The channel has become an intensifying battleground as operators work to maximize their four-wall profitability from the added business stream
Catering has become a much bigger part of the conversation throughout the past couple of years as restaurant operators look to maximize their revenue streams to offset higher input costs. The channel has outpaced overall industry growth by 50%, with chains from Red Robin to El Pollo Loco to Applebee’s and Bloomin’ Brands ramping up their programs.
But it isn’t just the big players jumping into the space. Smaller concepts and even independents have also begun adopting catering in earnest. Mario's Pizzeria of Naugatuck just launched a new catering service, for instance, while St. Louis Italian-style eatery Porano has also jumped into the channel. New York City-based Delmonico’s Restaurant Group just added a partnership with Elegant Affairs Catering, called Delmonico’s by Elegant Affairs, to offer a premier off-site catering option for events around Manhattan, Long Island, and the Hamptons.
These additions are certainly creating an intriguing competition for top-of-mind awareness, especially during the holidays – a new report from Channel Media Group finds that 90% of businesses plan to cater from local restaurants this season.
These smaller chains and indies have their work cut out for them with smaller marketing budgets, but there is plenty of optimism about catering’s potential, nonetheless. Here’s how some of them are approaching their fledgling channels.
Killer Burger recently began testing catering in partnership with ezCater. The company has made significant enhancements to its kitchen operations to manage heavier order volumes and is gauging demand for a “party-in-a-box” experience featuring its signature builds outside of restaurants. Currently, a “Killer Box” features 12 Mix & Match Pint Burgers.
“It’s all about getting more burgers in more mouths without sacrificing taste and presentation quality, and creating memorable experiences for our guests,” a Killer Burger spokesperson said. “We’re excited about the potential for catering to boost brand awareness and bring in additional revenue. Catering is a powerful channel for word-of-mouth marketing. The more people we reach through catering, the more we can build brand loyalty.”
Such a tactic could come in handy as Killer Burger expands outside of its Pacific Northwest home markets for the first time with its recent opening in Texas.
As for the intensifying competition in catering?
“We see our catering as a ‘party in a box’—a fun, high-quality option that brings the Killer Burger experience to any event. With plenty of mix-and-match options and unique flavors, variety and value, we’re confident that our catering will level up any event,” the company’s spokesperson said.
Asian Box’s chief executive officer Chuck Imerson said catering has always been an integral part of the 7-unit business, but it’s “strategic importance has grown significantly.”
“With companies actively encouraging employees to return to offices, corporate catering has made a strong comeback as a key employee benefit. As employees increasingly stay in the office for lunch rather than dining out, we’ve seen a shift in consumer behavior. Our catering program allows us to capture that demand while offsetting the dip in foot traffic, ensuring we remain a vital part of our customers' dining experience — whether at the office or at home,” he said.
This year, catering at Asian Box returned to 2019 numbers and Imerson expects that trajectory to continue as more companies invest in office culture. With that growth, catering has become a critical driver of profitability, he adds.
“(The channel) offers higher-margin sales while optimizing labor utilization,” he said. “The ability to batch-produce orders for large groups allows us to enhance operational efficiency, driving significant returns beyond the standard dine-in model.”
In a crowded category, Asian Box will stand out with its gluten-free Vietnamese cuisine, he adds, while offering both individually packaged meals for convenience and buffet-style setups for larger events.
“This dual approach allows us to meet the needs of businesses, from small team meetings to company-wide events, without sacrificing quality or presentation,” Imerson said. “Also, we prioritize relationships with our existing customers by keeping them informed about our catering services through personalized reminders and targeted promotions and we’ve expanded our marketing efforts through a combination of social media campaigns, hyper-local print ads, and word-of-mouth referrals.”
Imserson believes catering will remain a powerful opportunity, and he expects “substantial” growth for the channel.
Angry Chickz, which has grown to nearly 25 locations, launched catering a few months ago in response to consumer demand. Vice president of marketing Tonya McCoy said the channel is a natural progression for the brand, and a way to bring Angry Chickz food to more people more often.
“Catering is a whole new way for us to serve our fans while creating an exciting new revenue stream that complements our existing in-restaurant, takeout, and delivery channels. Plus, it’s a great opportunity to boost brand loyalty and make Angry Chickz a part of our customers' most memorable moments,” McCoy said.
While Angry Chickz wouldn’t disclose the investment it has put behind the new channel, McCoy said the bigger orders lead to bigger returns. Further, catering opens the door to repeat business from corporate clients and event planners.
“We’re confident that this new channel is going to add some serious spice to our bottom line,” she said.
Indeed, it’s Angry Chickz signature spicy profile that will allow the chain to stand out as more brands jump into catering, McCoy added.
“We’re confident that our bold flavors and customizable options will make us the go-to choice for all kinds of celebrations,” she said. “The feedback from our customers has been overwhelmingly positive, and we’re confident that catering will become a key part of our growth strategy.”
Six-unit, California-based World Wrapps co-founder Matt Blair said his company’s signature products – wrapps, bowls, salads, and desserts – are made to cater and, as a result, the channel has proven to be successful.
“We want to be in the space because there is nothing better than banking $1,000 to $5,000 in sales before you even officially open the doors. Your labor percentage goes screaming lower and you are fast out of the gate sales wise,” he said. “It's a huge (return on investment) because you bring in a few laborers a little earlier depending on catering totals, but all other costs are fixed so these incremental sales truly help bring down any fixed costs we have.”
World Wrapps’ catering channel was growing before COVID halted its momentum. In the past six months, however, the business has been steadily increasing as more employees return to the office, while the company has ramped up its promotions – for example, recently offering a 10% discount on weekend orders over $100 with the code “football.” Blair expects the momentum in catering to continue and is bullish about the potential, which he calls “humongous.”
“We know that offices are only 33% occupied in downtown San Francisco and San Ramon. Even if that just gets back to 50% occupancy that could increase our catering by 30%,” he said. “We are excited to see more and more office workers returning and it feels like it has started happening.”
Contact Alicia Kelso at [email protected]
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