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The Business Of: Food Services

For some districts, outsourcing may be the answer
  • Students in a Sodexo-run “Kids Way Cafe” cafeteria chose from a variety of fresh fruits and vegetables. All furniture and food are designed with bright primary colors, which can entice young children to eat up.
  • Students at Colonial School District in Delaware, left, learn the origin of some of their food by tending to the district’s garden, which supplies fruits and vegetables for the district’s school cafeterias.
  • The design of ARAMARK’s 12 Spot cafeteria for middle school students incorporates what many children this age value: sports and having fun with friends. Market research determines what food is offered, based on trends of what students like to eat.
  • ARAMARK’s u.b.u cafeteria for high school students is styled like a lounge, with comfortable seating for students to not only eat, but also come together to socialize or collaborate on school work.
  • A student at Minneapolis Public Schools selects a meal from among several healthy options, including a salad and a banana.
  • All furniture and food in Sodexo-run “Kids Way Cafe's are designed with bright primary colors, which can entice young children to eat up.

Students can be picky customers. And when they expect their cafeterias to serve a wide variety of attractive, fresh food, there is great pressure on food services staff to deliver. For some districts, the best way to please students and thereby increase participation is to maintain total control and keep all food service operations in-house.

“We run our restaurants as true businesses,” says Chad Wilsky, director of food service at Seminole County Schools in Florida. “Our top priority is providing food that our students want to eat.”

As Seminole County is an affluent community, with one of the lowest free and reduced rates in the state, Wilsky knows most of his students can bring whatever food they want from home. Yet, because he puts his customers’ desires first, breakfast and lunch participation is high. The food services department takes in $30 million annually in revenue from 65 schools. The average revenue for Florida food service departments for the 2012-13 school year was $17.8 million.

“As we run everything ourselves, we control the products we offer our students,” Wilsky says.

Students each day are offered six to eight types of fruits and vegetables, most of which are fresh. And even though the district buys trays and utensils on its own, costs are kept low. Seminole County buys Pactiv brand trays and Daxwell brand utensils from the distributor Peninsular.

“Our pricing for supplies is just as low as when we were part of a consortium because we have a good relationship with our vendors,” Wilsky says. “Pricing is based on usage, and we are able to provide very accurate usage forecasting. We say, ahead of time, what we are going to use, and that is what we use.”

But some districts find outsourcing necessary to save money. An outside company can offer strategies to help a district cut costs and increase participation, Wilsky says. Districts should also consider outsourcing if their food service departments are not sustaining themselves financially, Wilsky says.

Providing Healthy Food Students Want

At Seminole County Public Schools in Florida, providing food made of high-quality ingredients is top priority, says food service director Chad Wilsky. Pizza, which is normally considered junk food, can be made healthier because Wilsky can control the ingredients.

“We make our whole grain crust on-site,” says Wilksy. “We use a pre-made pizza sauce that was carefully selected because it has only five ingredients.”

The main ingredients in the sauce are tomato puree from vine-ripened fresh tomatoes, spices, and extra virgin olive oil.

Yogurt is another product that can be made attractive to students, says Michael Neuwirth, senior director of public relations for The Dannon Company. Three of the USDA’s nutrients of concern are calcium, Vitamin D and potassium, all of which are in Dannon yogurt, he says. Another healthy yogurt provider is General Mills; its Yoplait product also carries brand recognition with students.

Ideally, revenue from food sold should cover all costs. “The bottom line is districts should not and cannot use general fund dollars on food service,” he adds.

Success in-house

Colonial School District in New Castle, Del., has an 80 percent lunch participation rate in its self-operated food service department. Of the 10,000 students in the district, 8,000 buy lunch each day. Like Seminole County, this can be credited partially to the priority placed on students’ wishes, says Paula Angelucci, the district’s supervisor of nutrition services.

“I am out in the school talking to the students and getting to know their palettes,” she says.

The district added bakers to make homemade pizza shells, bread sticks and cookies to be sold a la carte when it became clear how much students liked fresh baked goods. Typically, the food service department sees $150,000-$175,000 from a la carte sales.

These popular items help the district make up costs when students don’t pay, which amounts to about $6,000 a year, says Angelucci. “I know that if I do not meet my budget, that can leave me vulnerable to the district deciding to bring in a management company,” she adds.

It’s important to balance low costs with offering students the food they want, Angelucci says. “I realized they didn’t want to eat a whole apple, but they would eat them cut up,” she says. “Well, I found the pre-cut ones were low quality and too expensive, so we bought wedgers to cut whole apples in-house.”

Her department’s focus on the farm-to-table movement was recognized last year when she competed alongside celebrity chef Jose Garces against celebrity chef Anne Burrell and a food service director from Houston ISD, the seventh largest district in the country. Both chefs frequently appear on the Food Network.

Administrators’ Guide: Should I outsource?

