The top 15 contract caterers in the UK market are collectively generating more than £5 billion a year in sales, new figures revealed.
Compass Group remains far and away the largest player in the sector with UK revenues of £1.98 billion last year. Sodexo takes the number two position, with sales of £1.19 billion, although its acquisition of Centerplate last week could potentially lead to it closing that gap.
Compass and Sodexo are the only two caterers that exceed the £1 billion turnover mark.
Third-placed WSH posted sales of £633m last year. After that, the next player (Elior) generated £295m, with the rest of the market a picture of fragmentation.
Overall, the revenues of the largest 15 contract caterers equated to £5.08 billion in 2016.
The figures were revealed in the British Hospitality Association’s annual Food Service Management Report, which estimates that the UK foodservice management sector was worth £35 billion last year.
The study forecasts that, despite expectations of a period of unprecedented change caused by Brexit, there will be growth in the short and medium term, stimulated by demographic trends, the ageing population and rising student numbers.
The major FSM businesses who answered the survey forecast they would add 32,000 new jobs next year but, with 31% of their workers coming from the EU, respondents were concerned about post-Brexit immigration and restrictions on the UK labour market.
The survey reveals that the industry’s confidence in government support for it slipped further, and that the main ‘ask’ from government is that they support ways to improve attractiveness of catering as a long-term career choice.
Businesses want a more measured approach to the National Living Wage and a stronger recognition of the importance of immigration.
The top factor constraining growth, said respondents, is rising food cost inflation with staff recruitment difficulties the second.
Looking to the future the industry recognises the rise of new trends with healthy eating and street food important as well as smart payments.
Self-service kiosks and online ordering are seen as key trends for the future. Recognised brands are seen as a major part of the future, too.
The industry showed that it is firmly behind the government’s ambition to combat obesity and increase the nation’s health with almost all companies reducing the amount of sugar and salt in their offerings and providing healthier alternative meals.
Simon Stenning, executive director of MCA, which compiled the report said: “This complex market has been constantly evolving to face new challenges, and these keep coming, but the resilience of the leaders within it will ensure that it sees further growth. The key challenge from a catering perspective will be how to embrace retailing techniques and skills to fight off stiff competition from the High Street, whilst balancing the need to be ‘foodie’ caterers.”