Chartwells is able to buy its supplies in greater bulk than the school district can, because it provides food service to more than 500 school districts in the United States.
Constantine Public Schools, which serves more than 1500 students in southern Michigan, is partaking of the fruits of outsourcing. Constantine’s board of education decided recently to sign a contract for the district’s food services with Chartwells’ School Dining Services. At the time, Chartwells officials claimed they not only could save the school system an estimated $40,000 annually, but could offer better services to students.
One month after privatizing its food service, the district reports that the new service has served more meals, lowered labor costs, and reaped a $12,000 profit for the district. Chartwell’s says the school district has seen a daily increase of 116 meals served, with four fewer employees.
“We believe this was an opportunity. We wanted to take advantage of Chartwells’ purchasing power, better management, and increased student participation,” said Norman Taylor, superintendent of the school district.
One way Chartwells pleases is by providing students with an environment similar to dining out. “Some of our food stations are ‘Sandwich Central’ where subs are made to order just like Subway, ‘Menutainment’ where sandwich wraps or stir fry are made to order, ‘Trattoria’ where Italian foods are highlighted, ‘Garden Emporium’ for salads,” said Leikert.
Chartwells offers better services at lower prices because it is a private company with a bottom line. “Typically, when we are brought into a district we are under a microscope to perform qualitatively and financially,” stated Howard Leikert, regional vice president for Chartwells, “If we don’t perform as well or significantly better in these areas, we won’t be around.”
Chartwells is able to buy its supplies in greater bulk than the school district can, because it provides food service to more than 500 school districts in the United States. Chartwells estimated that Constantine schools alone would purchase $170, 000 worth of food annually. By contrast, Chartwells buys $40 million worth of food supplies in Michigan alone, and more than $1.5 billion nationwide — enabling it to charge less per unit of cost. “Just as important as a strong purchasing program is having other tools available that help to control costs — production records, inventory control, pricing guidelines, and financial reviews,” added Leikert.
Because the company can focus on just one task — food service — it is able to maximize meal and service quality as well. But perhaps the greatest benefit schools derive from privatizing food service is that it allows them to focus both their funding and their expertise on their most important task: teaching children.
James Hohman is a research assistant with the Mackinac Center for Public Policy.