Airline Catering Giant Gate Gourmet Optimises Costs

If you have ever been on an airplane, there are many chances that you have tested some dishes prepared by Gate Gourmet. Founded in Switzerland in 1992, the multinational air and railway catering company, delights passengers flying with the main international airline companies in the world: Iberia, British Airways, Air Canada, Vueling or Easyjet just to name a few. The Spanish subsidiary, a public company for over 35 years, was managed by Iberia before becoming a partnership between Iberia and Gate Gourmet; it is managed since 2004 at 100% by Gate Gourmet and is, with 1,200 staff, the leader in the sector, controlling 65% of the national market. The Barcelona section, one of the most strategic, has, with the help of Expense Reduction Analysts, achieved significant savings and is undertaking improvement of their processes.

The Catalan Section of the business, located near the Prat de Llobregat airport, provides services to over 50,000 flights a year, half of the whole company, and serves 1,300,000 meals every year. This requires a huge effort in logistics to maintain facilities and vehicle fleet, as well as with cleaning and auxiliary tasks. Until recently, this was provided by a single supplier, a family business for which Gate Gourmet is the main client. For a multinational company such as Gate Gourmet, the dependence on a single supplier, especially with a high volume of transactions, is a risk they cannot take.

“In 2013, motivated by different projects of improvement and operational excellence in which Barcelona not only participates, but is a star pupil, we saw the need to professionalise the service and regain control over maintenance, and also to launch a tender” says Yolanda Escribano, Director of Gate Gourmet. 

The material to process was fragile. Maintenance and cleaning are very strategic categories in this sector and management feared that potential changes would be expensive. Besides, before taking any decision a comprehensive investigation of these cost categories had to be conducted and the company did not have either the resources or the time for that. “We realised that we would struggle to do this ourselves”, says Yolanda Escribano. The company decided therefore to trust Expense Reduction Analysts with the mission.

It was especially difficult to get an accurate picture of the situation in some categories.  The stoppages and breakdowns caused by poor maintenance can be more costly than the actual maintenance and this is not commonly associated when analysing the costs.

Cleaning is no less sensitive when talking about a company that deals with food and beverages which will be consumed at 10,000 metres. Airlines, clients and health authorities are putting pressure to do so.  “Few companies are forced to maintain a level of quality control as high as Gate Gourmet “, confirms Francisco Kornberger, Client Manager for the project.

Unique businesses, proven methodology

Today Escribano feels satisfied with the savings achieved, which reach 54% in auxiliary tasks but even more with the change in procedures. “What I like most is the methodology” she says. “All businesses think they are unique, and it’s true, but here comes Expense Reduction Analysts, and they use all their experience to show that the problem is not only yours, but that it occurs in other companies, and that it can be solved by applying a methodology that works. They have put us in contact with some very interesting businesses, with a philosophy similar to ours, and I think we will work together in the future. They have not only taken into consideration the cost reduction but also the culture of the company. “

It was possible to implement the plan very smoothly thanks to the involvement and collaboration of all parties.  A team created for the management of the Barcelona section; the areas of finances, procurement and operations in the company; and the consultancy analysts validated the different stages of the projects and managed the different challenges encountered.

The first phase consisted in analysing thousands of receipts on failure reports, work reports, spare part purchase and everything related to day to day maintenance, cleaning and auxiliary tasks. “This study gives us an exact radiography of the repeated issues and of customers’ requirements” explains Kornberger. As this was started from scratch though with a great wealth of information, it was possible to design a new work methodology. “We managed somehow to assemble all the puzzle pieces and put them together again with a better design than before” says Góngora.

A new mix of suppliers

For all the various services, we went from having one supplier to several in order to obtain an optimal mix both in terms of quality and costs. In some cases, it was possible to include providers who support employment for disadvantaged people. This was also possible with the auxiliary tasks provider. This was an important element to take into account as Gate Gourmet is a company very sensitive to policies for social corporate responsibilities. Finally, a provider specialised in food was chosen. “The change allowed the client not only to reduce costs, but also to improve efficiency”, concludes Góngora.

After optimising the suppliers mix, the third phase of the project was to provide the company with a methodology to assess services efficiently. On one hand, new IT tools designed to analyse the day to day maintenance were implemented, and also, on the other hand, a database was created for all facilities, which was parameterised in order to include all maintenance reports.

“Our goal was to provide the client with tools allowing to work in a more modern fashion,  with more quality indicators and more support to visualise the operation of services: a sort of window that enables you to quickly see the gears from the machine to quickly detect any fault and react in the most efficient manner” says Góngora.

It goes beyond that. “We lost our fear of change in a key service, I know that in the future if I need to make a change there are options on the market that will enable me to do so with the necessary precautions. I feel that Gate is now in control of the service” says Yolanda Escribano.

 

CATEGORYSAVINGS
Auxiliary tasks54%
Cleaning21%
Maintenance20%

DOWNLOAD THE CASE STUDY HERE (PDF)

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