On what routes, if any does on train catering make a profit?

[whoosh]

20% VAT on items on a train as it's considered 'eating in' - a luxury attacting the Value Added Tax, versus 'eating out' - takeaway food 0% VAT at all the shops on a station concourse.

Quite apart from the less busy trains and non-productive selling times during train turnarounds, this is a considerable factor pushing prices up on trains, or raising costs, which makes on train catering less desirable for both customers and TOC's.

 

[Bletchleyite]

Other than settling for vending machines - the train company should directly employ the staff, manage them well to ensure high coverage and other than booze, resist the temptation to sell luxury junk - just cheapo Kenco(ish) coffee for £1. Those instant £1 coffees will sell out and make far more profit than seen on one current (failed) intercity company, not unknown to sell just three cups of not "Starbucks" at £3.40 a tepid cup - on a busy 250 seat five-car train.

£1 then is probably about £3 now to be fair. It certainly is in beer price terms.

Instant won't sell. People want quality espresso based coffees now.

 

[dk1]

Station catering has definitely improved considerably over the last 30 years, so this would obviously reduce demand for on train catering.
At most stations, there is going to be far more choice and better quality options from the station outlets. There is also the risk that the catering on the train will not unavailable even if the service is advertised as having catering.

Much of that has to do with franchising. Before that only a couple if that had total control. I remember nobody else at one time was allowed to sell tea, coffee or sandwiches other than Travellers Fare.

 

[jumble]

A good example of catering, was, after three successive companies went bust, on a "short term" basis, one train company went 'self employed'. Basically, the stuff was bought from a supplier & management company, the staff got no wages, just a uniform.

A prepacked Kenco cup of tea, coffee or hot chocolate was bought for £0.66 and sold for £1. (ie supplier 66%, concessionaire 34%)
Most items on the trolley were 34% except Sandwiches, 50% - as these are often unsold & wasted.
In some weeks, staff would take £900, and keep £300. In some weeks, staff would take £1800, and keep £600.

Unsurprisingly, this was the most successful catering operation the railway had ever known. Keen staff, flying through the train, almost zero sickness, every train covered, no shortage of applicants.

Now, 25 years later, that wouldn't happen. Unfortunately, with all the RailGourmets etc ...vulture firms wanting to take a cut pushing coffee to £3.50, catering will never be profitable. But this proves a point - the cheap £1 coffee will sell, if advertised well.

Other than settling for vending machines - the train company should directly employ the staff, manage them well to ensure high coverage and other than booze, resist the temptation to sell luxury junk - just cheapo Kenco(ish) coffee for £1. Those instant £1 coffees will sell out and make far more profit than seen on one current (failed) intercity company, not unknown to sell just three cups of not "Starbucks" at £3.40 a tepid cup - on a busy 250 seat five-car train.

One can buy 25 Kenco coffee Prepacks ( admittedly for vending machines so the cups on a train might cost a bit more but bulk buyig will reduce this
) today for £4.50 which is 18 pence each so why the costs 25 years ago should have been 66p is an extraordinary mark up % for someone
Note that spoons will do take away latte for £1.29

Kenco Smooth Roast Coffee Refill Pack of 25 | Viking Direct UK

Looking for Kenco Smooth Roast Coffee Pack of 25? Look no further! Our selection has everything you need to find the ideal solution for your needs.

www.viking-direct.co.uk

actually take away cups cost 4 p eack

https://www.nisbets.co.uk/nisbets-essentials-hot-cups-and-lids-pack-8oz/hw634?vatToggle=incvat&cm_mmc=PLA-_-18095569423-_--_-&cm_mmca1=go_18095569423____c_&kpid=go_cmp-18095569423_adg-_ad-__dev-c_ext-_prd-HW634_sig-EAIaIQobChMIw_z664CfkQMVuZdQBh2AvxIbEAQYAyABEgKaE_D_BwE&gad_source=1&gad_campaignid=18094162212&gbraid=0AAAAAD_ES7op1UCbDzmMKrd4T9Pz_twWn&gclid=EAIaIQobChMIw_z664CfkQMVuZdQBh2AvxIbEAQYAyABEgKaE_D_BwE

 

[waveyswirley]

I definitely wouldn't rely on on-train catering for a meal. I occasionally get a coffee on a Newton Abbot - Birmingham New Street Crosscountry journey as the coffee providers at NTA are nothing to write home about. However for most journeys, there's usually better quality food or drink to be had from the station. I also occasionally enjoy a Madri from the trolley on the Liverpool Lime Street - Manchester Oxford Road EMR service when I'm off to a gig...

 

[williamn]

A can of wine sounds awful.

It sounds awful but the wine is just as good (if not better) than in a bottle!

I was impressed by a catering trolley in Austria recently which even had an espresso machine on it.

