The Food Services Cost Array Analysis is designed to show the breakdown of costs associated with the provision of Food Services within a Food service, Catering or Cafeteria operation and the related expected increase in the supply chain sub-components based upon current market conditions.  Updates will occur at least semi-annually, but more frequent as market conditions change based upon market variability, supply chain disruption criticality of events, and velocity of market conditions.  The analysis will be updated once the cost of a barrel of oil drops to <$75.00, but semi-annual cadence of updates will continue thereafter or in the even the cost of oil increases.

Overview

Food Services Distribution Expense Detail 

 0 %

Service Cost Reduction

Buying Power Leverage

• Compare "total" costs
• Renegotiate prices and "should costs"

• Consolidate number of suppliers
• Redistribute volume among S/P/D suppliers

 10%

 20%

 30%

 40%

 50%

 60%

 70%

 80%

 90%

 100%

Labour Expense 47%

Food Expense 37%

Operating Profit 8%

Indirect Costs 4%

Fuel Expense 3%

Transaction Cost 1%

• Estimated Supplier Annual Increase = 10-13%
• Removing Fuel increases the 
  estimated Supplier Increase - 8-9%
  

Opportunities

Link to Key Metrics

P & L Expense Factor          Transaction Cost    Fuel Expense    Indirect Cost    Operating Profit    Food Expense    Labour Expense      TOTAL

                                                           1%                              3%                    4%                        8%                         37%                      47%                   100%     

Key Cost factors

• Brent Crude Cost / Barrel  - $ 99.60
  
• Cost Reduction Marker -  (we should request supplier cost reduction when the cost per barrel of oil hits ) -  $ 75.00
  

FS-010 Ver 1.2 (May 24)

The Food Services Cost Array Analysis is designed to show the breakdown of costs associated with the provision of Food Services within a Food service, Catering or Cafeteria operation and the related expected increase in the supply chain sub-components based upon current market conditions.  Updates will occur at least semi-annually, but more frequent as market conditions change based upon market variability, supply chain disruption criticality of events, and velocity of market conditions.  The analysis will be updated once the cost of a barrel of oil drops to <$75.00, but semi-annual cadence of updates will continue thereafter or in the even the cost of oil increases.

Overview

Food Services Distribution Expense Detail- Non-Union 

 0 %

• Hiring due Diligence process
• GPO back-side rebate
• Safety a priority to reduce premiums
• Credit Card fees
• Proper work methods-reduce injury
• Training & Development
• Business / Process labour efficiency
• Vacation labour
• Ensure accurately deployed headcount
• Regional expenses
• Manage occupancy / kitchen expenses
• Manage Admin / Management fees

 10%

 20%

 30%

 40%

 50%

 60%

 70%

 80%

 90%

 100%

Labour Expense 42%

Food Expense 35%

Admin Fee 8.5%

Management Fee 7.1%

Credit Card Fee 3.4%

Benefits 2 %

Burden 2%

Includes:

• Occupancy Costs
• Technology
• Miscellaneous Costs
• Other Direct Costs

• Hire the right people
  
• Wage motivation programming
  
• Compliance reporting
  
• Better Workmen’s Comp ratings experience lower rates
  
• Use of Technology
  
• Hi-efficiency equipment
  
• Trained Supervision and employees 
  
• Safety  Program/Training
  
• Proactive not reactive
  
• Share productivity gains
  
• Leverage the scale of the supply chain
  
• SQD – Service Delivery
  
• Resource Utilization
  
• Collaborative work environment

Costs as a % of Revenue

Food Services

Cost Array-Non Union - 2024

Suppliers / Pricing

Page 2 of  3

Key Points

FS-010 Ver 1.2 (May 24)

The Food Services Cost Array Analysis is designed to show the breakdown of costs associated with the provision of Food Services within a Food service, Catering or Cafeteria operation and the related expected increase in the supply chain sub-components based upon current market conditions.  Updates will occur at least semi-annually, but more frequent as market conditions change based upon market variability, supply chain disruption criticality of events, and velocity of market conditions.  The analysis will be updated once the cost of a barrel of oil drops to <$75.00, but semi-annual cadence of updates will continue thereafter or in the even the cost of oil increases.

Overview

Food Services Distribution Expense Detail- Union 

 0 %

 10%

 20%

 30%

 40%

 50%

 60%

 70%

 80%

 90%

 100%

Labour Expense 44%

Food Expense 33%

Admin Fee 8.5%

Management Fee 7.1%

Credit Card Fee 3.4%

Benefits 4 %

Burden 2%

Key Points

Includes:

• Occupancy Costs
• Technology
• Miscellaneous Costs
• Other Direct Costs

Costs as a % of Revenue

Food Services

Cost Array - Union - 2024

Suppliers / Pricing

Page 3 of  3

FS-010 Ver 1.2 (May 24)

• Hiring due Diligence process
• GPO back-side rebate
• Safety a priority to reduce premiums
• Credit Card fees
• Proper work methods-reduce injury
• Training & Development
• Business / Process labour efficiency
• Vacation labour
• Ensure accurately deployed headcount
• Regional expenses
• Manage occupancy / kitchen expenses
• Manage Admin / Management fees

• Hire the right people
  
• Wage motivation programming
  
• Compliance reporting
  
• Better Workmen’s Comp ratings experience lower rates
  
• Use of Technology
  
• Hi-efficiency equipment
  
• Trained Supervision and employees 
  
• Safety  Program/Training
  
• Proactive not reactive
  
• Share productivity gains
  
• Leverage the scale of the supply chain
  
• SQD – Service Delivery
  
• Resource Utilization
  
• Collaborative work environment