The Latest Challenges and Trends in Onboard Product Sourcing

The Latest Challenges and Trends in Onboard Product Sourcing

Like supply chains, product sourcing and procurement for onboard suppliers has recently been affected by a number of factors including labour and skills shortages.

To better understand the current state of onboard sourcing, the WTCE team spoke to experts from LSG Group and Panoramic Gourmet to offer insight on the issues.

Who are LSG Group?

The LSG Group is the quality and technology leader in airline catering and onboard services, with multiple brands under its umbrella. 

In 2013 it fully acquired Retail inMotion, specialists in the implementation of onboard retail programs covering proprietary inflight technology, as well as the procurement and distribution of buy-on-board products, concepts and crew training.

To understand the current challenges of travel catering product sourcing, WTCE spoke to Benjamin Kammer, Senior Category Manager for Food, Beverage and Retail at Retail inMotion. He explained:for the procurement department at Retail inMotion, the key task at hand is to source innovative products for its airline customers.” 

“The team at Retail inMotion discovers new products and suppliers through its network of colleagues who are well-versed in detecting on-trend items that can be sampled and followed up accordingly.”

Who are Panoramic Gourmet?

Tim Uebersax is CEO of Panoramic Gourmet plc. and a former Taste of Travel Theatre speaker. He has spoken on a panel about ‘The Challenges of Growing Sustainable International Rail Catering in Europe’, about developing onboard customer hospitality while complying with evolving requirements. 

In his own words, “Panoramic Gourmet plc. is the caterer of the world-famous Glacier Express, the Rhaetian Railway, and the Matterhorn Gotthard Railway dining cars.” The railways cover the regions of Graubünden, the canton of Uri and the Oberalp Pass near the source of the Rhine.

With the need of both to provide products across a range of categories for multiple carriers/operators, product sourcing relies on strong logistics and communication.  

Logistics and communication

It’s no surprise then, that Ubersax states: “the biggest challenges are logistical.” 

Supplying onboard catering to three unique railway operators requires him to balance rigorous processes with the need to be flexible to meet changing demands.

The same is true for Kammer, who states that there is no such thing as a typical day in the life of a buyer for onboard services. Though there are subjects that regularly come up. For example:

  • ongoing sourcing tenders involving hundreds of product SKUs
  • negotiating cost prices and marketing deals with suppliers
  • supporting operational issues
  • adapting or optimising processes with airlines
  • and managing internal initiatives or specific airline requests

These are all part of daily life for the Retail inMotion procurement team.

Some of these subjects ring true across the whole of the onboard industry. Ubersax, for example, is also no stranger to optimising processes. 

“In Chur, at the Panoramic Gourmet site, all trains are loaded in all directions. This has to be planned very meticulously because we don’t have any other logistical possibilities in the Alpine environment.”

Swiss alpine railway

However, meticulous planning equally relies on strong communication for these companies to remain agile.  “Communication among the companies is ensured through various “communication vessels” such as weekly and monthly meetings, as well as daily exchanges with our operational staff are crucial for a successful daily routine.”

It’s no surprise then that the Retail inMotion team also holds dedicated briefings with each and every airline customer at the start of each cycle.

This helps to ensure the procurement team is listening to their individual needs before making use of the different sources in place to find the according items.

These range from targeted market resources and trend scouting to exchange with market-leading research institutes. LSG and Retail inMotion take a dedicated approach when it comes to relationships with airlines.

Much like Uebersax with each of the three Alpine railways serviced, Kammer states that each of his customers has an individual account manager managing the customer relationship in daily business. 

“At Retail inMotion, we always try to maintain an honest and reliable relationship with our potential suppliers as we’re only able to create those unique customer experiences if we have something which is genuinely reliable and offers value to passengers.”

Subsequently, to supply these products and passenger experiences in environments with high volumes, low margins, and tight turnarounds, people power is required. But onboard people and product procurement is an area which has been hit hard in recent years.  

Onboard talent sourcing

Simply put, says Uebersax, “the labour market is coming to a head”. 

Speaking of the work involved, he continues with, “it is very challenging to find the necessary number of well-trained employees who are willing to do such a job (irregular working hours, overnight stays away from home, alpine altitude differences, etc.).”

Indeed, Federica Catani, Director of Scuola Nazionale Trasporti e Logistica, recently stated that the issue can be seen “both as a quantitative and qualitative one”.

For Panoramic Gourmet, “the rolling catering company also employs up to 150 people from over 15 nations.”

“With around 1500 employees”, Uebersax and his team have their work cut out for them sourcing talent and even transporting their own staff. More so from a passenger perspective when considering that “the railway company transports 12 million passengers a year.”

From a product point of view, whilst the team at Retail inMotion is highly skilled in ensuring a smooth roll-out for its customers, it’s not to say the process is without its challenges.

“Certainly, the past couple of years have been tricky for anyone working in procurement. Drastic price increases due to inflation and tight supply chains have resulted in items being out-of-stock and solving these issues at short notice is something we have had to deal with.”

