HOMETOWN: London
EDUCATION: Westminster College, London
PERSONAL: married, four children
HOBBIES: food, shooting, family
CAREER HIGHLIGHTS: president of TrustHouse Forte Foodservices, managing director of Gardner Merchant Food Services in the U.K., chief executive of Compass Group North America, chief executive of Compass Group PLC, chairman of TrustHouse Services Group
Michael J. Bailey has seen the on-site foodservice business from a number of different vantage points. He served as president of TrustHouse Forte Foodservices in 1985, where he grew sales from $30 million to $250 million. Then, in 1991 he was appointed managing director of Gardner Merchant Food Services in the United Kingdom. Three years later he joined Compass Group as development director and helped steer the company in its acquisition of Canteen Corp. in the United States. Soon afterward Bailey was named chief executive of Compass Group North America, and in 1999 he moved up to chief executive of Compass Group PLC worldwide.
Bailey took an early retirement in 2006 and moved to Switzerland, but after 18 months found he couldn’t stay away from the business. In 2008 he teamed up with David Vorhoff of McColl Partners, a boutique banker, and formed his own company, TrustHouse Services Group in Charlotte, N.C., by acquiring three companies — Aladdin Food Management Services of Wheeling, W.Va.; Fitz Vogt & Associates of Walpole, N.H.; and AmeriServe Food Management Services of Columbia, Mo. Last August, TrustHouse acquired a fourth company: A’viands Foods & Services Management in Minneapolis.
What made you decide to come out of retirement?
I was living in Switzerland at the time — I had lived there earlier, and it seemed like a wonderful place to live when I was busy. But I found it too quiet when I wasn’t working, and decided to do something again. It was a no brainer to come back to the Charlotte area. I had spent a lot of time here [with Compass]. I have a couple of kids in Charlotte from my previous marriage, and some old friends are here. And my wife is from Highpoint, N.C.
What was the thinking behind the formation of TrustHouse?
I was quite particular about the space I wanted to be in. I looked at the market in 2008, and it was obvious that we were going into difficult times. Having been through some bad economies, you learn quickly, and I knew I wanted to be in education and health care, not B&I or sports feeding.
How has business been so far?
We’ve grown organically in the last three years — modest single digits, for the most part. We’ve been pleased with the company and what we’ve achieved. I had hoped to grow faster through acquisition, but many owners are reticent to sell in this market, so that slowed us down a little. We just acquired A’viands, a $90 million contract foodservice business, in August.
How has the economy affected business?
Certainly, the economy has been tough. We’ve seen a lot of austerity in our accounts — we have 400 accounts in 31 states. There have been a lot of austerity measures taken in education and health care. But those have become a part of life. We just make sure we’re providing services that are cost effective. We don’t have too many clients saying they’d like to spend more money these days. You’ve got to tighten the belt.
What is your goal for TrustHouse?
Long term, I’d like to grow it to be a middle-market organization. There are the three big boys out there [Compass, Aramark and Sodexo USA], and then the industry drops away almost completely. We’re No. 9 with $225 million in revenue right now. I would like to see that grow to half a billion dollars in three to four years [through organic growth and acquisitions]. If we can do that, we’d be very comfortable.
What are the differences between piloting a large company like Compass and a startup like TrustHouse?
The biggest difference is you’ve got do it yourself. When you’re running a company like Compass, you have infrastructure to handle most everything. In a startup, if you need a budget, then you go and calculate it yourself. Many managers who do well in large companies wouldn’t do as well in small companies.
Contact Paul Frumkin at paul.frumkin@penton.com.
