Catering Will Continue to be a Big Business Opportunity for Operators

Catering was a $40 billion business for restaurants in 2018, and continued robust growth is  forecasted over the next five years, with the catering segment growing to $56 billion. As more and more restaurant operators seek to take control of their off-premise operations, catering —  particularly business to business orders — will continue to be a sizable growth opportunity for the restaurant industry.

These are some of the findings from the 2018 Takeout, Delivery and Catering Study, commissioned by Off Premise Insights, a division of Monkey Group, and conducted by CHD Expert.  The study examines the off-premise landscape, including a five-year market outlook, provides consumer insights on usage, decision drivers, and order placement dynamics and expectations.  It also includes perspectives from restaurant operators on their off-premise programs and catering best practices. Over 3,000 consumers who ordered takeout, delivery or catering within the past month and a number of operators were surveyed and interviewed for this study.

Over one-half of catering orders involved direct delivery from restaurants, while about 40 percent were picked up from the restaurant.  The study also found that a typical catering order serves approximately 11 people with an average cost of $140, and that almost one half of catering orders were placed on impulse, versus planned ahead of time.  What this means for operators is the need to adapt to be able to fill “on demand” catering orders, requiring shorter lead times and faster fulfillment.

With the vast majority of catering orders being placed by consumers (88%) versus businesses (12%), it is interesting to note that the “typical” catering patron is male, lives in the suburbs, has a college degree and resides in a household of 3 people.  The study found that most catering orders (36%) are placed in the Southern United States, followed by the West (25%). Business-to-business catering is expected to grow faster than social catering over the next five years, so finding new ways to tap into these occasions will help expand the breadth of operator catering platforms.

When asked about the first chains that come to mind when thinking about a catering order that will be picked up, consumers mentioned Subway, Panera and Chick-fil-A.  For catering delivery, consumers mentioned Panera, Subway, and Olive Garden. Chipotle, Pizza Hut and Jimmy John’s were also in the consideration set.

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