Concession Services Inc.: Diversified Food and Beverage Distribution

The story of Concession Services Inc. (CSI) started when Paul Rosenbaum brought his family to the United States in 1939. “My family emigrated here from Czechoslovakia,” says Edith Leonian, Paul’s daughter and the current president of CSI. Paul founded the company with his brother, Max, only a few short years after arriving in the country. “My uncle Max was already here,” explains Edith, addressing the company’s inception. “He and my father were in the business of putting penny scales in New York subway stations.”

The ambitious Rosenbaum brothers soon decided that they could find success by expanding into the vending business. Paul and Max could not obtain licensing for their beverage machines in New York, so the family moved to Chicago to set up shop. “They started by putting Coke machines into various movie theaters and that part of the business just kept expanding,” says Edith.

CSI had grown into the dominant concessions company in the area in the 1950s. The business ran concessions at several regional theater chains and the brothers – who worked harmoniously as co-owners – had made some major innovations to the business, including the design and manufacturing of multiple drink and fresh-brewed coffee machines.

Following in her father’s footsteps, Edith became CEO in 1989. “My mother owned it, but she really had no business experience or any interest,” explains Edith. “We still wanted to maintain the company, so I took over. I started here part time and eventually I was just here more and more.”

Edith’s background is in partnership with her husband – Phillip Leonian, a photographer – as his agent and producer. Photography may seem unrelated to the business, but Edith surprised herself. “Until I got into CSI, I never realized how much I had learned about all kinds of things,” says Edith. “People don’t realize how much they’re actually revealing when you’re taking pictures.”

Concession Evolution

When national chains started buying out movie theaters, many chose to run their own concession stands. “We still serve about 150 independent theaters,” explains Edith. However, the business model has changed significantly since the buyouts. “We no longer have a large presence in theater concessions,” she says. “Those national chains deal with national companies, and we don’t have the capacity to serve businesses with locations outside our four-state territory.”

CSI has since moved into the wholesale industry, and no longer operates concession stands. “When my father passed away, we found that some of our employees who had been with the company since the ’40s had no pension,” says Edith. “We couldn’t just liquidate. We switched that part of the business from retail to wholesale.”

Today CSI supplies companies with meals, snacks and beverages alike. “Vending operators make up a majority of our business,” elaborates Edith. “We also do hospitals and schools. We have a good relationship with visually impaired vendors who operate concessions in office buildings and rest stops through various state programs.”

The Spread

CSI introduced the first online ordering system in the vending industry in the 1990s, which has remained fundamentally unchanged. “Online ordering has become essential in this business,” says Edith. “But we still have the simplest system.” The Internet catalog is set up as one big order form, broken down into six categories – snacks, candy, food, beverage, supplies and food service – with respective subcategories for easy navigation. “We have to cast a wide net because we’re focused on a niche market with niche merchandise,” explains Edith, referring to the catalog’s hundreds of entries.

Luckily for Edith and the CSI team, the vending market is expanding and is no longer limited to bottled sodas and single-serving bags of chips. New innovations in hot and cold food and beverage have allowed a major expansion of the range of foods available. “More people have cold machines than they used to,” says Edith. “We have everything from sandwiches to tacos to whole meals. That part of the business has really grown over the last five years as machines have advanced.” Many vendor operators have expanded into office coffee service, allowing CSI’s large selection of work place brews to grow popular over the last few years. Edith says, “It’s really taken off.”

Most of Edith’s clients are independent operators. They generally don’t order enough of a single brand at a time to buy direct from suppliers at a decent price, nor can they afford the time and labor costs to receive multiple deliveries. CSI works between manufacturers and vending operators distributing and consolidating orders to bring customers a wide variety of products at a more reasonable price. The company’s focus has always been to serve the customer efficiently and fairly, which keeps independent clients happy and in business. National chains simply cannot compete with CSI’s level of service, a fact that Edith’s customers constantly confirm.

Just like her father, Edith maintains a deep commitment to her employees and her customers. “Service is really our focus,” she says. “We grow by growing with our customers.” According to Edith, the key is communication, especially listening to the praise and concerns of clients. “It’s important for us that we stay in touch,” elaborates Edith. “We track our mistakes, we fix them immediately, and we try to prevent them from happening again. We’re picking up new customers all the time because we maintain that level of service.” Edith’s insistence on keeping a high level of consideration for the businesses, employees and clients has kept Concession Services Inc. steadily growing.