7 ms·

I can't believe how every time this topic comes up, cutting free food for the employees is a talking point. Providing basic necessities (food, transportation, n

by GuiA 11y ago

I can't believe how every time this topic comes up, cutting free food for the employees is a talking point. Providing basic necessities (food, transportation, non crowded offices, sick days, etc.) to make sure your employees are happy and productive seems to me like step 0 of any successful business venture. Of course don't serve them caviar and foie gras, but I really don't get why everyone seems to think that cutting a basic cafeteria is a vital piece of any "let's put the company back in the green" plan. Well I do get why so many finance people think that way, it just makes me sad that they're the ones calling the shots.

charlesdm 11y ago
It's very much part of the private equity playbook. I read in a PE deck once that they saved nearly a million a year during restructuring by swapping out organic chicken in the cafeteria with regular chicken
ars 11y ago
It's because the article says they spent $108 million on food per year. That works out to $38 per person per day. That's a LOT. It should be maybe 1/10 that considering that not everyone will eat the food every day.
- gist 11y ago
  Agree. But I am sure it wasn't "lunch lady land" food but instead prepared with the utmost of care by a private chef who had serious chops to create "healthy" meals. This probably wasn't (wild guess?) local school district fare.
- 1123581321 11y ago
  Google supposedly spends between $20 and $30 a day.* Those numbers are from several years ago, so it's plausible that Yahoo needs to pay more per employee now. There are certainly ways to do cheaper foodservice, but probably not many ways to do Google/SV-quality free employee food for much less. * http://www.businessinsider.com/yahoos-free-food-budget-5000-per-employee-20-million-per-year-2012-7 http://www.businessinsider.com/yahoos-free-food-budget-5000-... * http://www.businessinsider.com/2008/4/googles-ginormous-food-budget-7530-per-googler http://www.businessinsider.com/2008/4/googles-ginormous-food...
  - trhway 11y ago
    >not many ways to do Google/SV-quality free employee food for much less may be they brought me into a wrong cafeteria :) - when i went for an interview at Google, the food was so-so, and in no way beating a $10 lunch at a typical commercial place (and even less so a $20 lunch at a restaurant). A colleague of mine went there recently for some business meeting - the same impression about the food.
    - asb 11y ago
      Sure, but that doesn't tell you anything about the cost to Google of providing that food, including at unpopular times etc.
    - deelowe 11y ago
      Google serves 3 meals a day. Most just eat lunch, a good bit eat breakfast, and dinner is the least attended. That said, there are still lines for every meal.
- sirkneeland 11y ago
  Those numbers seem high given that I personally spend $20 a day on food for all meals (whereas corporate meals are probably covering 1.5 meals per day) and don't get much by way of economies of scale (despite my most valiant Costco efforts).
  - cgh 11y ago
    Are you paying people to cook your food and clean your dishes for you?
    - jasonlotito 11y ago
      Not the person you are asking, but I can answer yes to that at the same price point, and we are talking about cheap fast food either. $25+ for a meal is not cheap.
- interesting_att 11y ago
  We have no idea if the food estimate is correct. The article mentions that many people in Yahoo interviewed by the reporter think the investor's numbers are widely off. My guess the $108m includes other things than just food.
- lesdeuxmagots 11y ago
  That's breakfast, lunch, and probably 5% dinner (a small minority of HQ), including cleanup costs (washing dishes, etc). You have to have some over-capacity as its a cafeteria - you can't run out of food at any time, so throw in an extra 10% - 20% food. Then add in snacks and drinks, which come out to a few dollars a day per employee, including stocking costs, running the coffee bars, etc. That's a few drinks from the fridge, a coffee or two, a few bags of snacks a day. And I don't know anyone working at any SV tech headquarters who don't eat the food every day. Personally I've maybe eaten not at work for breakfast and lunch...10 work days in the past year? While the HQ gets economies of scale, smaller offices are more expensive. Y! SF catered for a long time before finally also switching over to Bon Appetit. Y! NYC provided a daily seamless stipend before they finally built out the in-house dining area. Add in non-full time contractors as well, who generally get the eat at the cafeteria as well. Bon Appetit is a standard, albeit higher end, food services company. They serve colleges as diverse as Cornell, Oberlin, the College of Idaho, Lewis and Clark, etc. It's the same company used by Google, Oracle, and eBay. It's hard to describe them as over-priced and overly-luxurious.
gist 11y ago
