Catering Outsourcing

Nowadays, business environments are no longer seen as stable and predictable because of economic globalisation, market maturity, technological change, the need to respond to the customers' increasing demands and fiercer competition. This means that the new competitive environment is more difficult to predict, which makes business management more complex. The UK economy is in danger of going into a double-dip recession because of the effects of government policy and a weakening of consumer confidence. Within a highly competitive operating environment, food and beverage businesses are once again faced with the need to maintain service and product quality while reducing their cost-base in order to minimize the effects of lower levels of demand and reduced consumer spending. Therefore, companies have to consider new ways of managing organisations. The need to respond to market changes on a daily basis and the difficulty of predicting the direction of such changes mean that organisations must focus on their core competences and capabilities. This leads to outsourcing in those areas that can be improved by specialist companies, in other words, turning to external sources to achieve the desired objective (Quinn and Hilmer, 1994). As a result, outsourcing has become a commonly adopted strategy in the hotel industry as managers attempt to compress operating costs in a tough business environment. "Outsourcing is one of the most important management ideas and practices of the past 75 years" (Bromage, 2000, p.23). The purpose of such a strategy is to improve productivity, increase revenues, cut operating costs, and reduce risks.

This paper is aiming at assessing the implications of outsourcing aspects of restaurant operations within the food and beverage sector. This paper gives an overview of outsourcing at first. In addition to highlighting both the possible advantages and disadvantages of adopting outsourcing strategy argued in relevant literature.