Catering: Easy money or logistical nightmare? Does it make sense to expand to offer catering through your restaurant? Read on to discover some of the pros and cons of expanding your restaurant’s offering to include catering.
Without catering, your restaurant relies solely on walk-in traffic. Inevitably, this traffic can fluctuate with changes in season and even school year, depending on your location. If you expand to catering you don’t put all your eggs in one basket, so to speak, so despite changes in walk-in traffic, you’ve still got other ways to draw in business.
If you’ve had your restaurant open for a while now, chances are you have some regular clients. Again, depending on your location and visibility, you may have quite a bit of newcomers as well.
When you decide to add catering to your restaurant, your existing customer base has a new way of engaging with your business, and you’ll engage with and bring in new customers at every gig. When in need of catering, customers want to know what they’re getting. Having a storefront and existing reputation makes you a preferred choice over catering companies who they are unfamiliar with.
If you have slower business times – whether it’s seasonal, a certain time of the day, or certain days of the week – you can advertise catering to fill in those gaps. For example, if your weekdays are slow, reach out to event venues and corporations in the area and offer your catering services to them for team lunches or special events. Catering around the holidays could be an excellent option for customers who are hosting but don’t want to cook.
Another amazing perk of expanding your restaurant to catering is that it allows for a variety of delivery styles. Depending on the client’s needs, you could offer food buffet-style, sit-down, multiple stations, or they could simply pick-up the food, set it up, and serve it themselves. This, of course, is priced accordingly and gives you another way to increase your revenue. Along with a variety of service-style options, you could customize your food options as well to include premium cuts of meat or specialized seasonal offerings.
Nothing’s harder than having to let go of employees because there isn’t enough work for them. It’s even worse when employees leave on their own in search of something better when business slows, then having to frantically rehire when business picks up again.
Catering doesn’t just provide you another income stream; it provides your employees with another way to make money when business temporarily slows in the restaurant. If your employees get consistent and dependable work, they are less likely to leave in search of it elsewhere. Plus, leaving the regular workplace or cooking different options offers a nice change of pace that employees enjoy.
When adding an entirely new component to your business model, you are inevitably adding more complexity to your business. Because of the benefits, this could be a welcome change; however, if you are still ironing out some critical kinks in the general daily operation and processes of your restaurant, adding another component could be detrimental to your business’s well-being.
You would know best if this is the case. Does service flow smoothly during daily operations? Do you have a solid team? Do you have systems in place for inventory, scheduling, ordering, serving and cooking that are working? Are your existing customers happy?
When you decide to expand to catering, you may need to hire new employees. Whether you decide to make do with the employees you have or you hire out just for catering, there will be a learning curve while everyone gets adjusted to the new system. That is why it is critical that your restaurant has a working system in place for existing business; you don’t want your staff neglecting your restaurant orders while attempting to complete what needs to be done for catering orders.
Since you’re offering something new, you’ll need to get the word out. Marketing material and catering menus need to be created and staff needs to be trained on how to handle catering orders. Inventory and food costs will need to be recalculated considering bulk pricing and orders.
Your time will likely be needed during this adjustment period. Teach your staff how to discuss the new offering, and make sure your marketing material is being shared with to-go orders, on tables and menus, and when customers get their check. Social media is also an excellent way to inform your customers. Take photos at your first catering and share them to show your customers what you can do.
Depending on how much catering business you get, you may consider investing in catering-specific tools and materials. You may even find that you need a vehicle. Crunch the numbers and be prepared to make some initial investments so that you’re ready when business comes knocking.
Depending on how you chose to structure your catering service options, you may have employees who need to drive to events, set up, serve, and break down. That means that your employees will represent your company while working in spaces and homes that belong to your customer. Anything can happen from a minor burn to major damage to a customer’s property. Be sure that your staff is fully trained on how to handle sticky situations and call your insurance company to make sure you’re covered.
Think of how much of your kitchen space is needed for day-to-day operations. Now think about sharing that kitchen space with catering orders, too. When considering catering for your restaurant, think about how it’ll work logistically with the space you have. Many catering-only businesses operate out of a commissary kitchen that they dedicate to catering, and they don’t have to share the space with a team that is focused only on individual orders.
Things could get tricky. Staff may need to work after hours so as to not get in the way of general operations, and if they work alongside the line cooks you risk lessening the quality and speed of restaurant orders. Consider this balance and if you have the space – and bandwidth – in your kitchen.
Don’t be intimidated by the list of “cons” presented here. They are simply addressed so you can rest assured that you are prepared to take this next step in your business. Adding catering to your restaurant can provide a healthy income stream. If you have the space and bandwidth, catering is definitely a good idea and will provide an additional valuable offer to your customers. If you’ve weighed the pros and cons of expanding to catering and you choose to move forward, best of luck! With all your bases covered, you’ll be up and running in no time. Your customers and community will thank you!
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