All of which begs the question, how do suppliers of travel catering and onboard products reliably source interesting, quality products whilst mitigating logistical issues?

Suppliers and product sourcing

Considering that as much as 90% of a company’s total environmental footprint can be made up across its supply chains. Then, reliably sourcing ethical, local and exciting products in an Alpine setting appears ever more impressive.

“What ends up in our pots and on our plates is the best that the region we travel through every day has to offer”, says Uebersax. 

“To achieve this, we work closely with producers from the region who make their products with care, enthusiasm and passion and who share our philosophy as passionate craftsmen.”

“Together we create a fascinating world of enjoyment, a wonderful mirror of the region our guests travel through.” 

“Certain suppliers are located right on the railway line, so customers can see where the products they are about to consume come from.”

For Kammer, output and feedback from continuous interactions are passed to the procurement team so they can source unique and special products that match their needs.

“We track the progress of the different sourcing initiatives that we are steering, as well as moderate any strategic issues we have with suppliers and drive different internal and external projects to help develop our sourcing capabilities even further.”

This drive appears to be paying off, too. LSG Sky Chefs and Retail inMotion reported revenue growth of 75% to €1,960 million in 2022, a recovery to 85% of its pre-pandemic sales. Though alongside financial growth, it’s clear that the real goal still boils down to enhancing the passenger experience.

LSG sky chefs vans

Passenger experience

Annually, Panoramic Gourmet “hosts serve over 200,000 guests with culinary delights from the on-board kitchen on wheels”, says Uebersax. 

“We accompany our guests with culinary delights on their journeys through the magnificent Swiss Alpine world.” 

The creation of something bespoke is a sentiment Kammer echoes. “For us as a procurement department, it’s extremely important to provide exclusive products to our airline customers. The overall aim is to create a unique customer experience onboard and this is what lies at the heart of our daily routine.”

For Uebersax, “the main focus of Panoramic Gourmet is to provide our guests with an indescribable Alpine railway experience and a culinary journey through our regions with a lot of passion from our staff.”

So, in the creation of these experiences — sourcing everything from onboard talent to ingredients, where do companies like Retail inMotion and Panoramic Gourmet start? 

“Beyond product sourcing, there is also a sense of collaboration among the industry at WTCE and the networking opportunities are second to none.”

Benjamin Kammer
Senior Category Manager for Food, Beverage and Retail, Retail inMotion

The importance of trade shows

WTCE is designed to make the lives of onboard buyers and companies working to source new and innovative products for airlines, rail operators and catering companies as easy as possible.

Attending WTCE helps me to keep up to date with the latest trends in gastronomy, food and catering” says Ubersax. Likewise, Kammer believes that “exhibitions offer the best way for us to track and screen the market.” 

But it’s not just theoretical; Ubersax adds that “products (digital, software, logistical inventory, etc.) are equally important to me to equip our staff with the latest support to make their job easier.”

“WTCE is unique”, says Kammer, “in that it has such a strong focus on one specific industry. Having visibility of such a large range of new products is a big plus and we wouldn’t usually be able to review the market that efficiently from a procurement perspective.”

And for rail operators, travel catering companies and airline suppliers alike, the show cuts out a lot of the logistical work both Kammer and Uebersax are all too familiar with.

As Kammer notes, “we often have to explain our specific needs to brands in terms of product size, package, quality, etc. because it is different from what they will provide retail buyers.

At WTCE we don’t need to ask this, and the exhibitors already know more or less what we are aiming for. This is hugely beneficial and makes the process very efficient for us.” 

Advice for WTCE suppliers and attendees

For those considering attending the next edition of WTCE, Kammer shares his advice:

“Have a target list of the companies in mind that you want to talk to, as well as an idea of what you want to achieve.” Free-to-use tools like WTCE Connect can help you streamline this process with personal recommendations and the option to book meetings.

Likewise, Ubersax offers: “Take advantage of the network that WTCE provides. Attend the events with curiosity, interest, without prejudice and with open eyes.”

To this, he makes “a list of our current challenges to look at how WTCE can help me overcome them.” To ensure efficiency, your “trade fair visit must be well planned, otherwise, you will quickly be distracted by many other suppliers and products” (with 250+ and 1,000s on the show floor, respectively).

Kammer, on the other hand, highlights also the need for flexibility at show. “Keep a loose agenda in mind but also be open to new ways of looking at different products and issues, because then you can really make the most of your visit. 

If you are keen to improve the issues you face within your business and understand the new solutions on offer, you will leave the event in a much better place.”

Find out more about what’s on at WTCE this year:

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World Travel Catering & Onboard Services Expo (WTCE) is the leading global event for travel catering, onboard retail and passenger comfort. WTCE is renowned globally for providing a platform for innovative suppliers to showcase the latest products and services in passenger comfort, catering and travel retail to help create the ultimate passenger experience.