Large international events such as the Olympics provide massive opportunities to the food industry – from the chance to make opportunistic sales to milling spectators to beneficial exposure to global audiences, which can lead to potential export opportunities. Matthew Brace reports from Australia.
Australia is a good case study. As well as the successful Sydney Olympics in 2000, at about the same time Sydney was ranked as the world’s most popular international conference destination so multinational firms flocked to hold their AGMs within sight of the Harbour Bridge – all major catering and marketing openings. Now the country promises to offer similar chances for ambitious food companies next March, when Melbourne hosts the Commonwealth Games.
Individual food and catering companies approached by just-food would not reveal exact profits from particular events but they did shed some light on the importance of large events.
Fuel for athletes
British firm PKL Group – famous for organising the vast temporary restaurants at both the Sydney and Athens Olympics – has won a contract to supply and install all the foodservice equipment at the Athletes Village in Melbourne.
There will be two kitchens capable of feeding 8,500 athletes and officials, round the clock, for 25 days. The kitchen will be smaller than Sydney’s 20,000 square-metre giant but the deal is still lucrative for PKL.
PKL’s commercial director Peter Schad says working on the Olympics had dramatically increased PKL’s brand awareness, and he feels sure Melbourne would build on that success.
“International organisations have become aware of our brand and capabilities which is leading to further opportunities for us,” he says. “Large sporting events focus the world’s media not just on the athletes, but the legacy and facilities provided during the event. Though the majority of catering facilities are temporary, the standards are such that they would comply with permanent buildings.
“There is an increasing number of large events worldwide and all now expect Olympic-quality catering. This has created a market for first-class catering operators and equipment suppliers. There are no second chances at large events like these. Everything must be right first time.”
Schad will not reveal PKL’s turnover or profitability of individual projects but he does say that “such projects are more economically viable for PKL because Olympic events allow us to invest in large amounts of foodservice equipment”. He continues: “This then gives us the availability for other events in the UK and abroad without the need for additional capital expenditure.”
Boon for local producers
Conference and venue contract awards are also well worth watching. Take the three Commonwealth Games contracts won by the Melbourne Exhibition and Convention Centre (MECC). In 2003, the MECC had a useful dress rehearsal, hosting the 19th International Congress of Genetics, which attracted 2,742 delegates and 120 journalists from around the world. The MECC tells just-food the congress organisers spent a quarter of their event budget on catering.
In a country such as Australia, where there are abundant supplies of food, this can prove a boon for the local food manufacturing industry. An MECC spokesman stressed this depends on the country’s location, climate and food production capacity. Caterers working on big events in Australia, for example, have can source almost all their food and beverages locally, with the country’s size and climactic variety meaning throughout most of the year event organisers can source mangos from north Queensland, stone fruit from South Australia, lobsters from the west coast and herbs, saffron and even truffles from Tasmania.
However, for events in smaller countries, such as New Zealand, the need to import is likely. For an event on the scale of the Olympics, demand is vast. Schad says at the 2000 event, more than two million meals were served in the athletes’ village; there was 400m of serving counters – enough to stretch around the Olympic track; more than 630,000 bananas were eaten in the athletes’ village; more than 600 catering staff were on duty during peak meal sessions; and more than 1,500 menu recipes were created for the Games.
Too excited to eat?
That said, there can be a less positive knock-on effect during mass spectacles such as the Olympics and Commonwealth Games, where consumers are so interested in sporting or other performances, they spend less on food generally, especially eating out.
A survey conducted by the industry body Restaurant and Catering Australia found that “there was a very significant dip in business for both restaurants and caterers during the 2000 Sydney Games”. It “had a marked negative impact on the restaurant and catering business across the country,” said the report. “The overall negative impact (over the 16 days of the Games) was a 12.1% downturn in business.”
The organisation’s CEO, John Hart, says he expects a similar scenario in Melbourne next year. “Unfortunately the premise that the hospitality business will boom during such events is incorrect,” he says, stressing that food contractors would be best served sharing staff, so there was not a shortage at an event, whilst there was under-utilised labour in other businesses.