The Future of Workplace Cafeterias and Micro Market Foodservice
Could micro markets replace cafeterias in workplaces? The idea isn’t all that far-fetched. In fact, 52 of 60 recently surveyed operators said they “definitely” think it’s possible. Whether cafeterias go away for good is uncertain, but one thing is clear: Big changes in the corporate foodservice space are underway.
The onset of the COVID-19 pandemic early last year forced millions of Americans to work from home—and, with many office spaces abandoned, workplace cafeterias and micro markets had to shut down. The future of these locations rests in part on what percentage of the workforce returns to the office when it’s safe to do so. Although coronavirus cases are declining and vaccinations are rising, many companies still haven’t committed to a timeline or strategy for bringing employees back.
Cafeteria locations with fewer than 700 people will struggle to be profitable, says micro market specialist Steve Closser, cofounder and chief integrator of Translucent LLC. He’s advising convenience service operators to expect office populations to be at about 50% capacity (compared with pre-COVID levels) for quite some time.
Despite typically working longer hours at home, most people enjoy working remotely and want the option to keep doing so after the pandemic, according to a recent Harvard Business School Online survey. “The past year has been difficult for everyone, but what’s surprising is how well people feel they’ve performed at work, while at home,” says HBS Online Executive Director Patrick Mullane. “Now, as we’re preparing to get back to ‘business as usual,’ it seems professionals don’t want ‘business as usual.’ Instead, they want flexibility from their employers to allow them to maintain the new work/home balance and productivity they have come to enjoy.”
Although working professionals miss their colleagues, 81% of those surveyed by HBS Online said they either don’t want to go back to the office or would prefer a hybrid schedule from now on. Of this group, 27% hope to work remotely full time and another 61% would like to work two or three days a week from home. Only 18% of respondents want to go back to the office full time.
What does this mean for micro market operators? Closser says corporate cafés will downsize accordingly: Large units will become medium ones; medium units will become small ones; and most small units simply will close. “This has been happening pre-COVID, but the trend accelerated during the pandemic,” he observes.
Here, six micro market operators share how their businesses have navigated this pandemic-influenced transition.
Capitalize on Strengths
With more than 10,000 micro markets in the United States, Canteen is the nation’s largest convenience service operator. It’s also owned by one of the nation’s largest manual foodservice operations, Compass Group North America.
“For us, because we’re nationwide, we understand the value in unattended retail,” says Mike Coffey, chief strategy and innovation officer for Canteen North America. Although the company’s micro market revenue took a hit during the first four months of the pandemic, it began to rebound in the summer. Thanks to the micro market’s ability to supplement cafeterias, Canteen’s micro market revenue finished 2020 unchanged from the previous year.
Takeaway: The nation’s largest micro market and manual foodservice provider has embraced the unattended market as an alternative to cafeterias—and will continue to do so in 2021.
Pivot as Needed
Pre-COVID, American Food & Vending (AFV) of Woburn, Massachusetts, couldn’t get a sales meeting with a multi-tenant office building. At the time, these locations were almost always equipped with manual cafeterias. Once the crisis struck last year, AFV’s micro markets became highly attractive to these building operators—and began replacing many of those cafés.
“A micro market isn’t like a vending machine; it’s a food store,” explains Vice President Pat Arone. “Unlike a cafeteria, we can sell a fresh sandwich without the onsite labor cost. And we do it 24/7.”
Takeaway: Locations previously served by labor-intensive cafeterias are prime real estate for micro markets.
Maumee Valley Group reinvented its fresh food program in 2020. The Defiance, Ohio-based company is among the few vending and market operations that runs its own manual foodservice. It also operates two commissaries. As its cafeteria operations contracted, micro markets—and fresh food sales within—grew significantly.
“Fresh sells better in markets,” says Jordan Plassman, who runs Maumee Valley’s commissary division. “We make fresh items under several private labels. Throughout the pandemic we were producing eight unique items daily and didn’t duplicate any for up to six weeks at a time.”
Takeaway: Fresh food offerings are the most important part of your micro market.
Camelback Vending’s business came to a screeching halt at this time last year, as it did for most operators. “We do a lot of school accounts, so much of our business paused with the arrival of COVID-19,” Owner/COO Jodi Glimpse explains.
Then, in June, the Phoenix-based operation “started getting calls from clients looking for new ways to provide food and drinks to their employees,” Glimpse continues. “We learned quickly that you need to keep track of location traffic—one week you could have 200 at work, the next only two.”
Takeaway: Communicate often with location management about staffing schedules—and tailor your food menus appropriately.
Capital Provisions of Los Angeles offers its customers a delivery location (pin to map) feature on Vagabond Vending’s vīv market app. “With viv Delivery, we partner with local delis and restaurants to provide delivery service to particular locations,” says Frank Conley, market programs manager for Capital Provisions. Customers of a specific micro market location can use the app to place orders, and the foodservice provider makes a daily delivery to that location to fill those orders.
Takeaway: Customers want to order food on their phones or computers, and some micro market platforms support this. Make sure yours does too.
Canteen Victoria is bullish on smart coolers—the food and beverage coolers equipped with devices that secure access, stabilize temperatures, and accept most forms of payment. So bullish, in fact, that the Texas-based company is planning to install them in private workplaces and semi-public venues like hospitals.
“The fresh-food cooler can complement a hospital’s manual cafeteria, which isn’t open 24 hours a day,” explains General Manager Hersey Williams. “We plan to add smart coolers, which offer a new way for customers to buy food, to traditional vending installations.”
Takeaway: Introduced one year ago, the smart cooler is a game-changer for operators, allowing them to boost their fresh-food capabilities in locations where micro markets will complement or replace a cafeteria.
The (R)evolution Continues
While the legacy cafeteria may soon be eclipsed by other methods of food delivery at work, manual foodservice won’t disappear entirely. The cafeteria is evolving too.
“Full-service cafeterias will never be the same, and their numbers will continue to decline,” says Fixturelite Cofounder Steve Orlando. “But they will adapt. Today, it’s not about what you’re doing; it’s about how you’re doing it. And manual service is changing.”
Expect foodservice personnel to remain behind plexiglass. Prepare for the fact that salad bars and buffets may never return—and that deli, pizza, and meal stations could be replaced by preordered foods in containers at most cafeterias.
Where there’s an opportunity for micro markets to supplant cafeterias, there’s also an opening for cafeterias to work with micro markets. For instance, the new generation of micro market kiosks and apps can display menus, take orders and send tickets to kitchens, Orlando points out. Integrations like this are seamless.
Versatile by design and economical to operate, micro markets proved to be efficient foodservice solutions during the pandemic, and they could experience even greater success in the post-COVID years. Operators must be ready to meet the demand with additional equipment, new technology, careful planning and an increased frequency of fresh-food deliveries.