Professional Documents
Culture Documents
Benji Arrigo
This document serves to roughly outline the changes being made, and to inform the student
body and other stakeholders in our community about the possible motivation behind such claims.
We’ll explore the new meal plan, why we have Chartwells, what and who Chartwells is, and how
profits come into play. While reading, please keep in mind that Chartwells is a for-profit
corporation.
Essentially, block meals are replacing the current buffet style system. You swipe your meal and get
a ticket, and that ticket is redeemable for a full meal at a “branded” stall, much like buying a meal at
a mall food court. You get the full meal from one stand, entrée, side, and drink.
Everywhere except Towers, St. Vincent’s, and Houck’s Place will be flex-only. That includes the
University Center, Starbucks, Subway, and more. No more using meals at Starbucks or Subway. The
new plan also includes a modest increase in the amount of Flex available, encouraging students to
spend more cash out-of-pocket.
Definitions
RFP – Request for Proposals, a process used at many universities to make large purchases.
Publicly Traded – The public can by shares in this company via a stock exchange.
When Southeast Missouri State University looks to make a large purchase, they often choose
a process involving an RFP or Request for Proposals. Software and infrastructure like Canvas, the
school website, scheduling systems, and dining services like Chartwells have all gone through the
RFP process. The school asks for proposals, and potential contractors submit a publicly accessible
document.
Chartwells is far more than just a small catering service handing your meals on campus.
Instead of a naturally flowing river, the University uses Chartwells like a series of locks, dams, and
canals. One might think that money flows to like this: You >pay> University >pays> Chartwells. But
you’re missing an important final step: You >pay> University >pays> Chartwells >pays> University.
Chartwells is an important multi-million-dollar revenue stream for the University. You first
pay the university your room and board, they pay a portion of that to Chartwells, and Chartwells
serves you meals. At the moment you redeem or purchase a meal (through Flex, Redbucks, or Cash),
the University takes a percentage on the “sale” of that meal. A percentage that sings to the tune of
$2,950,000 dollars in guaranteed commissions every year, according to Chartwells latest RFP from
20152. Chartwells also included in their contract a $500,000 signing bonus, $6,575,000 in
renovations, and $190,000 in donations, all paid to the University. One of the donations includes
$10,000 for President Carlos Vargas’s inauguration ceremony.
That Starbucks Oatmilk Shaken Espresso on campus is valued, in dollars, a little higher than
the one at the Starbucks down the road. There’s Chartwells profit margins to meet, and Southeast
commissions to pay. While traveling deep in the woods of mission statements, financial reports,
renovation plans, and work schedules, keep in mind that Chartwells is a for-profit corporation that
considers Southeast an excellent partner in business.
2 (Chartwells, 2022)
3 (Chartwells Higher Ed, 2022)
4 (Compass Group USA, 2022)
Charlotte, NC. Compass Group USA is a wholly owned subsidiary of Compass Group PLC5, a publicly
traded company based in the United Kingdom. Compass Group PLC is the largest food service
company in the world.
Chartwells is just one part of a modern corporation with a global reach. Their business
model includes what appears to be large amounts of local control, as seen on our own campus
through the hiring of two Southeast graduates to lead the local operations. There is credit due to
Chartwells and Compass Group for their commitments to diversity, climate change, plant-forward
menus, and other forward-thinking initiatives. However, this meal plan change is nothing more
than a cost-cutting scheme by a global corporation to increase profits in response to the challenges
of the pandemic, while providing increased commissions for a pandemic struck state university.
Money, much like the food we eat, has to come from somewhere.
For convenience I have converted the following amounts from British Pounds (£) to US Dollars ($).
In 2021, Compass Group PLC had $24.6 Billion in revenue, and made $1.1 Billion in profit.
Their underlying profit margins sit at 4.5%, compared to 2.9% in 2020. In short, they are what can
be classified as a “Cash Cow” in the business world. A hard to enter market, limited competition,
and extremely high (95.4%) customer retention. Chartwells keeps themselves embedded in local
communities and “digs in,” through custom branding, local leadership, just-enough transparency,
and more. This makes it hard for institutions like Southeast to even consider a different food service
provider.
Additionally, in 2021, Compass Group saw a 10.2% revenue decrease, but a profit increase
of over 85%. That’s a drop of around $3 Billion in revenue, but an increase of around a third of a
billion in profits. How did they increase profits while experiencing declining revenue? Cutting costs-
and it is exactly what they are planning on doing at Southeast.
But no great story makes it without a thrilling plot hole solved by an epic twist. Readers
might wonder why the University would support a such a cost cutting program. The University has
seen declining enrollment7, and declining net assets and revenues8. This leaves them eager to work
with Chartwells to generate additional revenue for both parties through a cost-cutting initiative.
