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Wednesday, June 17, 2009

KU has new food vendor for games

Centerplate signs 10-year concession contract

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Centerplate has a new contract to provide concessions at all Kansas Athletics events next season, replacing Mid-America Concessions, which had the contract since 1990.

Centerplate, a company with its executive offices in Connecticut, operates concessions for the Kansas City Chiefs, Kansas City T-Bones and Kansas City Wizards, along with many other professional and collegiate sports teams across the country.

“We consider ourselves a member of the community and we are thrilled to be extending our services to the university,” said Bob Pascal, Centerplate senior vice president for sales and marketing.

The contract covers concessions at all Kansas Athletics events, including football and basketball games.

The new 10-year agreement does not include a specific dollar amount; instead, Centerplate will pay a percentage of the net operating profits to KU, said Jim Marchiony, associate athletic director.

That percentage is still being determined, but will constitute at least a majority of the profits, he said.

Centerplate will also pay $1.1 million for improvements to concession facilities at several athletic complexes, including Allen Fieldhouse and Memorial Stadium.

While the company has made some proposals for food offerings that could be included, no final decisions have been made on what will be offered, Centerplate and KU officials said.

According to a Centerplate release, the company intends to introduce new menu concepts alongside traditional fare, paying homage to university athletic icons with concepts such as the Rock Chalk Grill and Phog’s Fieldhouse Favorites.

Mid-America Concessions employed 75 full- and part-time workers during the athletic season. The loss of the Kansas Athletics contract, which served as the main source of revenue for the company, means the company will shut down.

Pascal said Centerplate has named a new general manager for the area, and would be interviewing employees from Mid-America for new positions to determine whether they would be a good fit.

Centerplate has already been in contact with several nonprofit groups that worked concessions under Mid-America, and intends to include the groups as part of their operations, Marchiony said.

The groups, which include youth sports teams and other local groups, worked concessions as part of fundraising efforts.

“We do work with nonprofits and pride ourselves with our ability to do so,” Pascal said.

Comments

Deb Fitch 10 years, 11 months ago

I don't care who is in charge of concessions as long as Coke is there and not Pepsi!

chicagoeddie 10 years, 11 months ago

dude! please get some good food, ribs, good hot dogs - chicago style and real nachos!!!

rolo2383 10 years, 11 months ago

I'm not sure you can sell Pepsi at either AFH our Memorial b/c the university is all coke. I could be wrong. I just hope they sell and decent serving a nachos.

sevenyearhawk 10 years, 11 months ago

I have one simple request:

Nutrition / ingredient guides at the concession stands ...

My children have serious food allergies: Big Jay's is dairy, Baby Jay's is wheat and peanut.

I've heard lots of other folks concerned about this as well.

Thanks for the info, I'll start my campaign to contact them now ...

Waylon Cook 10 years, 11 months ago

This article was written an no real pot shots at Lew? Omg wheres Woodlings editorial on it next?

Martin Rosenblum 10 years, 11 months ago

I see all sorts of "..athletic icons and concepts" being introduced.

Mangino's Bucket-O-Hot Dogs

Xavier Henry's soft serve ice cream (eat it even after having your braces taken off)

Morris brother's Philly Cheese Steak

Mangino's Bucket-O-Wings

Bill Self's Deep Bench Pizza

Mangino's Bucket-O-Nachos

Lew Perkins National Championship Trophy Souvenier Pop Corn Cups

(and any other Mangino's Bucket-O- whatever they come up with!)

jayhawk2062 10 years, 11 months ago

FINALLY!!!!! No offense to Mid-America, but the concessions were pretty bad. Hopefully the quality will be better with a better value.

GO HAWKS!!! Just another step up to first-class. I will enjoy the games even MORE now.

100 10 years, 11 months ago

Just keep the smell of that fresh popcorn all throughout the rafters of Allen.

jaybate 10 years, 11 months ago

Oh, this is rich. Killing a local firm and getting 75 tax paying Kansas citizens fired in order to hire a Connecticut firm--where Lew used to live--and not even getting guarantied revenue increase, or guarantied cost saving, or at least not stating what it will be.

