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FOOD SERVICE ASSOCIATES |
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Case studies
Central Government Department Food Service Associates were brought in by this Central Government Department to undertake a financial review of the catering contract to establish if the costs being declared represented the true costs incurred by the caterer in operating and managing the Department's staff catering. The contract was a corporate arrangement covering 5 sites in the UK. An extensive audit of all of the financial elements of the operation was undertaken. Site visits were made to each location to observe the standards being achieved for the costs declared. Menus, food quality, service standards and staffing ratios were benchmarked to other similar organisations. All unit accounts were examined and the cost lines were inspected in detail. Baseline labour costs and on costs were looked at in detail and measured against industry ratios. Additional running costs such as cleaning, training, uniforms and disposables were considered and commented upon. We also reported upon the number and level of central management and head office charges levied to the contract. A detailed investigation into the caterer's purchasing strategy and the individual unit prices paid for core items was conducted with individual purchase prices benchmarked against other units purchasing on a net into unit arrangement. Gross profit margins being achieved were reported upon and compared to similar venues. The overall financial picture and future budget projections were prepared and presented. Using the data from our report and consultant support at the meeting, the client was able to negotiate with the contractor and update the contract. The new contract ensures a visible and open accounting arrangement with a ceiling on some of the cost lines that were previously out of control. Future catering budgets have been reset and both parties now have a clearer understanding of each other's requirements in terms of operating standards and financial limits. |
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| Food Service Associates (Henley) Ltd, PO Box 48, Henley on Thames, Oxfordshire RG9 3YX |