Here are key questions to ask when deciding whether to outsource food services, according to Ted Monk, senior VP, Sodexo Education-Schools:

  1. Do I have a qualified general manager to lead my nutrition program?
  2. Is the quality level of my food low or perceived as low by students and the community?
  3. Is participation in all food programs low?
  4. Is my food services department self-supporting or is it being subsidized by the general fund?

The competition was Cooking Light magazine’s “The Great American School Lunch Challenge” and was intended to show districts how to make healthy, appealing school lunches on a small budget. It took place at the Building a Healthier Future Summit in Washington, D.C., a year ago.

Garces, Angelucci and a cafeteria manager from one of her schools were asked to create a lunch in 30 minutes that students would want to eat, she says. “We had to stay within the USDA guidelines and a strict budget.” Angelucci’s team made a Mexican dish with chicken and black beans, pan-roasted sweet potatoes, and a graham-topped pear cup, and won the competition.

Out of the box

Out-of-the-box thinking is necessary to run a successful food service department. Breakfast participation was low in the Colonial district until Angelucci launched a grab-and-go cart program in the elementary schools. Students now eat breakfast in their classroom instead of rushing off the bus, eating quickly in the cafeteria, and sometimes getting to class late. Breakfast participation rose by 30 percent.

“An important part of the recipe to a successful food service department is having someone in the director’s seat who has passion,” says Angelucci. “At the same time, they need to have the financial sense to make the tough decisions—like cutting staff when that is the only answer to saving money.”

Angelucci has not had to cut staff, but she has had to reassign people to different schools when enrollment changed. And a key fact to remember is that food service management companies are out to make a profit, says Bertrand Weber, food service director at Minneapolis Public Schools. “When you run your own department, you are putting your revenue back into your program, such as by purchasing equipment.”

When outsourcing is more feasible

But not all districts have the leadership to run a successful food services department. “It takes a lot of manpower to develop and run a food service program,” says Karen Dittrich, director of marketing and communications at Chartwells School Dining Services, a food service management company.

Some of the duties required of food service managers include menu planning, ordering food and supplies, and communication with the students, parents and board members. “Many school districts just don’t have the time that is needed,” says Dittrich.

Management companies can take the burden of staying updated on USDA standards off administrators’ shoulders. And as regulations, such as the Nutrition Standards in the National School Lunch and School Breakfast Programs, required complete compliance within a year to receive USDA funds, staying on top of these guidelines is essential. The companies often have staff members whose sole job is to monitor the guidelines, which dictate information such as the sodium amounts allowed in food, says Dittrich.

Because outsourcing can be seen as taking jobs away from community members, some management companies allow districts to keep some positions, such as line cooks, in-house. “Depending on the school district’s preferences, employees are either district employees or Chartwells employees,” says Dittrich. “Our recruiters work together with the on-site operations team to find the most qualified candidates for any positions that need to be filled.”

Management companies can also ease the bidding process by providing all the dining supplies a school needs, says Clare Keating, vice president of marketing at Preferred Meals, a school food provider. And those companies can conduct more rigorous food safety checks, she says. “Starting in our food production plant, we have USDA inspections daily,” she says.

“Then we take it a step further and are audited annually by an independent company to ensure food is being prepared safely.”

Management companies like Preferred Meals also maintain websites that display menus and allergy and nutrition information in a way that is readily available to students and parents, says Jim Drumm, national vice president of business development at Preferred Meals.

Marketing to the customer

Marketing to students’ evolving tastes is another area in which management companies bring expertise, says Barbara Flanagan, regional vice president for ARAMARK Education. And quality outsourced companies will research trends in student eating, says John Kandemir, vice president of marketing. “We do an analysis on the school level to figure out who is participating and who is not, and why, and based on that we can offer products that will draw in non-participators.”

For example, students stated through an online survey that they would be more likely to eat breakfast if it was available in alternate locations outside the cafeteria, says Kandemir. ARAMARK then encourages districts to implement Breakfast in the Classroom programs, with portable AMP Up breakfast carts to get those students to participate.

Even the atmosphere can play a role in whether a student chooses to participate in a lunch program. “Our dining facilities look like where students like to eat outside of school, not school cafeterias,” says Kerri Dixon, ARAMARK’s director of business development and industry relations.

Cafeterias managed by ARAMARK mimic restaurants by offering taste tests and serving limited-time products. For example, one limited-time offering is a Cajun-themed menu that is available in February or March to celebrate Mardi Gras, or Fat Tuesday.

Crossroads Cafe, Sodexo’s cafeteria for high schools, features ethnic foods and made-to-order deli and pizza stations, which are popular in high school. It’s styled like a food court in a mall, with color combinations that use school colors.

Students’ tastes and desires change over the years. That’s why the decor, setup and menu varies by age level in the cafeterias designed by Sodexo, says Ted Monk, senior VP of Sodexo Education-Schools. “Crossroads Cafe offers sophisticated flavors and types of food,” he says, “to make students want to eat there everyday.”

Kylie Lacey is special projects editor.