Sainsbury’s breaks up £40m staff catering set-up into four regions

Supermarket chain Sainsbury’s has shaken-up its £40m-plus staff catering operation by grouping it into four regions, Caterersearch can reveal.

The UK’s second largest supermarket group has unified catering at its 450 staff restaurants – previously handled by Compass Group - and its 20 distribution centres – formerly contracted to Sodexo and 7 Day Catering - into four regional contracts.

Under the new deal, Compass’s Eurest will run London and the South-east region, while BaxterStorey has come in to run the North, Scotland and Northern Ireland.

7-Day Catering, which previously ran three distribution sites, is the big winner, picking up the remaining two regions, including East.

Sodexo, which previously provided staff feeding at 17 distribution sites, has lost out completely, while Compass is believed to have lost out on 75% of its original share of Sainsbury’s business despite picking up one region, according to sources close to the deal.

The terms of the new deal have not been disclosed but, under the previous arrangement, Eurest received a fixed price of £16.5m a year to run the staff restaurants, with another £16.5m going through the tills annually, meaning £33m in total turnover.

Estimates put annual turnover from staff restaurants at Sainsbury’s 20 distribution sites at around £8m, bringing the estimated total value of the deal to £40m-plus, which is thought to be divided evenly between the four regions.

Facilities management and catering at Sainsbury’s three national offices, including its headquarters in London’s Holborn, will continue to be provided by building company Interserve, while Sainsbury’s continues to run its in-store public restaurants directly.

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By Chris Druce

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