"The new 10-year agreement does not include a specific dollar amount; instead, Centerplate will pay a percentage of the net operating profits to KU, said Jim Marchiony, associate athletic director.

"That percentage is still being determined..."--LJW

Uh, yeah, that's a deal...

When Americans could still think, when they had not been lied to for so long by their leaders, when their jobs had not been outsourced for 20 years and their economy had not been brought to its knees by financial pirates, this sort of change might have caused a stir.

Now, it appears to be just another day in the political economy of outsourcing.

"Hey, youz guys over dere in Bramlage, yeah, youz guys, listen up. We already give dem punks in Kansas City and Lawrence offers dey could not refuse. Go along to get along, seez. Don't try to be wise guys eeder. Or we'll have Big Tony fly in from Newark and provides ya wit uh little encouragements. Our boys does the food in arenas now, see, or ESPN and our contractors axz like you bums don't exist, see? Its da system, pal. Don't fight it. You ain't in Kansas no more, Dottie."--Soldier Salvatore "The Frosted Malt" Rumplini

Naw, it couldn't be like that. Not really. No way.

The fact is there just isn't a firm in all of Kansas that could adequately provide a food concession service at a competitive price. Economies of scale, you know.

"...the Rock Chalk Grill and Phog’s Fieldhouse Favorites."

Whew, only a concessionaire from a really, really sophisticated place like Connecticut could come up with dem, er, those ideas. :-)

Comedy, all of the above is just comedy. Batta bing, batta boom!

frisbeenation 10 years, 11 months ago

I just want to keep getting Bum Steer at the Fieldhouse

Scott Lippoldt 10 years, 11 months ago

sevenyearhawk, I sooooo agree with you! Our son has a peanut allergy, and we have learned to read every single label. (For example, found gummy worms from a plant that processes peanuts.) We just keep praying that we don't have to use the epi-pen! Until you experience it as a parent, you have no idea how scary (i.e., life-threatening!) an allergy can be.

hollpat 10 years, 11 months ago

They had better keep the Coke products.. The rum that I sneak in the flask for BBall games will not mix as well with Pepsi.

kw11b2p 10 years, 11 months ago

No offense JAYBATE but you have no idea what your talking about. KU is not in the business, and yes it is a business, of forgoing potential revenues. The former provider to my knowledge had a contractual and flat amount that they had to pay. With the record setting increases in attendance at memorial stadium this agreement leaves millions that could be going to the University if only they had a contract that allowed them to take a percentage of the profits. The deal with centerplate will no doubt be a better deal for the University and allow it to make much needed improvements to existing athletic facilities. I understand your typical LAWRENCE attitude is to shun all newcomers and support, even when financially destructive, the locals......but in this case the economics is simply not on your side of the argument. Also, I understand your reaction to the 75 that will be let go, but seriously? 75 people? Like centerplate isn't going to need to hire any locals? You're really stretching there. The final employment outcome will probably be no jobs lost and no jobs created with millions in additional revenue to go to the university to increase facilities and provide what we in economics call PUBLIC GOODS. Something that Obama, who I'm sure your a fan of, is a big proponent.

finestack 10 years, 11 months ago

kw11b2p - Whistled for politicizing this! Non-shooting foul, only because I do have to give it to you, outsourcing is an undercurrent here. But come on, those of us business management types know that you never ever score a big sale (19 year KU athletics contract) and then rest on your laurels without spreading around that success and risk to other clients and services. This failed firm, mid-america, while somehow producing nachos my wife and former ku roommate would kill for, completely missed the rim on how to structure for long-term success. Shot clock violation, turnover to Lew's CT friends (for now). All's fair in business and sports.

Martin Rosenblum 10 years, 11 months ago

Maybe I'm being naive. But, if you know your child has allegies to certain foods, isn't it your responsibility and not a food concession company or a university's to safeguard their health? I'm sure that you wouldn't be prohibitted from bringing in appropriate snacks to a game, etc. under the circumstances.

