By Brad Dorfman
CHICAGO (Reuters) - Retirees and students are two key customer groups that food service and facilities management company Aramark Corp. RMK.N expects to drive growth in its business, a company official said on Wednesday.
Aramark currently reaps 28 to 30 cents in revenue for each $1 college students spend on campuses where it operates, Andrew Kerin, president of Aramark's Health Care and Education businesses, said at the Reuters Food Summit in Chicago.
"We've got 70 cents of untapped opportunity for us to figure out what else they want, where they want it, how they want it, when they want it," Kerin said.
To do that, Aramark is expanding past the traditional college meal plan model of a cafeteria where a student eats three meals a day.
For example, at the University of North Carolina in Chapel Hill, the company operates a sports bar. The company also operates convenience stores and other venues at other colleges.
The company is also seeing a push for healthier products, including organic foods, vegan and vegetarian options.
Students are also willing to pay for higher-end options, including healthier items, a trend the company sees in high schools.
"It's amazing to me and to us the disposable income of a high school student," Kerin said.
Older people are also living more in a form of "campus" environment, with the growth of continuous care retirement facilities, Kerin said.
These living areas are different than assisted living facilities and other venues where seniors receive health care along with a place to live, Kerin said. The retirement units cost $150,000 to $500,000 each and the residents are active, with disposable income, and want customized food.
"In many ways if you see some of these places, they look like a college campus and the only difference is about 60 years" in the age of the clientele served, Kerin said.
Aramark operates in 19 countries and could expand further. The company looks for countries with a high gross domestic product and population, he said, adding that about 15 percent to 25 percent of the company's revenue currently comes from abroad.
Aramark shares closed up 11 cents at $28.46 on Wednesday on the New York Stock Exchange. The stock trades at about 17 times estimated 2006 earnings, compared with a multiple of 20.5 for the Dow Jones U.S. Restaurant and Bars index .
© Thomson Reuters 2009. All rights reserved.
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