Catering continues to be big business for restaurants; as a group, they capture almost five times the revenue of retailers for off-site events—$19.3 billion annually versus $4.0 billion, reports Technomic’s recent Parties Off Premise study.
While several market segments are projecting three-year compound annual growth rates (CAGR) tallying 5 percent or better, fast casuals are poised to outperform all other players, with an anticipated growth rate of 12 percent. Quickservice sandwich spots follow, with a CAGR of 8 percent, and club stores have a projected growth rate of 7 percent.
“Improvements in food quality, especially at fast-casual and fast-food chains, appear to be a significant factor in restaurants’ recent gains with catering consumers,” says Melissa Wilson, principal and director of the Parties Off Premise (POP) study. Limited- and full-service restaurants hold the largest shares of this market (36 and 34 percent, respectively) and appear to be taking share from independent caterers and retail foodservice operators, says Wilson.
Other findings:
- At $27.5 billion, the size of the consumer catering opportunity is significantly larger than similar opportunities with business-to-business users (corporate/pharmaceutical representatives), estimated at $15.8 billion.
- More than a third (36 percent) of surveyed consumers expect to entertain at home more often over the next year, while only 5 percent say they will scale back.
- Twenty percent of surveyed consumers would now consider quickservice restaurants as a source for at-home catered occasions, compared to just 7 percent in 2009. In contrast, warehouse clubs have slipped 7 percentage points in shoppers' minds, from 26 percent in 2009 to 19 percent.
- Social catering occasions can provide a consistent stream of business from core customers. While seasonal peaks are evident for specific occasions, the majority of users average more than two of these purchases each month.
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