I've read about airlines also being criticized for providing snacks containing peanut products, etc. Some have even caved in to the pressure.

Excuse me for having ascended my soapbox.

I know of people who are allergic to colognes and perfumes. Should there be a sniff test at the entrance to sports venues to weed out those who might cause an allergic reaction? What about those who are diabetic and can never find snacks and other foods that won't cause problems for them? Is there a responsibility to provide alternatives to anything and everything that may be of issue to certain groups of people in public places? Accomodations in public places have generally only been mandated through government involvement and legislation. This is evident by the recent slant to prohibit smoking in public places in many cities.

I do understand the concept of disclosing in writing the contents and ingredients of food and beverages. However, where would this end? Should they also disclose whether the cups, napkins and other paper products are made of recycled products? And, is it prudent for them to have to disclose their conpany's employment diversity statistics? These are issues that matter greatly to certain groups of people and could be issues that could prevent those people from consuming snacks from those vendors.

Let's put things into perspective and take personal responsibility.

jaybate 10 years, 11 months ago

kw11b2p,

Yours is a remarkably invalid argument and you are smug about it; this combination never ceases to amaze me.

kw11b2p 10 years, 11 months ago

I love the way you don't attempt to argue the validity of my comment, but simply call it smug. Maybe you could educate me beyond my years of economic studies as to how this deal is a lose situation for the University of Kansas. By the way, I must say I do enjoy and learn from your comments on KU sports...........so don't take it personally. We simply disagree about why the University made the decision..........MONEY.

kw11b2p 10 years, 11 months ago

I'll make one last post........THANK YOU FINESTACK AND MEMHAWK for having something that I tend to think is in short supply currently...........COMMON SENSE. I am a parent, and obviously find the idea that we should post ingredient listings on everything that is sold crazy. If you have a child that is sensitive to a certain item then by all means, you as a parent should prepare and take snacks with you. Do not even attempt to go to a sports event and then get angry with the food supplier that the complete chemical breakdown of every item sold at the game is not posted for all to see.........otherwise watch your precious hotdog go from $4 to about $8. I'm sorry your family has needs, but so do mine.......and paying $8 for a freakin hotdog is not one of them. CAN WE PLEASE USE COMMON SENSE AND STOP BEING SO NEEDY

Scott Lippoldt 10 years, 11 months ago

Memhawk and kw11b2p, Many venues will not allow a person to bring in snacks or drinks of any type--trust me, we've tried. While you may think it's all common sense or just easy taking personal responsibility, the fact of the matter is that many common (normal?) foods that one would assume should be safe often contain ingredients that are not. I guess if you've never been in an emergency room (and we have!) with a child who was in danger of dying from ingesting something that we assumed was safe--even after asking specifically about the ingredients--then you would not understand.

Many restaurants and chains now are providing nutrition/ingredient guides as a courtesy and safety precaution for their patrons, and it is not hurting them financially. As a parent who lives with this on a daily basis and knows of so many others with life-threatening allergies, I just feel having these guides would be a step in the right direction. Thus, while I respect your opinions, I could not more vehemently disagree.

Martin Rosenblum 10 years, 11 months ago

Thanks for respecting my opinions. I'm not one to wish harm to anyone. I guess there's sort of a generation gap here. Not meaning to sound like a grumpy grandpa, which I'm not at this point, but, peanut allergies, ADD, etc. are fairly recent phenomenons in society. With the introdction of new preservatives, substitutes and unpronouncable chemicals in our foods, more new allergies have been identified and have affected children more than adults. Thank goodness there are antidotes like the epi-pen. Recognition and diagnosis has made a significant difference in these areas. I still contend, however, that a person not assume that a food is safe. Do some research and alter the diet accordingly. If you know your child will peobably throw up if he/she rides a wild ride at a theme park, don't expect there to be a sign warning that the ride may cause vomitting! Just don't let them ride it! If you think there may be a risk of death from anything, just say no!

jaybate 10 years, 11 months ago

kw11b2p,

Hey, I never take things personally.

