Business Strategies: Reposition the Benefits you Give the Customer

One development getting a lot of coverage in business news today has a definite impact on the refreshment services industry: U.S. companies are reducing the benefits they are offering to their employees. The focus is company pension plans. The federal government has rolled out new laws requiring companies to shore up the solvency of their plans. In other words, infuse cash into the pension plans.

The federal government wants to make sure the financial commitments that companies have made to their employees will be met. Although that sounds great to those who have pensions, there is a downside. Many companies don't want to use their cash to fortify their plans, but plan to use it in other areas of their business. IBM is a great example of this. Starting in 2008, IBM's pension benefits will be locked in place at the employee's current salary and length of service. New employees will not be able to participate in the pension plan at all.

By now you're probably asking yourself, what does this have to do with my vending, OCS or food operations? I would suggest that you can help ease the pain of your customer's difficult transition in having to lower their benefit offerings. This can be accomplished by sharing with your customers the benefit your products and services provide to their employees.

The beauty of your benefits is that it is a fraction of the cost of traditional benefits. I know some readers are saying, "this guy can't be suggesting that the candy bar and bottle of soda I sell to my customer will be a substitute for a pension plan." No, I'm not. But the reality of the future for virtually every American worker is that he/she will be providing for more of their future financial security than generations in the past.

The vending industry can help make the work environment more bearable as difficult decisions are being made on what to do with company cash and profits.

The following examples are ways to present cost-effective products and services to your customers. Consider them work environment enhancers.

CAFETERIA SUBSIDIZATION

Let's initially look at the per employee cost of subsidizing a 1,000-person company that offers an inhouse cafeteria, or in vending vernacular, manual food. First, we need to make a few assumptions. Assume the cafeteria is open for breakfast and lunch every business day.

There are 20 business days a month and the utilization of the facility is good; 35 percent of the workforce uses the cafeteria for at least one meal per day. What is the per employee cost of operating the cafeteria?

The information in the graph demonstrates that the cost for a company to offer a subsidized food service is low. The key drivers in the chart are the amount of employees utilizing the facility and the cost effectiveness of the operations as reflected in the subsidy.

The best way to ensure that the drivers are moving in the right direction is to provide the customer with the kinds of quality foods and services they are looking for.

Looking at the cafeteria from a different perspective are areas that are beneficial but harder to quantify. They are things like improved morale, greater employee retention and increased productivity.

OTHER BENEFITS TO THE EMPLOYER

I spent several years of my career in corporate dining facilities. During our service periods, I was out in the "front-of-house" working a production station, tending the cash register, or taking care of customer service needs on the dining room floor.

I can remember many times when two company employees would meet in the cafeteria and say something like this: "Hey Joe, I have been meaning to call you about project X. I'm glad I met you here the cafeteria. Could we eat breakfast or lunch together to cover some of the details?" What is it worth to the company to have those meetings take place? What's it worth to the employee to have the ease of contact with his/her fellow employee? It's difficult to put a dollar figure to it, but the value does exist.

COFFEE SERVICE BENEFITS TO THE EMPLOYER