He heads up the Irish arm of one of the biggest food services companies in the world. Frank Gleeson talks about securing Avoca and what’s next for Aramark in Ireland.
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Frank Gleeson (pictured), managing director of Aramark Ireland’s food services division, is a man with a demanding work diary – one that seldom gives him the chance to stop and smell the roses.
The first week of the new year would be as good a time as any for the hardworking former Topaz retail director to take stock on what can only be described as a stellar 12 months for the food, facilities and property services company he joined two years ago.
The icing on the cake for Gleeson arrived in November, when the Pratt family (owners the Avoca chain of retail outlets and cafes) agreed a deal to sell their business to Aramark Ireland’s US-listed parent, which employs more than 160,000 people in 22 countries, for a price rumoured to be upwards of €60 million.
Donal O’Brien, Ireland chief executive of Aramark, told The Irish Times at the time that the deal will finance an expansion of
Avoca while “mining valuable data about consumer trends from the Irish company for use around the wider Aramark group”.
It is expected that Avoca will operate independently within Aramark to protect the brand, while the latter will finance
an expansion in Ireland over the next two years, with the likes of Cork, Waterford and Limerick touted as probable locations, as well as a possible new Dublin city- centre flagship.
With Aramark’s considerable financial clout now behind the brand, the lucrative UK and east-coast US markets are also very much on the radar this year.
“This could be the first authentic Irish din- ing experience to be brought abroad. That will give huge opportunities for its artisanal suppliers,” said O’Brien in November.
Gleeson tells Hospitality Ireland that Aramark will look to garner useful insights from Avoca’s food business, which he expects will give Aramark Ireland fresh ideas for its corporate catering clients.
Plans are also being mooted about expanding Avoca’s event-catering arm, with rumours that the brand could be used for the event management of its new parent’s upscale clients.
“Avoca is a fantastic business,” says Gleeson. “We’ll be looking at bringing some of Avoca’s innovation into our food busi- ness, so it is going to be very interesting.
“Simon Pratt and his team have created a world-class business, so getting synergy and knowledge values will be important. I’ve got some deals spinning now on new franchises. We think we have something very unique and market-ready now, with some really innovative concepts coming [to market] very shortly,” he adds.
Gleeson, who is a former vice-president of retail for Statoil Ireland, operations director of the O’Briens off-licence group, and group sales manager for Xtra-vision, believes that a business like Aramark needs to become far more consumer and retail focused.
“That is really where the action is,” he says. “It is about being very lean in your operations and being very consumer- and employee-centric.”
The Avoca brand is one close to the heart of thousands of Irish consumers – something Gleeson is eager to protect.
“We’re not going to change it. We are going to grow it,” he reassures us.
“We bought it because we believe in it. It is, first and foremost, a destination brand that we won’t be looking to change. People see it as a lifestyle brand, with its shop, cafes, etc. We will give it the financial clout to allow it to grow apace. We do see the brand growing in Ireland for sure, but there’s massive opportunity in the UK and on the US east coast. This offer will travel.”
Figures
Meanwhile, accounts filed last August by Aramark Ireland Holdings and subsidiaries showed that the group recorded a 17% jump in operating profits, as revenues increased by 4.5%, rising from €223m to €233m.
The accounts registered that the group employs 4,061 people, and the vast majority of revenues were last year recorded in Ireland. According to the directors’ report, turnover has increased on foodservice and facilities management.
The firm increased its operating profits in spite of incurring €1.95m in costs arising from a restructuring programme.
The accounts show that 82%, or €190m, of revenues were recorded in Ireland, with 11% in the UK and 7% in other countries.
The directors’ report states, ‘Gross margin has decreased from 15.6% to 15.2%. The continued depressed economic climate and cost reductions sought by clients, combined with competitive pressures, has impacted on the gross profit margin.’
It adds that operating expenses as a per- centage of revenue have decreased from 13.4% to 12.7%. ‘Effective cost-control management has favourably impacted on operating expenses, and savings arising from the restructuring programme have favourably impacted on operating expenses.’
“We enjoyed a positive revenue year in 2015,” says Gleeson, who is also a former chair of Retail Ireland.
“It was a good retention year, too, signing a five-year contract with Diageo, while we also invested heavily in our employees.”
Gleeson points to Aramark Ireland’s employee advocacy initiative, GM 101, which provides managers with a programme that creates a consistent understanding of how Aramark grows the business, manages costs and productivity, leads people and meets its financial commitments, regardless of location or line of business.
“We are driving a customer-service culture,” he says. “We’ve also brought on board boxer Katie Taylor together with Munster rugby legend Alan Quinlan for Aramark’s Right Track Challenge, a campaign aimed at improving physical health and well-being in workplaces throughout Ireland.”
The 2015 accounts also showed that €141m of revenue was generated from food- service, with €82.74m generated from facili- ties management and €9m from property management.
In terms of where Aramark Ireland is making or not making its profit, Gleeson admits that the least profitable area last year was education, which he reveals has “gone through a bad period in terms of revenue”.
“The Guinness Storehouse and Croke Park both had fantastic years. There were almost 1.4 million visitors to the Guinness Storehouse, while Croke Park had another good one. We are running at a 96% reten- tion rate with our clients.”
Gleeson says that the Irish arm of the global Aramark family under Donal O’Brien has “come on tremendously” in recent years.
He reveals that Aramark Ireland has broadened its service range from being a food business to being a facilities- and property-management business. Effectively, it is now an integrated services provider for its clients in Ireland, and in some cases, they’ve chosen to give Aramark EMEA business, too.
“Our CEO looked at business four or five years ago, and asked, ‘What are our customers looking for?’ He found that they are looking for services.”
Consumer Tastes
In understanding changing Irish consumer needs as Ireland emerges out of recession, Gleeson uses millennials as an example.
He says that they’re well travelled and they want fast but fresh food, not just fast food.
“They are looking for quality food, freshly served, that has some health benefits, and that’s where we need to position our business. The biggest change I’m seeing world- wide is the general acceptance of all the different cultural food types.”