Let me give you a tip about how to argue things in public, or private, with anyone, on any subject. You don't begin by saying, "No offense, joe schmoe, but you have no idea what your talking about." Go read one of Gerry Spense's books, or one of Herb Cohen's books. Get some help on the art of persuasion. Your ideas won't ever get a fair listen, if you don't. I am going to work with you on this, because you are a fellow Jayhawk. I wouldn't if you weren't. Mostly persons just ignore persons who open their remarks the way you did. Persons who have actually had to work with other persons to solve problems and make things happen just tune out persons who start the way you did. Most people want to help get to yes, or at least examine issues, if they think they are dealing with other persons who are also trying to get somewhere constructive also. That lead in marks you as some one who is not.

So...

jaybate 10 years, 11 months ago

First, the old concessionaire probably would have been willing to do percentages and would almost certainly have been willing to meet or beat Centerplate's offer on percentages, because there is a depression on, because KU was its major client, and because not meeting the Centerplate offer meant it would go out of business. Firms will generally bend over backwards to avoid going out of business and in a depression they will jump through hoops if they have to. KU had much more bargaining leverage with the old concessionaire than it had (or will have) with Centerplate, especially being able to use the existence of Centerplate in bargaining with the old concessionaire to extract (pun intended) concessions. Even certain navel contemplative university business or economics professors buffered from Real Economik by tenure should grasp this sort of thing.

Second, Centerplate probably got the deal in no small part, because it would put up 1M bones for concession outlet rehab; this the old concessionaire could not match, because it was a small business set up just to provide concession food service, not to front and manage rehab of food facilities on the scale of expansion desired at AFH and Memorial Stadium. Centerplate does both apparently. Bully for Centerplate. It provides one stop shopping for Lew. But, of course, Centerplate is going to recover that money one way or another, out of the percentages. So KU is not going to make any more money by having Centerplate front it than it would have by KU fronting it and recovering it itself. Why? Well, the cost of that $1 Million of capital is undoubtedly going to have a higher interest rate attached to it with Centerplate fronting it than it would have had had KU fronted the money itself. Donations from alumni have no interest rates (aka meters) attached to them. Funds from the state typically have lower interest rates than private sector borrowing. And the probability is that Centerplate's business model tracks the recovery of this up front cost at the firm's internal rate of return on equity invested of 15-25% (or higher), whether or not they actually fund the cash out of operations, or borrow it from a respected lending institution (if there are any of those left after Bush and Paulson), or from, say, cousin Vinny's bank in Miami that is actually a front for laundering drug and black market arms money. There is still no free lunch in concessions, so to speak, even under Obama.

jaybate 10 years, 11 months ago

Third, by KU agreeing to the sizzle of the percentages game, KU is assuming that Centerplate can and will accurately account for all the revenues collected. Remember, in all business deals, one is buying assumptions. Having some past familiarity with food and booze concessions in regional malls and airports and restaurant chains and athletic facilities and so forth, I am, shall we say, not utterly sanguine about the prospects for highly accurate accounting by an East coast firm specializing in this sort of thing. :-)

Frankly, the only way Centerplate could have legally afforded to underbid significantly the old concessionaire was through the prosaic, but tried and true economies of scale in wholesale purchasing, which it might hold an advantage in given its larger size. However, the story makes no mention that Centerplate plans to pass those economies of scale on to KU, or to pass them onto fans by lowering their prices of refreshments at games. Do you think concessions will cost more, or less, after Centerplate takes over? :-)

The story only mentions expansion of concession outlets and implies doing more volume (it conspicuously does not mention if prices will go up) and so implies creating a bigger pie to divvy up by percentages. Frankly, KU may well be settling for a smaller percentage cut of the total pie than what it got in the old concessionaire relationship by fixed agreement, and may be doing so in hopes of it being from an enlarged pie; this is how the sizzle of these sorts of percentage deals are often hustled. Its a win-win Uncle Vinny.