"but I really don't get why everyone seems to think that cutting a basic cafeteria" Providing a cafeteria is fine however not charging for the food in the cafeteria is another thing. It's seen as excess when things aren't going well. It's ignored or possibly thought of positively when things are going well. A similar but different example is private jets. Always get chopped when things are bad. But they have value for sure. Executive time is important and it's not just the luxury as is often thought by outsiders. It doesn't take free food to make employees happy and productive if they are already earning good salaries.
- sokoloff 11y ago
  But it does tend to keep people on campus and socializing with each other if it's a) good and b) free.
- FireBeyond 11y ago
  Executive jets only make sense for short-notice travel. Hell, even NBA teams have cut down, and all or almost all of them now fly chartered airline (mostly Delta). Same 'red carpet' experience though not all the luxury and trappings, and this is for a group of people typically making between the group $100-200M a year.
  - deelowe 11y ago
    Corporate jets don't cost > $100M per year.
    - FireBeyond 11y ago
      Never said they did. I meant when you categorize "CEO of household name company making 8 digit salary" with "group of world leading athletes making 8 digit salary", and in these days, the latter group (who arguably is going to have the biggest issue with ego) is okay with a Delta chartered 757 for the team, but a CEO who is losing money hand-over-fist absolutely has to be in a new Gulfstream V... The only difference is the need for a corporate jet is short-notice travel (in which case, there are cheaper options than outright ownership), versus the major league team's more scheduled transit.
mikeash 11y ago
It's OK to give the plebes some scraps from the table when profits are rolling in, but when the business is in trouble, they need to suffer too. Regardless of whether it's material to profitability, it's just not right for the common folk to be eating while the poor CxOs and fund managers might lose millions.
derekp7 11y ago
I personally like to use the free food or sodas as a canary. When the company isn't doing too good, those are the first perks to get cut, because it looks good -- however it doesn't really rescue a failing company. So as soon as the free soda dries up, it is time to put out your resume.
- TheOtherHobbes 11y ago
  But you'd expect a CEO to be able to hire someone to negotiate the cost down. $38 a day per person for what should be a company-wide catering concession is unusually generous. Meyer generally seems to have made some hard-to-justify spending decisions. She won't be the first or last CEO to go on a spending spree - see also Autonomy, etc. But the usual idea is to get some value from the shopping trips. If that's not happening, it's a strong signal that the CEO isn't shopping with clue. I think the board could have been much more critical of the Polyvore deal in particular.
crdoconnor 11y ago
This kind of thing is par for the course from private equity. I'm surprised they only suggested firing 3/4 of the staff and they didn't suggest outsourcing everything to the lowest cost body shop in Bangalore. PE is all about giving a temporary boost to stock price and cashing in quickly before the long term damage becomes apparent, mixed in with a healthy disdain for the people who do all the actual work.
Shivetya 11y ago
well I have experienced new management whose first item at hand was to insult everyone already there. from telling them they will be made in a world class organization to stating on a five point scale everyone is a two unless they prove otherwise, a two being "performing less than expectations". It ain't just finance people
Fomite 11y ago
"any successful business venture" There are a vast number of successful companies, ones who actually turn a profit, who don't provide either food or transport to their employees.
marshray 11y ago
It's nice to have a company cafeteria. It doesn't matter to me if the company is paying for the food or if I'm charged market prices. However, if the company is paying for the food it's presumably with pre-tax dollars for the both of us.
MR4D 11y ago
Two of the most successful companies on the planet (Apple & Exxon) don't have free food. There is nothing wrong with charging say $5 for a (subsidized) meal. It cuts down waste and communicates to employees that the company is working to reduce your costs, and also that they want you to make good decisions (not waste food). It's only two examples, but I think it's more than a coincidence. Also, those two companies seem to have more stable workplaces for employees. Yahoo seems to be a mess over the past decade.
- foobarian 11y ago
  I don't really care if they charge for it or not, as long as it's easy and available on the premises. Going out for lunch is annoying and inefficient.
zzalpha 11y ago
Providing basic necessities (food, transportation, non crowded offices, sick days, etc.) to make sure your employees are happy and productive seems to me like step 0 of any successful business venture. Wut? Providing employees with pay commensurate with the market and their abilities is step 0. They can buy their own damn food. Is this really the level of entitlement people have now? Because it's pretty impressive... I mean, why stop at just food and transportation? If employers need to provide "basic necessities" to be a "successful business venture", why not include dormitories? Free clothing? Healthcare services?

