Is it a coincidence that the American investment banker who bought Gate
Gourmet is also the Chairman of Ryanair, a low-cost airline with no
in-flight catering?

Andy Hall wrote:
On Tue, 16 Aug 2005 09:48:41 +0100, "Dave Plowman (News)"
wrote:

In article ,
Capitol wrote:
The minimum wage acts( brought in
to increase tax take--do the sums) and excessive regulation and taxes
are slowly ensuring that low tech jobs are going offshore at an
increasing rate and that no sensible individual sets up a new
manufacturing business in the UK.

If someone really thinks they can't afford to pay 5 quid odd an hour, th=
en
their business isn't viable anyway. It's just not a living wage in any
part of this country. Unless they can supply free accommodation, etc.

This is the unfortunate aspect of this particular case. While I don't
support the strike action and the basis on which it is done, I do have
sympathy with their scenario of being on a low wage.

THe catering and hotel industries are poorly paid. Some hotels do
provide accomodation for some of the staff, some people working in
restaurants etc. do have the opportunity to earn tips. I suspect
that people in a catering firm like this don't have either
possibility.

However, it does come back to who pays. On airlines that I use that
have an economy class where nothing more than one soft drink is
provided and everything else is charged, very few people buy the
optional food such as sandwiches and salads etc. SAS, for example,
charges about =A34 for what would be around =A33.50 on the ground, so not
a huge price hike considering the extra handling involved.

When people have paid =A350 for a ticket, are they going to spend =A34-6
on food? It seems generally not.

Even in business class, most of the time the food is not that good,
and on the same pricing scale would probably be chargeable at no more
than =A310 or so in most cases. Added to this, on most flights, this is
a relatively small proportion of the seats these days.

So the reality is the the airline catering market has dramatically
shrunk. There is simply less demand for food in general and also the
potentially higher price and higher margin meals.

Clearly GG's business has not been viable at the staff and pay levels,
and business levels that they have been doing, which is why they have
been losing money. The airlines don't need the amount and level of
catering that they used to because the customer is unwilling to pay. I
agree that it's not reasonable to pay less than =A35 an hour, so it
isn't rocket science to figure out that the only way forward is to
reduce staff levels or hours worked. THe alternative is no company
and no staff, and that doesn't help anybody.


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