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DELIVERY IS NOW PART OF B&I’S FUTURE
Delivered-in meals through third-party aggregators are likely to be a permanent feature of workplace catering, even for high-end city operators, Lexington’s new Managing Director, Matt Wood, tells Jane Renton.
Are good times about to roll once more for high premium brands such as Lexington? The first green shoots of recovery are springing from the ground after two years of hibernation.
The new managing director of Lexington gazed into his crystal ball just nine days into the new job to predict that Boris Johnson would most definitely abolish most Covid restrictions, including, most notably, the recommendation 40 keep working from home, on 26′ January. His clairvoyancy was spot-on, save for the fact that the prime minister made the announcement several days earlier than anticipated, no doubt spooked into action by the fallout from ‘Partygate’.
The tide seems finally to be turning. Before omicron struck in December, Lexington’s sales were up by 65% compared to the last quarter of the year in 2020. However, they were still some 35% down on where they were before the pandemic struck in the last quarter of 2019.
But there will be no guaranteed return to the old status quo. “I’ve talked to an awful lot of people across a lot of different businesses and industries and they all tell me they want to return to the office, but not for five days a week,” says Matt Wood, who took over the top job at Lexington in early January.
The open and approachable Wood, aged 49, takes over from the highly respected Julia Edmonds, who joined the main board of parent company Elior last year and also now chairs Lexington. Her replacement has an undeniably impressive pedigree in hospitality, having worked across diverse sections of the industry, something that perhaps reflects the blurring of traditional boundaries in the contract catering sector.
Wood studied hotel management in America, working in a variety of five-star resorts, before returning home to Britain where he joined Grosvenor House on London’s Park Lane as a graduate trainee. There he reported to the legendary Sergio Rebecchi, whose tutelage he says provided him with an invaluable template for engaging with staff throughout his career. He also worked for restaurateur Michael Gottlieb, the founder of London restaurant chain Smollensky’s and another inspirational mentor, before turning to contract catering in the early millennium, working initially at Goldman Sachs’ London headquarters before undertaking a variety of senior posts in operations at Restaurant Associates.
It was, however, his more recent diversification into occupational health as the managing director of Health Management Ltd during the start of the pandemic, that really highlighted the necessity of adapting at high speed to rapidly changing circumstances. It was a life lesson that should serve him well in his new post.
“Most people assume that anything to do with health would thrive in that environment, but occupational health suffered as people left their offices,” he explains. The company that he ran for three years had to reinvent itself pretty quickly by introducing a Covid testing service in the months prior to the government giving away free testing kits. The company also developed a new referral service for those suffering from long Covid.”I think the big lesson for us in all of that was that you can’t sit and wait,” he says. “You’ve got to come up with ideas; you’ve got to formulate ideas through collaboration and bring it to market quickly.”
That said Lexington, with a current workforce of some 1,000 employees across 151 sites, tends to work for some of the world’s most successful global companies, many of them in banking, financial services and law. These industries are likely to want to encourage staff back to office working with lavish support packages, central to which is the type of service traditionally offered by caterers such as Lexington.
But nothing in this volatile environment is assured. Two months prior to Wood’s accession to the top job at Lexington, the leadership team had already initiated and launched its own radical move into what Wood describes as “a cloud catering solution”. Lex Unboxed is a supporting dark kitchen established by Lexington in Cheapside, just a stone’s throw away from where most of its City clients are based.
This delivered-in service, which also involves third-party aggregator Just Eat, as well as a variety of third-party delivery companies, is focused essentially on London and the City in particular, but that does not rule out plans for eventually expanding it out to other parts of thecountry. Wood says it is primarily aimed at sites that have fewer than 250 employees and could include new clients, possibly in tech and media. It is also aimed at larger and existing clients who may no longer possess any clear intelligence as to numbers on-site post-pandemic.
“It’s a cloud catering solution that truly does set us apart from our competitors,” says Wood. “It allows us to deliver a fast, immediate and efficient Lexington experience to city clients, where they don’t need a kitchen on-site or a contract in all cases.”
This is not a uniquely Lexington solution to the new office catering landscape. Others have seen the same writing on the wall and have made similar moves. As Allister Richards, CHGCO’s chief operating officer, remarked back in 2020, many such contract caterers, including his own company, are experimenting with this hybrid delivered in concept. But one of the things that appears to differentiate Lexington is Wood’s conviction that delivered-in food is unlikely to prove just a temporary market expedient that will eventually recede once life returns to normal.
“We’ve got to keep trying different routes to market,” he says. “We’re working with the aggregators to really get proper insight in terms of what consumers are purchasing so we can adapt our menus accordingly- it’s part of the mix now and hugely important.” While Wood is confident that his company will continue to provide what he calls “the great Lexington experience” in terms of food and menu, he acknowledges that third-party delivery cannot always guarantee the type of “enhanced hospitality” for which Lexington is renowned. “That won’t always be the case with a straight drop and go delivery service,” he acknowledges. “But there are a variety of options available, and some clients will be adaptable to having a Lexington person on-site to help lay out, present and help serve the dishes.”
Importantly, this new cloud solution also links to Lexington’s own app, LexEats, allowing clients and customers to use a 24-hour booking and payment system, plus click-and-collect facilities and loyalty rewards. It enables Lexington to interact directly with its customers about the various campaigns it is running. It also offers food maps of ingredients and has the ability to capture dietary and allergy information relating to app users. “It generates a lot of useful data about what consumers are purchasing,” says Wood.
All these initiatives are running alongside the elephant in the room: the labour and skill shortages that beset virtually every caterer in the land, big or small. And, of course, moves towards hybrid models in a market that may not be able to afford full-service catering on-site will place fewer demands when it comes to front-of-house staff in a severely constrained labour market.
Attracting and retaining good staff to high-end catering companies is probably the biggest challenge facing Lexington right now. “I would say that the ability to attract people into our industry, into our company, is the biggest challenge of 2022,” says Wood. He adds that he is not so much worried about retaining staff given Lexington’s strong workplace culture and ethics, but rather about the ongoing ability to attract good people into the industry.
With so many hospitality companies suffering, and, in some cases, going bust, the perception of a career in catering has plummeted. “People have been massively put off, that has definitely damaged the future labour market,” says Wood.
Lexington is already endeavouring to engage with a new generation of industry recruits through its university graduate programme, which has four people signed up already this year. “I am really keen to do more of this and engage more with universities,” Wood says.
Meanwhile, the company is also heavily promoting its formal apprenticeship route, as well as its chef school, which continued to run virtually through the pandemic. “It is incredibly important to me as a leader during my first year here to make sure we really continue to focus on our people and push ahead with talent development and engagement,” Wood says.
Wood doesn’t need to resort to his crystal ball on this occasion to predict that 2022, while hopefully being a year of recovery, will nevertheless prove to be challenging. There are many things that need addressing, including finding new routes to market, either through technology or new approaches, to keep attracting the type of talent on which Lexington’s reputation was built. There is also the issue of aligning the company’s own corporate social responsibility and sustainability strategies to those of its clients, something that is certain to only become ever more demanding.
Despite these challenges, Wood describes himself as being “hugely excited” by his new post. “This is a business I have always admired, and I believe we have an opportunity for the great people who work for Lexington to really push the boundaries and stand out from our competitors.”
