Sodexho Goes Commercial

FM Staff

Many contract management firms operate retail foodservices in healthcare environments. But Sodexho has embarked on a less-travelled road at the University of Alabama-Birmingham Medical Center (UABMC). At UABMC, Sodexho operates the North Pavilion Marketplace food court on a landlord/lease basis more typical of commercial restaurant operators.

The risk is all the company's, which built the five-concept eatery in a 25,000-sq.ft. space in the middle of the massive healthcare complex and operates it on a 100-percent p&l basis. It also pays the medical center rent and utilities charges.

"The challenge is in the different mindset for the foodservice management team," says Sodexho Regional Manager Jeff Berdis.

An estimated 30,000 employees, patients and visitors are onsite at UABMC at any given time during the day, giving the food court a large potential customer base. However, there is plenty of competition from UAB Hospital's own self-operated retail cafe, as well as street restaurants.

The food court includes licensed Chick-fil-A, Starbucks and Freshens Smoothies outlets as well as two of Sodexho Retail Brands Group's concepts, Pandini's and Charleston Market. In addition, there is an extensive grab-and-go section of salads, sandwiches and wraps.

Though the bulk of UABMC's in-house foodservice is self-operated, Sodexho does hold contracts for the employee cafeteria and for facility catering.

The genesis of the food court came about when the medical center embarked on a massive expansion, an 800,000-sq.ft. wing that encompassed 40 new operating rooms and 200 additional patient beds. The project created a 25,000-sq.ft. shell in the midst of the campus, so the center published an RFP soliciting bids to build and operate foodservices in the shell.

Berdis says it was senior vice president Jim Garland of UABMC who provided the vision to break out of the traditional operational mode and offer the space as a rental rather than simply as a managed operation. The move allowed the universe of bidders to increase and minimized the medical center's liability.

"It does not cost them a penny, but they get the rental and also annual charges based on customer count plateaus," he says.

The contract is for 10 years, with the rental fee increasing by the Consumer Price Index.

The hours are negotiable but the food court is required to operate seven days a week and during all dayparts. Currently, it is open from 6 a.m. to 8 p.m. Monday through Saturday and 6 a.m. to 3 p.m. Sundays. The Chick-fil-A is not open Sundays.

The space sees from 30,000 to 50,000 customers a week. Customer surveys indicate about a quarter are visitors to the facility and the bulk of the rest the 5,000 FTEs who work in the complex. Employees get a 15-percent discount after 4 p.m. each day.