Our new £25 million catering contract - who earns out of it?!!

[brighton bluenose]

What I can't quite get my head round is that it was recently reported that a £25 million 5 year deal was done with the new caterers............SO may be a daft question but are we paying them £5m a year OR are they paying us £5m a year?!

If it is the former (which seems unlikely) - assuming they get free use of all our kitchen equipment etc and take all of the generated profit why on earth are we paying them?!

If it is the latter - then surely they expect to earn the £5 million a year in profit to pay us before they make any profit for themselves so SURELY it would be better to keep this in-house and reap the benefit of the £5m profit AND the profit they would earn??!!!

Or have I missed something?!

 

[BensGrandad]

I would think that they pay us and yes in house could possibly be better financially for us but perhaps this is the thinking of a year contract. By the time the contract expires we should or my be well established enough to take over the catering n house if not it goes out to tender again. Perhaps it is too much for the club to take on at the moment as we are still finding our feet at The Amex and as a club hoping to reach the Premier.

 

[Return of the Rev]

Yep they give us 5 million a year SO THAT MEANS THEY MUST TAKE 50 TO 100 MILLION A YEAR,SO 2 MILLION PLUS A GAME AROUND A £100 EACH PLEASE GET A GRIP WITH THE FIGURES

 

[Blue Valkyrie]

They give us 5 million, keep the first 5million+ profit, and share profit above that figure with us.

They also become the 'bad guy' for the club.

 

[Hatterlovesbrighton]

Too many overheads for what is in reality an operation that is in use for less than 40 times a year.

Far easier to employ an expert to do it and get a certain fee from it than take the risk of either the upside or downside of doing it yourself

 

[One Love]

I would be surprised if they made much after paying £5m to the club each year.

 

[Herr Tubthumper]

I would be surprised if they made much after paying £5m to the club each year.

They do non-match day catering as well so they can claw back money during the week as well as match days.

 

[brighton bluenose]

Yep they give us 5 million a year SO THAT MEANS THEY MUST TAKE 50 TO 100 MILLION A YEAR,SO 2 MILLION PLUS A GAME AROUND A £100 EACH PLEASE GET A GRIP WITH THE FIGURES

I think the NOT TOO SUBTLE point was - WHY THE FVCK ARENT WE DOING THIS IN-HOUSE and keeping the £5 million PLUS the profit that the caterers earn!!

Just say 10 catering managers to organise it all on £50k a year each leaves £4.5m let alone the further profit - it can't be that fvcking difficult surely!!!

 

[nwgull]

I think the NOT TOO SUBTLE point was - WHY THE FVCK ARENT WE DOING THIS IN-HOUSE and keeping the £5 million PLUS the profit that the caterers earn!!

Just say 10 catering managers to organise it all on £50k a year each leaves £4.5m let alone the further profit - it can't be that fvcking difficult surely!!!

It's a football club; they need to concentrate on making profit from the football side of things.. Sub-contracting to a company that knows how to run a catering operation will probably make more money than doing it in house.


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[Spun Cuppa]

It's a football club; they need to concentrate on making profit from the football side of things.. Sub-contracting to a company that knows how to run a catering operation will probably make more money than doing it in house.

It will be great when this happens

 

[HenryC]

I reckon they need to take about 275k per match at 70% net margin to make £5m profit over about 26 matches. That's about £10 per supporter. After paying us £5m they will have to work very hard for their crust. Seems a great deal for BHA to me....

 

[Jim in the West]

I would imagine we'd be getting around 25% of revenue, which implies £20m of revenue pa, or over £750k per match (excluding non match day takings, which I have no idea of. Working back, that's an avge spend of £25 per person, which simply doesn't compute. The missing bit must be the non match day stuff, which could be quite considerable (Christmas parties, etc, etc).

 

[Seagull by the Sea]

What I can't quite get my head round is that it was recently reported that a £25 million 5 year deal was done with the new caterers............SO may be a daft question but are we paying them £5m a year OR are they paying us £5m a year?!

If it is the former (which seems unlikely) - assuming they get free use of all our kitchen equipment etc and take all of the generated profit why on earth are we paying them?!

If it is the latter - then surely they expect to earn the £5 million a year in profit to pay us before they make any profit for themselves so SURELY it would be better to keep this in-house and reap the benefit of the £5m profit AND the profit they would earn??!!!

Or have I missed something?!

I went to a meeting tonight at the Amex to discuss catering, finances were not discussed but it was clear that the club loses money at the moment through catering (I am not talking about the concourses).

It was also clear that all the equipment used in the kitchens belonged to the catering company, not the club.

I would say, therefore, that we pay them the money (if it is £5m per year) and the club takes all the profits. I can't imagine it works differently from that. The club were very happy to confirm that they LOST money last year from the dining in 1901 etc. so can't see that would be the case unless we were paying the caterers and keeping the (non) profit?

 

[theonesmith]

I went to a meeting tonight at the Amex to discuss catering, finances were not discussed but it was clear that the club loses money at the moment through catering (I am not talking about the concourses).

It was also clear that all the equipment used in the kitchens belonged to the catering company, not the club.

I would say, therefore, that we pay them the money (if it is £5m per year) and the club takes all the profits. I can't imagine it works differently from that. The club were very happy to confirm that they LOST money last year from the dining in 1901 etc. so can't see that would be the case unless we were paying the caterers and keeping the (non) profit?

This sounds much more realistic

 

[Hippo25]

Total revenue will be expected to be 25m over the contract period, the caterer will recover costs and will be paid a management fee and the club will keep profit. If no profit is made then the caterer isn't performing and the contract would be cancelled ( as happened last season I suspect).

 

[saafend_seagull]

Wow if we pay them £5m a year.

No wonder why they don't care about the service with £5m locked up.

 

[CP 0 3 BHA]

Having read this thread I'm not sure I'm any the wiser.

 

[Justice]

I would think that they pay us and yes in house could possibly be better financially for us but perhaps this is the thinking of a year contract. By the time the contract expires we should or my be well established enough to take over the catering n house if not it goes out to tender again. Perhaps it is too much for the club to take on at the moment as we are still finding our feet at The Amex and as a club hoping to reach the Premier.

Basic maths per head per game being generous would only bring in around 500k from match days?

 

[Timbo]

It still amazes me how the club manage to lose money at just about everything they do.

 

[Justice]

Basic maths per head per game being generous would only bring in around 500k from match days?

I should add 500k per season not match.