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Pre-pandemic, catering was the fastest-growing sales channel in the restaurant industry. While that upward trajectory stalled with COVID-19, catering is back in a big way.
In fact, catering business is expected to grow at a rate of 6.2% in the next 8 years, reaching over $124 billion by 2032.
The catering boom presents a lucrative opportunity for restaurants to capitalize on evolving consumer behaviors and preferences. It’s no wonder leading brands are investing heavily in the channel.
Keep scrolling to find out what factors are contributing to its rise in popularity—and how your brand can seize the opportunity.
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7 Reasons Your Restaurant Can't Afford to Miss Out on Catering
1. Revenue potential
Catering's contribution to restaurant sales is significant, with the potential to represent up to 20% of total revenue. The average catering ticket today is $350—10x the average mealtime ticket of $35. That’s a significant lift from 2020, when the average catering ticket was $280. With catering, restaurants can diversify their revenue streams and benefit from recurring revenue courtesy of regulars who order weekly or monthly.
2. Return to office
While consumer spending is trending down, business spending is going up. Office catering is increasing as employers seek low-cost strategies to incentivize remote workers to return to the office and increase employee engagement. This is good news for restaurants as workplace catering often generates higher frequency and average checks than other catering jobs.
In some cases, the hybrid workforce has made it easier for restaurants to anticipate catering orders since Tuesday through Thursday are popular days to work in-office. Additionally, with fewer employees on site, some businesses have embraced catering as a budget-friendly alternative to a cafeteria.
3. Events
Business travel is expected to exceed pre-pandemic levels by about 6% in 2024. With most travel restrictions in the rearview mirror, more employers are hosting corporate events that bring employees and clients together in person. Additionally, large social gatherings continue to grow in popularity—from holiday parties to weddings, and everything in between.
In addition to being lucrative, event catering can create valuable networking opportunities for restaurants with event planners, venues, and other vendors.
4. Tax-exempt organizations
There are 1.7 million tax-exempt organizations—including schools, religious groups, and nonprofits—in America. That is a massive, untapped catering market for your restaurant to serve. A catering platform with built-in tax-exemption capabilities can ensure your brand stays compliant and organized while removing taxes from qualified orders.
5. Guest acquisition
Catering is a great way for restaurants to increase brand awareness and acquire new guests. When people experience your food and service at off-site events, they are more likely to visit your restaurant and tell their friends about it.
You can replicate your restaurant experience for catering guests (and drive repeat orders) with branded packaging and marketing collateral, regular communication, integrated loyalty, and a commitment to guest satisfaction.
6. Brand reputation
Dependable catering can help your brand build trust within your community. When schools, businesses, and other local groups know they can consistently count on your restaurant to deliver high-quality food in large quantities exactly when they need it, your reputation—word on the street, online reviews, etc.—and bottom line will be positively impacted.
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7. Seamless setup
Lastly, modern restaurant technology has made launching catering a seamless process. Olo’s Catering+, for example, is a fully integrated solution designed to help restaurants maximize efficiency and profitability.
Catering+ streamlines operations via direct POS integrations and a single dashboard for managing all digital orders, so you can spend less time keying in orders and more time focusing on guests. With built-in capacity management tools, you can stay on top of high order volumes and provide accurate lead times based on a holistic view of the kitchen.
Furthermore, with Catering+, you can provide a positive and consistent guest experience by enabling them to order catering directly through your restaurant. More direct orders mean more revenue, guest data, and opportunities for your brand to grow.
Ready to grow your business with catering? Learn more about Catering+ and request a demo to see how Olo can help you maximize restaurant efficiency and profitability.
