Leader in the airline sector, LSG to star in schools and stores
Valor Econômico 09/06/10
The largest catering company in the world, LSG Skychefs, will adopt in Brazil a successful strategy of the sector in Europe and in the United States. Controlled by the German Lufthansa, it intends to broaden its range of operation as it plans that up to 30% of its earnings be generated by catering to schools, hospitals and convenience stores, within at least five years. Negotiations to that end are already underway.Currently, 70% of the earnings of LSG come from airplane meals. The supply of biodegradable trays developed from sugarcane bagasse, and the washing of the dishes used in aircrafts, among other services, account for the other 30%. The company will also invest up to US$ 18 million to increase its production in three of the eight units it has in the country, always near airports. It is the largest operation of LSG in Latin America.
"The sector has gone through several difficult phases. In five years, three large companies (Varig, Vasp and Transbrasil) went bankrupt and there was the rise of the companies that offer lower costs and fares", says the Regional Director of LSG for Latin America, Paulo Teixeira. Only between 2002 and 2003, five catering companies closed their doors and 4 thousand people were laid off because of the air crisis and the replacement of the meals for cereal bars.
The investment plan of LSG in Brazil stipulates up to US$ 10 million in works for the enlargement of the Guarulhos unit. Another US$ 5 million are foreseen for Salvador (Bahia). And other US$ 3 million may be invested in Campinas, in the International Airport of Viracopos, where there is an operation for the putting up of meals that are supplied by the production line of Guarulhos, the largest in the country. Teixeira tells he intends to open another five production units in Brazil. Acquisitions for the execution of that plan have not been ruled out. The company is the leader in the Brazilian market, with a share of 40%, nearly 850 employees, 60 thousand meals a day in 400 flights for 30 airlines, between Brazil and abroad. Only the unit if Guarulhos is responsible for nearly 50% of the operation of LSG in Brazil. 30 thousand meals a day are produced there to cater to 250 flights. This production line works 24 hours with three shifts.
The Brazilian market of in-flight meals annually generates, on average, nearly R$ 350 million (US$ 200 million), according to Teixeira. In 2010, the growth of the sector may reach 8%. LSG, on its turn, has the chance to increase its earnings in up to 15% over the same period of time.