jaybate 10 years, 11 months ago

Now let's look at the strategic problem KU is creating for itself by going this route. KU was a big dog dealing with a small dog in its old relationship. It could bully its previous concessionaire when it needed to; that is worth something in the day to day push and pull in business. The goal of every player is to have match-up advantage over an opponent. By going with Centerplate, KU has basically turned itself into one of many clients of Centerplate. When KU says jump, Centerplate does not have to say how high? When KU demands more detail on accounting and on what is happening in the concession business, Centerplate can afford to say, "We put you in the queue and we'll get to you as soon as we can." When KU threatens to change concessionaires, Centerplate can shrug, and say, sometimes ya gotta fire a client, instead of cutting their prices, or providing more service, or proving they are giving the real numbers.

There is also the risk of lying down with dogs and getting fleas, as my dear old mother used to say. The old concessionaire was a known factor, maybe not a great performer (who knows the actual story?), but a known. Centerplate may have a sterling reputation. I do not know. But guess wrong and do a few years of business with the wrong dog and you can pick up a lot of fleas, so many fleas that you hate to admit it and so just keep scratching rather than ever face up to the ugly prospect of having to get clean. I could point to Enron and AIG for emphasis here, but in this day and age there are literally thousands of these scummy organizations in every field to watch out for. Maybe Centerplate is a stellar organization. Maybe it is an upstanding corporate citizen. Or maybe it is like some food and beverage organizations with stellar reputations that also have ties to the mafia that lead one down the slippery slope of also being "asked" to use certain employee leasing firms, certain construction contractors, certain cement firms, and so on. There are slippery slopes in business, or are you naive enough to think there are not?

jaybate 10 years, 11 months ago

KU basketball, being an entity within a state-owned university has a lot of buffers from the cold cruel world of business. But even KU basketball has a series of contact points with that cold cruel world. Media is one. Facilities construction is another. Gaming is another. And food and beverage service is another. None of these businesses is known for being highly principled even on their good days. All of them have major players that have reputed underworld ties. Let's hope Lew still knows the players back east.

Given just the above issues, and there are many more, it is unwise for anyone related to KU basketball to reduce the analysis of how KU should best handle its food and beverage concession needs to a simplistic,and scantly supported, argument that KU may make a lot more money with Centerplate than with their old concessionaire. And KU could, also, have driven the creation of a new local concessionaire. The choice was not simply the old firm versus Centerplate.

But short-sighted assessment of the short term bottom line, coupled with naivety about business, financial and strategic market risks, are largely what put America in its current economic noose and allowed so many pirates to sack the country. I guess I should not be surprised that you appear so comfortable with the risk of putting KU and KU basketball in the same kind of noose with the same kind of thinking.

jaybate 10 years, 11 months ago

Now about economic effect to Lawrence and Kansas: there will probably be a net loss of managerial jobs for those jobs will be done in Connecticut, not in Kansas. Those are the highest paying jobs. But there will also likely be a pounding down of wages and benefits of those hired locally. Many large firms today are typically much more aggressive in pounding down wages and benefits than are small firms. Employee leasing is another onerous technique of cutting wages and benefits used by large firms more than small firms. Many large firms also tend to introduce automation that further reduces persons hired. And Centerplate is apt not to buy as much of its fiance and insurance services locally as the former concessionaire did. And Centerplate is apt not to buy as many of its food and beverage items and supplies from local suppliers as the former concessionaire. Losing 75 jobs has a significant ripple effect in the midst of an already brutal recession.

I think I have responded fairly to you on this. Things could be better with Centerplate, but there is also significant risk that things could be worse. And in any case, Centerplate imposes some job and supply outsourcing to Connecticut and elsewhere. All in all, hardly a win-win for Kansas and Lawrence, and well worth scrutiny regarding potential benefits for KU.

(End Note: the above is all opining. I do not mean to criticize, or praise, either Centerplate, or the prior concessionaire. And I do not claim to have any familiarity or first hand experience with either Centerplate, or the prior concessionaire, that would make me doubt, or have confidence in their ability and willingness to perform effectively and honorably. My comments are meant to apply generically and similarly to any firms of the size and kind represented by these two firms.)