by GuiA 11y ago

charlesdm 11y ago

It's very much part of the private equity playbook. I read in a PE deck once that they saved nearly a million a year during restructuring by swapping out organic chicken in the cafeteria with regular chicken

ars 11y ago

It's because the article says they spent $108 million on food per year. That works out to $38 per person per day. That's a LOT. It should be maybe 1/10 that considering that not everyone will eat the food every day.

gist 11y ago
Agree. But I am sure it wasn't "lunch lady land" food but instead prepared with the utmost of care by a private chef who had serious chops to create "healthy" meals. This probably wasn't (wild guess?) local school district fare.
1123581321 11y ago
Google supposedly spends between $20 and $30 a day.* Those numbers are from several years ago, so it's plausible that Yahoo needs to pay more per employee now. There are certainly ways to do cheaper foodservice, but probably not many ways to do Google/SV-quality free employee food for much less. * http://www.businessinsider.com/yahoos-free-food-budget-5000-per-employee-20-million-per-year-2012-7 http://www.businessinsider.com/yahoos-free-food-budget-5000-... * http://www.businessinsider.com/2008/4/googles-ginormous-food-budget-7530-per-googler http://www.businessinsider.com/2008/4/googles-ginormous-food...
- trhway 11y ago
  >not many ways to do Google/SV-quality free employee food for much less may be they brought me into a wrong cafeteria :) - when i went for an interview at Google, the food was so-so, and in no way beating a $10 lunch at a typical commercial place (and even less so a $20 lunch at a restaurant). A colleague of mine went there recently for some business meeting - the same impression about the food.
  - asb 11y ago
    Sure, but that doesn't tell you anything about the cost to Google of providing that food, including at unpopular times etc.
  - deelowe 11y ago
    Google serves 3 meals a day. Most just eat lunch, a good bit eat breakfast, and dinner is the least attended. That said, there are still lines for every meal.
sirkneeland 11y ago
Those numbers seem high given that I personally spend $20 a day on food for all meals (whereas corporate meals are probably covering 1.5 meals per day) and don't get much by way of economies of scale (despite my most valiant Costco efforts).
- cgh 11y ago
  Are you paying people to cook your food and clean your dishes for you?
  - jasonlotito 11y ago
    Not the person you are asking, but I can answer yes to that at the same price point, and we are talking about cheap fast food either. $25+ for a meal is not cheap.
interesting_att 11y ago
We have no idea if the food estimate is correct. The article mentions that many people in Yahoo interviewed by the reporter think the investor's numbers are widely off. My guess the $108m includes other things than just food.
lesdeuxmagots 11y ago
That's breakfast, lunch, and probably 5% dinner (a small minority of HQ), including cleanup costs (washing dishes, etc). You have to have some over-capacity as its a cafeteria - you can't run out of food at any time, so throw in an extra 10% - 20% food. Then add in snacks and drinks, which come out to a few dollars a day per employee, including stocking costs, running the coffee bars, etc. That's a few drinks from the fridge, a coffee or two, a few bags of snacks a day. And I don't know anyone working at any SV tech headquarters who don't eat the food every day. Personally I've maybe eaten not at work for breakfast and lunch...10 work days in the past year? While the HQ gets economies of scale, smaller offices are more expensive. Y! SF catered for a long time before finally also switching over to Bon Appetit. Y! NYC provided a daily seamless stipend before they finally built out the in-house dining area. Add in non-full time contractors as well, who generally get the eat at the cafeteria as well. Bon Appetit is a standard, albeit higher end, food services company. They serve colleges as diverse as Cornell, Oberlin, the College of Idaho, Lewis and Clark, etc. It's the same company used by Google, Oracle, and eBay. It's hard to describe them as over-priced and overly-luxurious.