I think one of the biggest reasons for lack of take up of on-train catering, other than better retail at stations, is unreliability. TfW's restaurant is great when it runs, but there's such a huge chance it won't be available that you're not going to take the risk. Ditto with Scotrail - no one (other than users of this site...) is going to check the website to see what trains catering is on, you need to just know that if you take a train between, say, Aberdeen and Edinburgh, that there'll always be catering on it.

 

[Sonic1234]

I expect on train catering is a service which is used by those who aren't price sensitive.

Those on the lowest tiers of Advances probably wouldn't consider it.

 

[dk1]

I expect on train catering is a service which is used by those who aren't price sensitive.

Those on the lowest tiers of Advances probably wouldn't consider it.

I would imagine many purchase because they’re bored and want to pass the time. I don't notice many on longer distance trains who are overly bothered. One of my friends working the Norwich-London route today on a trolley took £385 on a return trip just supporting her colleague on the cafe bar.

 

[Manclad83]

In the airline world, tea & coffee is a big money earner and these days they tend to go for the various high street coffee brands.

 

[tumbledown]

I expect on train catering is a service which is used by those who aren't price sensitive.

Those on the lowest tiers of Advances probably wouldn't consider it.

I expect those on Advances have more money left to spend on non-essentials.

 

[Falcon1200]

An interesting question in the OP. Last week I took an Avanti train from Euston to Glasgow Central and, having a First Class staff pass but not being entitled to take complimentary food, I visited the shop in Coach C. As soon as it opened there was a queue right down the coach! I would think that service, requiring just one member of staff, if not actually profitable, is wholly worthwhile. In First Class however, the multiple members of staff seemed to be very much under utilised.

 

[styles]

Not sure if I've missed it in any comments by the way, but on long distance routes I don't necessarily think making a 'profit' is necessary. If you're on a 5 hour train journey I think offering food is just part of an essential service. Yes people could eat at the departing station and bring their own snacks, but we are talking some quite long journeys during which I think serving some form of food, even if just sandwiches and pop, should be retained.

If you went on a 5 hour flight you would expect some sort of meal service, even if you had to pay for it like on IndieGo.

Yes a local calling service which is 3 hours end to end a trolley service is less essential.

 

[Tetchytyke]

In the airline world, tea & coffee is a big money earner and these days they tend to go for the various high street coffee brands.

It's difficult to compare aviation and the railways because the costs are accounted for differently.

In aviation the cabin crew have to be there anyway, so if you can get them up selling coffee and beer then anything they make is pure profit. That's why the airlines can offer pretty generous commission to cabin crew for sales, especially for sales like perfume.

On the railways the catering crew don't have to be there and so their wages have to be accounted for when assessing profitability.

I am sceptical when TOCs claim that catering isn't profitable though.

A good example of catering, was, after three successive companies went bust, on a "short term" basis, one train company went 'self employed'. Basically, the stuff was bought from a supplier & management company, the staff got no wages, just a uniform.

The TOC involved was National Express Anglia for the catering on the Stansted Express.

It didn't work because the staff involved weren't genuinely self-employed. Some of the main tests for genuine self-employment are whether you can choose your own hours of work and whether you can delegate/substitute your duties to someone else. In that case neither test was passed. IIRC the resulting Employment Tribunals cost them more than they'd saved.

 

[Elmers End]

A can of wine sounds awful.

I'm reminded of our journey from Lisbon to Faro last year on CP, where the buffet car guy was almost a sommelier, recommending very quaffable BOTTLES of wine. Food prices were reasonable as well. It made a long journey more memorable.

 

[185]

The TOC involved was National Express Anglia for the catering on the Stansted Express.

It was Northern Spirit Transpennine, under the Xpress Catering concession. Short term. Ish. 2 years... until the taxman showed up.

You're right, NXEA tried something similar - it didn't work. A short journey on an airport shuttle train - totally different business model.

But one glaringly obvious lesson from the little self-employed project was the difference between the basic cost of stuff and the sale price. This revealed that a whopping proportion ordinarily spent on 'ancillary costs' (ie not staff wages) was eating into what should be a profitable operation. Risk assessments, insurance, licensing & brand agreements, payments to the TOC, six tiers of management - easily destroying the financial viability of the operation.

 

[Jan Mayen]

I'm reminded of our journey from Lisbon to Faro last year on CP, where the buffet car guy was almost a sommelier, recommending very quaffable BOTTLES of wine. Food prices were reasonable as well. It made a long journey more memorable.

Reminds me of an overnight trip from (I think) Madrid to Paris years ago. Shortly after departure, I went to the (empty) restaurant car and asked for a table for one. They said they were full, but they would try and find me somewhere in the second sitting. I got the last place.
Afterwards, I went to the incredibly crowded bar and got served after half an hour.

 

[Tetchytyke]

It was Northern Spirit Transpennine, under the Xpress Catering concession. Short term. Ish. 2 years... until the taxman showed up.

I didn’t realise they’d tried it too. Northern Spirit always were a set of cowboys.

