Food & Beverage

Companies find that the next frontier in attracting talent lies in giving them free food

Key Points
  • ZeroCater surveyed 13 companies, finding that the most in demand snacks included Austin Zoo Animal Crackers and LaCroix beverages
  • Clients on average spent about $208,000 a year on snacks for companies with about 100 employees

From LaCroix to animal crackers, San Francisco based start-ups are spending big bucks to attract top talent, according to a recent study.

Food service company ZeroCater, which delivers catering to start-ups in the area, and estimates that offices spend roughly between $78,000 and $208,000 a year on snacks alone for a company of 100 people. The company, which has a client roster that includes Adobe, Visa, Wells Fargo and Salesforce, surveyed over a thousand employees at 13 separate client companies.

Among the most popular items were La Croix Sparkling Water, Honest Teas and High Brew Coffees, ZeroCater's study found. Companies are also stocking shelves with fresh produce and Emergen-C, in a bid to ward off office sickness.

However, it's not all protein bars and low calorie beverages. Offices tend to stock a wide variety of edibles, from Cheez-Its to Fruit by the Foot. The most popular guilty snack, according to ZeroCater, are Austin Zoo Animal Crackers.

ZeroCater Snacks

Food as job lure

While free grub is hardly considered a deal-breaker when a job seeker accepts an employer's offer, it has become an increasingly popular perk for some companies within and outside of Silicon Valley. That includes media giant Bloomberg, where workers are known to wax enthusiastically about the company's bounty of complimentary snacks.

Meanwhile, with the average company spending between $3 and $8 on snacks and beverages per employee each day, in-demand items can make the difference in attracting talent.

For its study, ZeroCater polled employees at a variety of companies about how satisfied they were with their free snack offerings. From a scale of 1 to 5, the average checked in at a lowly 1.7, underscoring how some companies may be looking to beef up what they offer to employees.

SurveyMonkey, an online survey development company that outsources their snack and meal catering, offers employees two meals per day in addition to snacks.

"It is a bit of an art and a bit of science, we take a pretty data driven approach. We ask employees which dishes they enjoy" Rebecca Cantieri, SurveyMonkey's vice president of human resources, told CNBC recently. Underscoring how seriously the company takes feeding its employees, she added that SurveyMonkey's chef actively solicits cooking ideas.

"We also watch inventory patterns so it gives us a sense of what employees take advantage of, what they enjoy and what is less of interest," she said.

Cantieri estimated that SurveyMonkey spends close to $10-$15 a day per employee (more than 700 of them, according to LinkedIn) on meals and snacks. The food offerings not only promote healthfulness but foster a sense of community, Canteri told CNBC.

In fact, employees surveyed at the company ranked food in their top five of what is most meaningful to them, along with medical benefits, work flexibility and other key quality of work-life factors.

'Painful and time consuming'

ZeroCater Group Lunch

ZeroCater is based in San Francisco but serves clients in San Francisco, Los Angeles, New York City, Chicago, Washington D.C. and Austin. The company has raised $5.6 million in funding since its inception in 2009, and boasts over $100 million in sales to date.

Arram Sabeti, ZeroCater's founder and CEO, got his start in Silicon Valley, where one of his duties actually involved office catering. "I sold my car, sold my stuff [and] moved into the Bay Area," he told CNBC in an interview.

"I eventually joined a company called Justin.TV, I was the fifth employee there." Justin.TV would go on to combine under the name Twitch Interactive and then be acquired by Amazon in 2014.

The CEO at the time tasked Sabeti with ordering lunches for the whole office. He began doing everything from placing food orders, recruiting, office managing and more.

"Of all the different hats I had to wear, by far the most painful and time consuming was ordering the lunches because you had to figure out where to order, what to order, how much to order, what is gluten free, vegan, doesn't have shellfish in it and restaurants that would make people generally happy," said Sabeti.

Sabeti stated that ordering for a company of roughly sixteen at the time took well over an hour. Meanwhile, many restaurants had trouble accommodating and remembering dietary restrictions.

ZeroCater Office Lunch

That experience helped Sabeti tailor ZeroCater's business model, which is being influenced by the industry's use of food as key to luring talent.

"We really see snacks as that second wave of employee benefits that companies are providing and employees value," said Ali Sabeti, ZeroCater's vice president of sales.

"Any companies that need to attract top talent, they're buying their employees Blue Bottle Coffee, they're buying Kombucha, they're buying Yerba Mate," Sabeti added. "These are the perks they're offering their employees so they stay productive."