gist 11y ago

"but I really don't get why everyone seems to think that cutting a basic cafeteria" Providing a cafeteria is fine however not charging for the food in the cafeteria is another thing. It's seen as excess when things aren't going well. It's ignored or possibly thought of positively when things are going well. A similar but different example is private jets. Always get chopped when things are bad. But they have value for sure. Executive time is important and it's not just the luxury as is often thought by outsiders. It doesn't take free food to make employees happy and productive if they are already earning good salaries.

sokoloff 11y ago
But it does tend to keep people on campus and socializing with each other if it's a) good and b) free.
FireBeyond 11y ago
Executive jets only make sense for short-notice travel. Hell, even NBA teams have cut down, and all or almost all of them now fly chartered airline (mostly Delta). Same 'red carpet' experience though not all the luxury and trappings, and this is for a group of people typically making between the group $100-200M a year.
- deelowe 11y ago
  Corporate jets don't cost > $100M per year.
  - FireBeyond 11y ago
    Never said they did. I meant when you categorize "CEO of household name company making 8 digit salary" with "group of world leading athletes making 8 digit salary", and in these days, the latter group (who arguably is going to have the biggest issue with ego) is okay with a Delta chartered 757 for the team, but a CEO who is losing money hand-over-fist absolutely has to be in a new Gulfstream V... The only difference is the need for a corporate jet is short-notice travel (in which case, there are cheaper options than outright ownership), versus the major league team's more scheduled transit.

mikeash 11y ago

It's OK to give the plebes some scraps from the table when profits are rolling in, but when the business is in trouble, they need to suffer too. Regardless of whether it's material to profitability, it's just not right for the common folk to be eating while the poor CxOs and fund managers might lose millions.

derekp7 11y ago

I personally like to use the free food or sodas as a canary. When the company isn't doing too good, those are the first perks to get cut, because it looks good -- however it doesn't really rescue a failing company. So as soon as the free soda dries up, it is time to put out your resume.

TheOtherHobbes 11y ago
But you'd expect a CEO to be able to hire someone to negotiate the cost down. $38 a day per person for what should be a company-wide catering concession is unusually generous. Meyer generally seems to have made some hard-to-justify spending decisions. She won't be the first or last CEO to go on a spending spree - see also Autonomy, etc. But the usual idea is to get some value from the shopping trips. If that's not happening, it's a strong signal that the CEO isn't shopping with clue. I think the board could have been much more critical of the Polyvore deal in particular.

crdoconnor 11y ago

This kind of thing is par for the course from private equity. I'm surprised they only suggested firing 3/4 of the staff and they didn't suggest outsourcing everything to the lowest cost body shop in Bangalore. PE is all about giving a temporary boost to stock price and cashing in quickly before the long term damage becomes apparent, mixed in with a healthy disdain for the people who do all the actual work.

Shivetya 11y ago

well I have experienced new management whose first item at hand was to insult everyone already there. from telling them they will be made in a world class organization to stating on a five point scale everyone is a two unless they prove otherwise, a two being "performing less than expectations". It ain't just finance people

Fomite 11y ago

"any successful business venture" There are a vast number of successful companies, ones who actually turn a profit, who don't provide either food or transport to their employees.

marshray 11y ago

It's nice to have a company cafeteria. It doesn't matter to me if the company is paying for the food or if I'm charged market prices. However, if the company is paying for the food it's presumably with pre-tax dollars for the both of us.

MR4D 11y ago

Two of the most successful companies on the planet (Apple & Exxon) don't have free food. There is nothing wrong with charging say $5 for a (subsidized) meal. It cuts down waste and communicates to employees that the company is working to reduce your costs, and also that they want you to make good decisions (not waste food). It's only two examples, but I think it's more than a coincidence. Also, those two companies seem to have more stable workplaces for employees. Yahoo seems to be a mess over the past decade.

foobarian 11y ago
I don't really care if they charge for it or not, as long as it's easy and available on the premises. Going out for lunch is annoying and inefficient.

zzalpha 11y ago

Providing basic necessities (food, transportation, non crowded offices, sick days, etc.) to make sure your employees are happy and productive seems to me like step 0 of any successful business venture. Wut? Providing employees with pay commensurate with the market and their abilities is step 0. They can buy their own damn food. Is this really the level of entitlement people have now? Because it's pretty impressive... I mean, why stop at just food and transportation? If employers need to provide "basic necessities" to be a "successful business venture", why not include dormitories? Free clothing? Healthcare services?