But one glaringly obvious lesson from the little self-employed project was the difference between the basic cost of stuff and the sale price. This revealed that a whopping proportion ordinarily spent on 'ancillary costs' (ie not staff wages) was eating into what should be a profitable operation. Risk assessments, insurance, licensing & brand agreements, payments to the TOC, six tiers of management - easily destroying the financial viability of the operation.

Measuring profit is always a dark art, which is why I’m sceptical when TOCs say catering is losing them money. If you want something to be unprofitable then it’s incredibly easy to dump group costs on the entity.

As you say, licensing costs, group management costs, etc, are all great ways of making sure a company or operation looks like it is losing lots of money.

I suspect catering would wash its face at the very least even on services like Stansted Express but, because the TOCs don’t really want to be bothered with offering catering, they make sure that it looks like it’s losing money.

 

[185143]

Not seen Lumo mentioned. Given it's done by the Ambassadors who also do revenue and customer service duties, so will be there anyway, that must pay it's way?

Indeed, as an entirely commercial operation surely if it didn't make money, they'd scrap it.

 

[sh24]

Onboard catering is a bit like a fitting room in a store. it's not a direct profit generator but it helps make it easier for your customers to buy/travel from/with you and come back again.

 

[Carbean]

In the old days when most expresses had a kitchen car and seating area plus two or three chefs/cooks and several stewards must have been a drain on the finances of BR or pre-nationalisation companies. Unlike now when they are serving for the whole of the journey, in those days you had two sittings for lunch then closed until afternoon tea was served later.

 

[Krokodil]

You often see catering staff pushing their wares through trains without saying a single word and then there are others who have a good sales pitch telling people what they have.

Arriva Wales used to have an infamous one who would list out a nonsense menu as he went down:

"Jellied eels, Mars Bars, weed..."
"You've got weed?"
"No, but you can have a cup of tea"

I think one of the biggest reasons for lack of take up of on-train catering, other than better retail at stations, is unreliability.

I'd trust a fixed buffet to turn up (I've rarely been disappointed by Avanti, nor by FGW in HST days) but I'd never rely upon a trolley.

 

[leytongabriel]

Really appreciate the chance of a cuppa on the Anglia main line. And yes some people push the trolley through quickly without saying anything to minimise any chance of custom, but most are very nice and friendly. And occaissionally you get one who really doesn't fit and you think 'mangement trainee' or 'job coach' ( the people who 'help' jobseekers into work) victim.

 

[a_c_skinner]

Does catering really increase custom? Leaving aside the profit question. The catering offer isn't sophisticated and most passengers could manage to bring a snack and a can of pop. I've enjoyed the food on my rare occasions in first but it wasn't the decider. Wouldn't it be better to simply stop the service and pop a few more seats in?

The best advice I got about catering was at Alnmouth travelling to Arnside. I asked if the coast was a permitted route and the chap said yes, and you get long enough to buy lunch in Carlisle as the coast takes forever.

 

[Russel]

I don't mind catering from an actual buffet, but from a trolley, I don't bother, the cold drinks are never cold and hot drinks never hot.

 

[dk1]

I don't mind catering from an actual buffet, but from a trolley, I don't bother, the cold drinks are never cold and hot drinks never hot.

That’s a standing joke with many trolley staff. One of the best was a gentleman picking up several cans and asking if there was anything colder than this only to be told “yes, the tea”

 

[philthetube]

Could it be done on a genuine self employed basis, the rail company rents out the, pitch, say a specific set of journeys to individuals who then operate them on a self employed basis.

A person operating a regular service would soon build up a decent clientele if they were reliable.

 

[dk1]

Could it be done on a genuine self employed basis, the rail company rents out the, pitch, say a specific set of journeys to individuals who then operate them on a self employed basis.

A person operating a regular service would soon build up a decent clientele if they were reliable.

Isn’t that what the Provincial Sector tried in the the late 80s/early 90s?

 

[Dr Hoo]

Isn’t that what the Provincial Sector tried in the the late 80s/early 90s?

On ScotRail caterers like Inveroykel on the Far North Line were pretty small. The ScotRail Express routes used a larger corporate (not BR) company.

 

[philthetube]

Could it be done on a genuine self employed basis, the rail company rents out the, pitch, say a specific set of journeys to individuals who then operate them on a self employed basis.

A person operating a regular service would soon build up a decent clientele if they were reliable.

Isn’t that what the Provincial Sector tried in the the late 80s/early 90s?

It sort of is but if the operator was to say, for example, you give me £100 a week to run a catering service Monday to friday for three trips a day from Southampton to London, times specified, and were to offer few of these packages to fit busy times then whoever took them up would be self employed, it would be no different to renting a shop. Although offerings would be different the provision would have to be adequate for people to want to buy.

 

[sheff1]

Does catering really increase custom? Leaving aside the profit question.

Depends what you mean by increase custom. I have certainly bought first class tickets on TfW and TPE (west coast) in recent times because of the catering offer. I would have travelled anyway, but in standard, if there was no such offer.