Waylon Cook 10 years, 11 months ago

Pretty sure that the Chiefs, Royals and TBones use the same company did Lew make that happen too?

LOOK MID-AMERICA IF YOUR NOT GOING TO DO WHATS GOOD FOR US-WE WON'T DO WHATS GOOD FOR YOU.

I swear I can't wait to get a sign made for the back of my vehicles-share my work ethic not my wealth.

jayhawkintx73 10 years, 11 months ago

There was no validity to the argument. The only thing it was was "Political ranting". Notice Detroit. 1 million people left that city. Retailers are getting out. No major grocery store chains remain in Detroit. Not even one Chrysler dealer in the entire city is left. You know what caused that? Politics trumping common sense.

The new concessions company is going to have to hire local people in Lawrence. Not to mention, the new and upgraded facilities will attract more fans, now one thing is lacking for Memorial Stadium. More seating in the South End Zone. I saw the leather recliners, but that isn't enough if the program wants to be elite. A 2nd level on the North End Zone and a closing of the bowl on the South End. It would enhance the home field advantage and it would enable the new concessions to hire more than the 75 people who are going to lose their jobs. And these jobs were seasonal and part time mostly. Not full time.

number1jayhawker 10 years, 11 months ago

I think the new company will be good for KU and KU fans.

Now, how do I program this page to hide all of this jaybate person's blogs?

jaybate 10 years, 11 months ago

jayhawkintx73

Detroit is proof of one thing: it proves what happens when a private industrial oligopoly owns a town and runs every part of it. It ruins first the city and then itself.

Next, common sense without articulation of it through organized political movements is inert. Thomas Paine's Common Sense would have been irrelevant were it not the articulation of the intentions perceived by one man of an organized movement to overthrow a monarchy and replace it with a representative government.

jayhawk2062 10 years, 11 months ago

I'm guessing jaybate worked for mid-america with how boldly he is stating his convictions on here......

Note to jaybate........Centerplate is hiring.

Theutus 10 years, 11 months ago

Does anyone else see the irony in Jaybates post? Or "posts" i should say.

He starts off with "Let me give you a tip about how to argue things in public, or private, with anyone, on any subject. You don't begin by saying, "No offense, joe schmoe, but you have no idea what your talking about.""

Then he proceeds to do the same thing.... Basically talking down to people like they don't have any idea, and he is the all-knowing master.....

"Get some help on the art of persuasion. Your ideas won't ever get a fair listen, if you don't. "

Seems to me that Jaybate should heed his own advice.

David Robinett 10 years, 11 months ago

Gotta agree. Jaybate, you called kw11b2p sumg, then acted that way yourself.

None of us know the particulars of the deal or the true comparison, but I gotta go with kw11b2p 's business logic. I'm sure Lew is getting a better deal for KU. You may not like his salary, but I think he's earning every penny. Bottom line is winning, and it takes money to get there. KU athletics is making more money, and all programs are rising. We are now even funding the new Olympic Village for non-revenue sports - that's progress.

(questions about priorities of sports versus academics are a separate discussion - however, even Hemmenway became convinced that strong sports programs benefit the university as a whole. Wins = donations to the endowment association, higher student enrollment, etc. a seemingly virtuous cycle.

kw11b2p 10 years, 11 months ago

I love this site and the passion with which KU fans express themselves......it's one of the things that makes this University and community so great.

Kevin Long 10 years, 11 months ago

Jaybate--Really? I want to hear your thoughts, but man!

Michael Auchard 10 years, 11 months ago

With this much vitrol to the conversation, you'd think they were hiring John Calipari's Calimari Shack to run the concessions or something. Sheesh.

jchief40 10 years, 11 months ago

Jaybate is not a person - it is a group of people. Well obviously..

Martin Rosenblum 10 years, 11 months ago

I'm pretty sure Jaybate is not a group.

It only seems like it would take a group to be so prolific!

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