Readers, at this point you might be feeling a little hopeless. What say might you have when
it comes to the management of millions of dollars? What can be done when the University finds new
ways to lower quality and value for Missourians and their families? Is Chartwells really doing
anything wrong by making a bigger profit? (yes)
You do have a choice. You get to choose where to put your money, your time, and your
resources. Knowledge is power, and it has the potential to drive real institutional change. The Board
of Governors will vote on the changes in a few short weeks. As citizens and stakeholders in an
educational institution- your words really do matter, as seen in the compromise found at University
of Arkansas. Write a Letter to the Editor at the Southeast Arrow and the Board of Governors
informing them about how you feel. Don’t be afraid to look where others glance, and take a scientific
approach to what others tell you. It pays dividends far greater than gold.
Author’s Note: The email and physical mailing addresses for the Board of Governors is provided below,
along with contact information for Chartwells and Bruce Skinner. Please be polite when contacting
anyone on this list- we all share the belief that the University can improve.
Alicia Ticer
Chartwells – Email her for Information about Redhawk Dining Advisors
alicia.ticer@compass-usa.com
Bruce Skinner
Associate Vice President for Student Life
bskinner@semo.edu
All Board Representatives
Edward P. Gargas, Tina L. Klocke, David C. Martin, Lloyd F. Smith, James P. Limbaugh, Vivek Malik
board@semo.edu
One University Plaza, MS 3300
Academic Hall 144
Cape Girardeau, MO 63701
Additional Reading
The Rising Cost of College
In the process of writing this document, Jonah McGuire sent me an interesting article that mentions
the relationship between Chartwells and Southeast9. They talk about the guaranteed commissions,
what happens at other schools, the corporate giants at play, and the student impact.
A Compromise Available
During the Student Government presentation on February 7th, Bruce Skinner mentioned the model
for the plan that he witnessed at the University of Arkansas. Yet the meal plan there still includes
the traditional meal plan alongside the block meal plan.10
Chartwell’s Positioning
On the meal plan FAQ page for Pace University, a Chartwells client where every student is required
to have a meal plan, they claim that a meal plan is required so that students better adjust to college.
“Studies consistently show that on campus dining and socializing has numerous educational and social
benefits, including contributing to graduation rates, assisting in better transitions from high school to
college, meeting with and making new friends, and providing convenient options -- without the need to
carry cash -- between classes or while studying. For off campus students, establishing on-campus
connections and friendships are also critically important.”11
Chartwells fails to cite a single source on the topic. No matter if it’s true or not- it sure is profitable.
But lacks
9 (Mathewson, 2022)
10 (Chartwells, 2022)
11 (Chartwells, 2022)
References
Chartwells. (2022, February 9). Chartwells RFP Proposal. Retrieved from SEMO:
https://semo.edu/pdf/Success_Chartwells_RFP_Response.pdf
Chartwells. (2022, February 9). FAQ About Southeast's Meal Plan. Retrieved from SEMO:
https://semo.edu/blog/blog-posts/faq-meal-plans.html
Chartwells. (2022, February 9). Pace NYC Meal Plan FAQs. Retrieved from Dine on Campus:
https://dineoncampus.com/pacenyc/meal-plan-faqs
Chartwells. (2022, February 9). University of Arkansas Student Meal Plans. Retrieved from Dine on
Campus: 2022
Chartwells Higher Ed. (2022, February 8). Who We Are. Retrieved from Chartwells Higher Ed:
http://chartwellshighered.com/who-we-are/
Compass Group PLC. (2022, February 8). 2021 Annual Report. Retrieved from Compass Group PLC:
https://www.compass-group.com/en/investors/annual-reports.html
Compass Group PLC. (2022, February 8). Compass Group. Retrieved from Compass Group:
https://www.compass-group.com/en/index.html
Compass Group USA. (2022, February 8). Contact Us. Retrieved from Compass Group USA:
https://www.compass-usa.com/contact-us/
Mathewson, T. G. (2022, February 9). A tough-to-swallow reason college keeps costing more: the
price of meal plans. Retrieved from The Hechinger Report: A tough-to-swallow reason
college keeps costing more: the price of meal plans
Southeast Missouri State University. (2022, February 9). Summer 2021 Financial Statements.
Retrieved from SEMO: https://semo.edu/finance-admin/_pdfs/southeast-missouri-state-
university-financial-report-20201.pdf
Southeast Missouri State University. (2022, February 9). Three Year Enrollment Report. Retrieved
from SEMO: https://semo.edu/institutional-research/_pdfs/cen-sem-enrollment-fall-
2021.pdf