November 06, 2013

Train catering: Achilles’ heel or unique selling point?

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Train catering if it is done well has the ability to become a unique selling point for long-distance passenger operators, but it can also be an Achilles' heel if it is done badly. As David Briginshaw explains, while there is a wide disparity between what operators choose to provide, there is also considerable innovation.

SOME years ago German Rail (DB) announced it was going to abandon traditional restaurant car services on its ICE trains to reduce costs. But DB managers were quickly persuaded to think again following a public outcry, and today DB offers one of the most comprehensive train catering experiences in Europe.

This demonstrates that passengers expect and appreciate good-quality catering on a journey. Indeed, the ability to enjoy a tasty meal on the move is not only one of the pleasures of rail travel but also one of its strengths which sets rail apart from other modes. Unfortunately, not all operators appreciate this, often focusing too closely on the cost of providing catering without realising its wider benefits such as improving the attractiveness of rail compared with other modes. Worse still are those operators which proudly announce they want to emulate airline-style catering. When do you ever hear people raving about the food on airlines? Railways can and should do much better.

Obviously the optimum level of catering is determined by the type of service being provided, the length of the journey and the time of day. Generally, the longer the journey the greater the need becomes, although not all operators appear to realise this. In Britain, Arriva CrossCountry's decision to rip out the innovative shops on its Voyager trains and replace them with bicycle racks and a very-limited trolley service on trains which run the length of Britain is a good example of an operator disregarding the needs of its passengers.

The expansion of high-speed services has had an impact on catering, but even so the type of catering provided varies considerably between operators. For example, both Eurostar and Thalys provide meals and refreshments to passengers at their seats in first class which is included in the price of the ticket. This contrasts with the policy at French National Railways (SNCF) which only offers cold meals to passengers travelling TGV-Pro-business first class to a limited number of destinations from Paris for which there is a charge. These passengers are also welcomed on the platform prior to boarding and receive a complimentary travel pack. Otherwise, passengers have to visit the buffet car to purchase refreshments.

In a country like France which prides itself on its cuisine it seems strange that the national train operator cannot produce a more interesting and appetising offer even on domestic TGV journeys lasting up to 5h 30min. However, TGV passengers travelling from France to Switzerland and northern Italy are offered an at-seat meal service in first class. This is probably in response to greater competition from air on these routes and the fact that Swiss and Italian passengers are accustomed to receiving more than just a snack. Swiss Federal Railways (SBB), for example, provides restaurant cars on its inter-city trains even though the journey time from Geneva to Zurich is just 2h 45min.

There are clearly several schools of thought on the prcateringovision of meals. East Coast in Britain decided to replace the traditional restaurant cars on its services running from London to Leeds and Edinburgh with an at-seat meal for passengers travelling first class included in the ticket price. East Coast says since it launched the complimentary food and drink service in May 2011 it has helped to achieve a 19% increase in first class ridership.

Fine dining

In contrast, another British operator, First Great Western (FGW), favours the traditional approach. Having cut back the number of trains with restaurant cars to just four, it decided at the beginning of this year to revitalise the service offered on the London - Penzance route by engaging a local restaurateur, Mr Mitch Tonks, to help it devise new menus using locally-sourced produce cooked on board by trained chefs. At the same time, staff were issued with new uniforms and the service was rebranded to provide a fine-dining experience. In June, restaurant cars were reinstated on two more trains to build on the success of the relaunch. FGW says the initiative is part of its commitment to supporting the communities it serves and providing a high-quality service, rather than simply trying to boost revenue. FGW also has chefs on board some of its other trains offering an at-seat hot meal service.

DB bridges the divide between at-seat dining and restaurant cars by offering both on its ICE and inter-city trains. As the trains travel the length and breadth of Germany making frequent stops en route, the 250 restaurant cars it operates are open all day offering anything from drinks and snacks to full meals. In addition, passengers in first class are offered an at-seat service of refreshments and meals served by the on-board crew.

Earlier this year, DB engaged a well-known television chef, Mr Horst Lichter, famous for his distinctive moustache, to devise three organic meals for each season of the year. At the same time DB pays €0.10 per meal to a forestry protection and preservation project.

VR Group in Finland has five different types of restaurant cars on its long-distance trains ranging from Prego Italian restaurants on Pendolino trains, to classic Finnish food on inter-city trains, and 1970s-style restaurants and a pub car on its Helsinki - Lapland services.

All types of catering need to be promoted to maximise the benefit. Where services are included in the price of a first-class ticket this should be advertised as one of the advantages of travelling first class. Catering for which passengers have to pay requires both general advertising and specific promotion to clarify exactly what is available on which train and when, backed up by announcements and promotion on board each train. Renfe, Spain, for example lists precisely what is available on each train on its website.

It is notoriously difficult to make money from on-board catering because of the high logistics and staff costs, but in the face of hostility by some US congressmen, Amtrak announced last month that it plans to eliminate train catering losses during the next five years. This might seem a tall order as it has taken it around seven years to increase the cost recovery rate from 49% to 65%.

"We have made steady and consistent progress, but now it is time we commit ourselves to end food and beverage losses once and for all," says Amtrak's president and CEO Mr Joe Boardman. "Our plan will expand initiatives that have worked, add new elements, and evolve as updated information and opportunities lead us to better solutions."

Amtrak cuts losses

Amtrak says it has reduced train catering losses from $US 105m in fiscal 2006 to a projected loss of $US 74m for the current financial year. It says 90% of losses are incurred on the dining cars provided on long-distance trains, whereas its café cars either break even or make a profit.

Amtrak will consolidate operations and accountability for train catering into a single department, with a long-distance services general manager and route directors responsible for the financial performance of specific trains. Amtrak plans to align dining car staffing with seasonal changes in demand, establish metrics to assess the sales performance of staff, reduce food wastage and track on-board stock levels more closely, change menus regularly, and test new pricing and revenue management options to improve cost recovery.

Amtrak also intends to automate financial reporting to reduce errors and save time. Next year it will roll out a point-of-sale system which it says will speed up the payment and receipt process, provide real-time inventory status, and make it easier to introduce special offers. Amtrak will also test cashless sales on some routes next year to cut transaction times and accountancy costs, and reduce the risk of fraud. "Many venues that have pursued similar initiatives have seen increased sales," says Boardman. "This model is very popular in the airline industry and has been seen as a favourable change for travellers."

If Amtrak is successful at eliminating train catering losses, while continuing to offer a high-quality service on its trains, it will have railway catering managers descending on it from around the world to see how it is done.

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