Jumping into catering may seem like any easy way to increase profits, considering off-premise catering sales resulted in more than $52 billion last year and that 64 percent of those dollars went to restaurants. Franchisors and their franchisees, however, must understand what they're getting into before deciding if catering should be a part of the business model, according to several catering experts speaking on the panel, "Should My Franchise Caster?" at the Restaurant Franchising & Innovation Summit ,March 29-31 in Dallas.
One of their first tips was to never think of catering as a footnote to the business.
"That would be like looking at the drive-thru as a separate business and saying, 'We really just focus on dining in.' Everyone owns catering," said Paul Hicks, SVP and Operation Services & New Concept Development of Corner Bakery Cafe.
That strategy must be paying off, as Hicks pointed out that catering makes up more than 25 percent of Corner's business. The company takes it seriously -— it has a full-fleet support and management system in place for all locations, including graphics design, vehicles and fuel/maintenance.
"Catering is not just something we do; it is who we are," Hicks said.
Uncle Maddio's also views catering sales as a major way to increase profits, COO Scott Goodrich said, pointing out that while a typical retail model is:
Average Check x Transactions = Sales
Uncle Maddio's follows:
Average Check x Transactions + Catering = Sales
"The catering model is noteworthy because it demonstrates that catering sales go directly to the bottom line," Goodrich said. "We also have the opportunity to drive trial with new dine-in customers through catering, which increases the number of transactions."
Goodrich and the other experts agreed that restaurants hoping to succeed in catering must always:
Delivering food how it's supposed to be served
It may sound like a no-brainer, but restaurant operators can't underestimate how detrimental it is to the future of their catering business when food arrives cold. Also, the food needs to look great, said Jessica James, principal at Clean Plate Consulting and former chef for Applebee's. She discussed how Applebee's had to eventually change its catering packaging after discovering that it was too big for the food.
"(The food) looked a little sloshed around when it arrived,"said James. "You have to use packaging that maintains the quality and makes the food look good.”
And if there's not a packaging option that will keep the integrity of the food, it's best to take it off the menu.
Corner, for example, won't deliver its paninis.
"The quality of the product doesn't carry well," Hicks said. “We have nothing on the catering menu that we don't sell at the counter, but 80-85 percent of menu we won't cater.”
"Do not try to push a catering order on a food that doesn't travel well," he said.
It's also important to use resources that don't affect the customers in the store, which is why Uncle Maddio's has developed a dual production line that allows staff to serve the dine-in guests, while executing catering, online and phone orders without disruption.
"Speed of service and throughput is key," he said.
The freedom of the ordering platform
From a catering perspective, 98 percent of Corner's online orders are placed via desktop.
"Not by phone, not by app, from their desks, but we will take orders any way you give them," said Hicks, whose bulk of catering orders come from corporations.
"We like the business clients — law firms and marketing companies — that have large meetings," he said. "They have a big budget to deal with, and the people placing those orders are sitting at their desks in front of their computers."
Other catering must haves
Lastly, the experts agreed that online ordering and keeping catering menus updated were also key to pulling off a successful catering program.
"Nothing is more aggravating to a guest than ordering something from an old menu that is no longer available," James said. "You would be surprised how often catering menus get overlooked when updating the menu."