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What are Contract Foodservice Management Companies?

February 8, 2018

Contract Foodservice Management Companies | M Source Ideas

Ever wondered who the chefs, servers, and cashiers in your high school or college cafeteria worked for?  Pretty likely they were working for a contract foodservice management (CFM) company, like Sodexo, Aramark or Compass.

Why does that matter if you’re in the food industry? Well, if you’ve ever wondered about how to sell to those companies, read on, because we’re going to explain more about how these companies work and how they bring on new vendors.

The big picture

Contract-managed companies operate in K-12 and college, as well as the healthcare (hospitals), corporate office, and military sectors (read more about the non-commercial foodservice industry here) and have a big chunk of the $200B (U.S.) non-commercial foodservice sector.

The largest ones are Sodexo (based in France), Aramark (based in Philadelphia), and Compass (based in England),  but there are also smaller, regional companies as well.

Here’s a list of the top ten largest foodservice contract management companies in the U.S. (as of January 2022):

Rank* | Company | Website
1 | Compass Group North America | www.compass-usa.com
2 | Aramark | www.aramark.com
3 | Sodexo | www.sodexousa.com
4 | Delaware North Companies | www.delawarenorth.com
5 | Centerplate | www.centerplate.com
6 | AVI Foodsystems | www.avifoodsystems.com
7 | Thompson Hospitality | www.thompsonhospitality.com
8 | Trusthouse Services Group | www.trusthouseservices.com
9 | Healthcare Services Group | www.hcsgcorp.com
10 | Guest Services, Inc. | www.guestservices.com

Contract-managed foodservice companies | M Source Ideas

What about centralized buying?

Besides the convenience of outsourcing all the complexities of running a dining operation, a CFM is also of value to, say, a college, because they have large buying power with their food vendors. They can buy in huge volumes and pass some of those savings along to the college or hospital.

This means the central buying offices of these companies are major gatekeepers.

Market with the consumer in mind

The end-user or consumer is the most important factor in getting the attention of these central buyers. Your product needs to be relevant to the consumer, and therefore relevant to the CFM centralized buyer. In the case of a college dining operation, that would be the students.

College students are increasingly aware of the sustainability of the food products being offered in their college cafeteria and the health benefits of those products, for example. As the end-user becomes more discriminating, food suppliers who understand and cater to the concerns of the end-user can make inroads with contract management companies and win their attention.

Ultimately, everything comes down to the contract foodservice management company’s ability to compete in the market by offering a great service to their clients (colleges, hospitals, etc.) that in turn helps support the client’s mission, while also being cost-effective.

Next steps

  • Make sure your product is relevant to the end-user which will differ for K-12, public or private, college, hospitals, or others. Build your sales narrative around that.
  • Research what other products your CFM is using in your category and make sure you actually have something to offer that is different and better.
  • Attend and exhibit at the relevant conferences and trade shows in your chosen vertical.
  • Hit up the relevant buyers at the headquarters of the CFM’s you’re targeting.

While it won’t necessarily be an easy or fast process, selling to contract foodservice management companies is critical if you want to penetrate the non-commercial foodservice space.

Noncommercial Foodservices Contract Management Companies

And don’t forget, that’s what we do; if you’d like a discovery call with us to discuss how we may be able to help, you can schedule that here.

Not quite ready to schedule a call? Learn more about the 5 Stages of Growing a Food & Beverage Business.

Share the knowledge

You might also like:

  1. Difference Between Self-Operated and Contract-Managed Foodservice
  2. What are the Trends in College Dining Services?
  3. How to Sell into the College and University Food Service Industry
  4. 5 Markets for Food Companies You May Have Overlooked

Filed Under: B2B Marketing, Food & Beverage, News/BlogNext: The Rise of the Hamburger HippiesPrevious: Difference Between Self-Operated and Contract-Managed Foodservice

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Lionel Binnie, Founder, M Source Ideas

Over two decades spent solving hard, B2B marketing problems in the food services and consumer products space.

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