US caterer feeds off opportunities on fringes of resources sector

A US company is growing its airport catering business as part of its continuing investment strategy for WA. 

US company Delaware North is investing close to $8 million to increase its activity at Perth Airport as part of an ongoing growth strategy in Western Australia.

The privately owned company is now the state’s fourth largest caterer, having increased staff numbers by 34 per cent in the last year.

According to Business News IQ data, Delaware North upped its staff numbers from 821 last year to 1,100 – moving it up one spot on the list of WA’s largest caterers.

 Overall, the company employs nearly 60,000 employees and has annual revenue of $US4 billion from its global hospitality operations.

The company’s national general manager of travel and hospitality, Brad Counsel, told Business News the increase in WA staff numbers was partly due to the addition of more outlets at the airport.

As well as traditional catering activity, Delaware North looks after airport outlets such as Dome.

The company now has 15 outlets across all airport terminals, with the $8 million investment to cover the cost of setting up a further six outlets.

“Airports are a core market for us and we’ve been in partnership with Perth Airport for close to 21 years, so it’s always been a major base for us in WA,” Mr Counsel said.

Delaware North operates in all of Australia’s major airports, apart from Canberra.

Other major venues in WA include the WACA Ground and the El Questro resort in the Kimberley. It also won the contract to provide catering services at Patersons Stadium from January next year over competitor Spotless, which previously held the contract.

Delaware North has so far resisted stepping into the mining sector, which has been a fiercely contested sector for many of Delaware North’s competitors in recent years, and the source of their growth.

Among the major players in this sector are ESS Support Services Worldwide, Sodexo Remote Sites Australia, ISS Facility Services and Morris Corporation.

“The mining game is very specific for those that do play in it,” Mr Counsel said.

“It is something that we’ve been invited to participate in over the years but we’ve stayed true to what our strengths are and what we do very well.”

Mr Counsel said competition for contracts in the airport market was increasing as activity in the mining sector plateaued, but he remained confident of retaining the position as the market leader in that space.

He said also said Delaware North hadn’t ruled out branching into servicing the resources sector, but conditions would have to be right.

“It’s not always about the financial return in the short term; it’s about what good looks like in the future,” Mr Counsel said.

He also said the slowdown in the mining sector had affected the company but WA was still a key focus for future growth.

“WA is still very strong and we’ve had some very strong years, but like most businesses in the last six months of last year it did start to plateau somewhat as the mining sector affects all of the economy,” Mr Counsel said.

“Other states haven’t had such strong growth but they are continuing to grow, especially the likes of Melbourne, which is growing, but nowhere near the rate that we’ve seen in WA over previous years.

“I think it’s all still pretty positive (in WA). Yes we’ve had a slowdown, but I think that was to be expected to a certain degree following the rapid rate of growth that we’ve had.”

The hardest challenge in supporting Delaware North’s growth was sourcing adequately trained staff, which Mr Counsel said could only be mitigated by creating a strong workplace culture.

“I think the (labour) market is improving, but in WA with the strong cafe and restaurant scene especially it’s difficult attracting the top-tier staff members of high calibre,” he said.

“It’s not just about pay, it’s about the environment that you create, so the environment we create and the culture within our business is very strong.

“That will lead to word of mouth with employees’ friends and family keen to participate in one of our venues.”