Establishing a Canteen, Part 4: What Costs to Expect - And Is It Worth It?

Establishing a Canteen, Part 4: What Costs to Expect - And Is It Worth It?

We don’t know a single person that doesn’t like to eat. The same goes for many companies, and for exactly this reason they decide to offer their employees an added value by setting up a canteen. This way, no one needs to step out during their break and everyone can easily enjoy a warm meal together.

What are the pros?

Especially large companies are often located in industrial areas that offer very few (if any) attractive opportunities for lunch. This problem is often solved by creating your own solution on site.

In addition, the state supports this step with various tax benefits. The employer has the opportunity to grant a meal allowance, thus saving income tax and social security costs. Such benefits are tax-free for the employee as well, so that both sides benefit.

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How much does this benefit cost?

The "We Want A Canteen" project already starts with a huge, but one-time-only, cost factor: the renovation and set-up costs. Tens of thousands of euros have to be invested to make the room suitable for large kitchens. Numerous guidelines specify what needs to be taken into account - from tiled floors to space requirements, separate processing areas and waste disposal regulations.

Once this step is ticked off the list, it’s time for appliances. Commercial kitchen appliances are expensive, as well as the necessary counters, furniture and work materials.

Besides that, you will face the running costs every month. Goods and labor costs are the biggest factor, but in addition, electricity, water, gas and insurance need to be covered, quickly adding up to several thousand euros a month.

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What are the cons?

A canteen takes up a lot of space, which you might be able to use better for a different purpose. Space costs money and real estate is expensive - so perhaps it makes more sense to use the room for offices that generate valuable revenue for the company.

The cost of goods also plays an important role. In fact, the processing of fresh products is no longer economical these days, so it is recommended to resort to processed covenience products. While this is easy and cheap, freshness and quality suffer. This is also felt by the employees, who rarely enjoy potato salad from the bucket and mushy frozen meatballs.

If these two factors are acceptable for you, it remains to be borne in mind that the state regulates strict rules for gastronomic businesses. These must be adhered to at all times. A surprising visit from the health department can take place any time. If something goes wrong, it quickly gets expensive - or the canteen could even be shut down.

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The key question: Is it worth it?

Every company has to answer this question for themselves. Generally speaking, with an attractive offer in an unrivaled situation, a utilization factor of 50-70% can be expected. Another rule of thumb is that owning a canteen is not viable for smaller businesses whose participation rate would be less than 75 employees per day. Here it is advisable to find another solution.

What are the alternatives?

If you still want to offer your employees more than the P&J sandwich from home, you will find lots of modern alternatives. For example, in addition to the classic pizza service, small businesses like to use refrigerators that are provided by certain vendors and regularly restocked with snacks.

Starting from a couple of dozen people employees, it makes sense to seek a smarter and more versatile solution. Smunch replaces the offer of a traditional canteen almost identically, but without financial risk, effort or processed products. And you can simply use the space that the cafeteria would occupy on your premises for something different. For example, a ping-pong table. How about a match to burn off the meal?

No matter which solution you choose - we wish you bon appétit!

The Smunch Team