintenance call-outs.Applying some average figures to an imaginary kitchen with 20 staff, we can start to form a picture of the costs of training. We can assume that each new member of staff requires two days (16 hours) of induction training, and that with the catering industry's average staff turnover of 40 per cent, eight new staff will be employed each year. If management costs work out at £20 per hour, then 16 hours of induction training for each new member of staff comes to £320 per annum - or £2,560 for all eight new staff. In addition, all staff need to be kept up-to-date with new environmental and health and safety legislation, new additions to the menu and any new equipment that has been installed. As a minimum it is reasonable to assume a further one day's training per year for each of the 20 staff - again at a management cost of £20 per hour, adding a further £3,200 to the training bill (eight hours per employee at £20, for 20 staff). Of course, these costs could be even higher if it is necessary to employ translators to ensure non-English speaking staff are equipped with the necessary level of training. In using interactive, multi-lingual training systems, tailored to your kitchen and the equipment it uses, much of this basic training can be provided without direct management input. So, where an outsourced contract includes this training facility, there is more time available for one-to-one specialist training, or to devote to other management issues. Such training might include use of equipment and troubleshooting any problems that occur, leading to fewer unnecessary maintenance call-outs. It can also take in basic hygiene and food preparation, as well as health and safety procedures. Improved health and safety training will also reduce the incidence of reportable accidents, especially those accidents caused by insufficient training such as contact with hot substances and injuries caused by lifting. As well as improving rates of absenteeism, better safety training will reduce the amount of health and safety paperwork generated by reportable incidents. Retaining staffResearch by the Chartered Institute of Personnel and Development has identified lack of training as one of the principal causes of high staff turnover. At an average recruitment cost of £1,100 per head, taking time and administration into account, high staff turnover is an expensive burden. In improving training, and providing it in the preferred language of each member of staff, it is reasonable to expect a boost to staff morale that will reduce turnover, saving money and management time.Keeping pace with legislationThe rapid pace of change in environmental and health and safety legislation means that you have to keep up to speed with the latest requirements and ensure that your kitchen complies.With an outsourced solution, regular inspection by qualified technicians ensures that all of the equipment complies with the latest standards, with non-compliant equipment being replaced at no extra charge. And, of course, videos on how to use and troubleshoot the new equipment can be added to the training courses. Making sense of itA fundamental concept of outsourcing to specialists is to farm out the day-to-day distractions and free more time for focusing on the strategic management of the core business. Managing kitchen equipment is secondary to the principal purpose of feeding people, so it makes perfect sense to take a fresh look at the real cost of catering procurement. Further information |
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