Catering offers a big opportunity for fast-casual and quick-service restaurants, but the effort to exploit it is often an afterthought, according to participants in a Restaurant Leadership Conference session focused on building sales.
"Right now for off-premise catering, your customers are going to the grocery store—Costco, Safeway, etc," said Erle Dardick, a former restaurant operator who now serves as CEO of a company that markets catering software, MonkeyMedia.
Operators from Einstein Noah Restaurant Group, Boloco, Ruby Tuesday, and Modmarket explained how their operations have benefited from strategic efforts to capture that business.
The session focused on off-premise catering. Unlike event catering, Dardick said, that form aims to feed customers where they live, work and play—Monday through Friday, with fairly predictable breakfast, lunch or dinner programs, using a subset of the menu.
Dardick contended that success in catering requires adherence to a standard and making the most of existing assets. The play is long term, he stressed; it has to be strategically connected to the rest of your business
In other words, if your concept serves Mexican food, don't offer macaroni & cheese as part of your catering menu.
That being said, the panelists agreed, catering is its own animal, requiring dedicated resources, especially a sales manager and a separate team. Don't rely on your cashier to drive the business, or even take down an order. Making a catering sale requires a different touch than taking orders at the concept, and often entails an emotional connection with the customer.
There are different off-premise catering channels, each with their own price point: drop-off, set up and retrieve, and full service. Each layer of service and packaging has its own price points; the food is the same, the only difference is the layer of the service.
Among the other tips that the panelists offered:
- Take what doesn't work well and fix it. Ruby Tuesday found a lot of items on its regular menu weren't going to work within a catering program and focused on its Garden Bar concept, reported Andy Hepp, vice president, operations support & implementation.
- Your client isn't the CEO, it's the administrative assistant or receptionist. They are the ones who are going to make the decision regarding catering. Treat them well; in honor of National Administrative Professional Day on April 24, Boloco "tries to spoil them as much as we can," said Erin Childs, director of catering.
- When it comes to catering, you are sharing the same kitchen with your restaurant, but everything else is different, said Anthony Pigliacampo, founder of Modmarket.
- "The biggest secret to a successful catering operation is you need dedicated leadership," said Pigliacampo. "We hired a catering manager when we had only two stores." Catering revenues are currently between 10-12% of sales.
- When a customer asks for a discount, change the conversation to "What's your budget?" Boloco will throw in free salsa and chips so the customer feels they are getting more than they paid for.
- Einstein Bros., which is poised to deliver breakfast for 80,000 across 70 different sites, doesn't discount the service it is providing. Its message, said Wayne Alexander, catering director, is clear: "We are providing this service, we are going to handle this event, on time; we will make it easy for you."
- Don't go off-menu; offer what you do best so your brand is well represented. "If a customer insists they want something other than what we cater, I recommend they go elsewhere," said Childs.
- Become same-day caterers, Dardick challenged the panelists and audience members. "If you can execute that kind of urgency, without stressing the operation, it's an incredible opportunity."
- Dardick also noted that not every store in your chain should do catering. You have to identify those stores that can handle the last minute orders. You can do this on a market-to-market basis, driving the last minute transactions to those stores.
- Boloco, which has 23 units mostly in the New England area, generates between $1,000-2,000 per day in last minute sales, reported Childs. "We've trained our sites to let us know with a 'yes or no' answer whether or not they can handle the order."
- To drive more catering sales, Modmarket uses LinkedIn, paying a "nominal" fee for targeted lists of administrative assistants, for example. "We establish a one to one email contact with them," said Pigliacampo. " It's so effective; they love having that virtual relationship."
- Modmarket tracks how many of those initial leads generate sales. For example, an initial list of 1,000 will eventually lead to 40 attending a free lunch, where the catering team does a dog and pony show, which, said Pigliacampo, always leads to conversions.