Catering The New Growth Model For Restaurants

In the United States alone, catering has grown into a $60 billion market—making demand generation essential to every restaurant and industry operator’s marketing strategy. Of that $60 billion, $24 billion is concentrated in business catering. And some brands are feeling the pressure to broaden their digital and marketing efforts to keep consumers coming to their door.

On this episode of The Barron Report, host Paul Barron chats with David Meiselman. Meiselman is the chief marketing officer for ezCater, the world’s largest online marketplace for business catering. The company works with over 62,000 restaurant and catering partner locations throughout the United States.

According to Meiselman, studies show “that 70 percent of catering buyers want delivery with their order, but only about 44 percent of catering orders are delivered.” With ezCater, he adds, “about 97 percent of the orders that come through our marketplace are delivered.”

For ezCater, the mission is simple: partner with dependable, high quality catering partners to help connect restaurants and operators with their current customers while also building that base. The company utilizes three online platforms—ezOrdering, ezManage, and ezDispatch—to accomplish this goal. Business class catering and delivery is provided via a network of local couriers and companies. Membership is free and there is no cost to be part of the marketplace itself; ezCater simply takes a small percentage of each order from the restaurant.

“The catering business is growing 50 percent faster than the overall restaurant business,” notes Meiselman. And ghost kitchens are part of that growth: restaurants are maintaining one flagship location while adding a number of ghost kitchens in surrounding areas to expand their reach. Such expansions ensure that customers receive a consistent delivery experience.

Listen to The Barron Report episode above to learn more about what makes the catering business unique and how the movement toward online ordering may help restaurants and operators focus on doing what they do best: making great food. And if you would like to keep listening, check out The Barron Report podcast on iTunes Now!

Produced by:

Paul Barron

Paul Barron

Editor-in-Chief/Executive Producer


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NYC Council Investigates Third Party Delivery Companies

This past June, the Small Business Committee within the City Council of New York conducted a hearing regarding third party delivery business practices. The investigation, entitled “The Changing Market for Food Delivery,” is arguably the first of its kind. The hearing endeavored to address the growing tensions between restaurant operators and third party delivery companies.

“New York continues to be a trailblazer,” said Committee Chairman Mark Gjonaj. “I’m proud to be part of this historic moment.”

Restaurant operators hope that the hearing will kindle new government regulations that better protect the needs of the industry. According to Robert Bookman, counsel for the local industry trade group New York City Hospitality Alliance, “We’re calling for both the federal government and the state attorney general to look into this matter.”

The Small Business Committee called on restaurant operators, third party delivery companies, and various trade groups to share their practices, concerns, and complaints. The hearing was open to the public. Discussion ran long, and largely focused on rate structures, questionable fees, and the future plans of third party delivery companies.

The difference in perspective between the restaurant operators and the third party deliverers was considerable. Operators like Robert Guarino, the co-founder of 5 Napkin Burger, argued that delivery companies have every intention of moving toward discarding restaurants and offering their own meals for delivery. Third party representatives emphatically denied this claim.

Andrew Rigie, the executive director of the Hospitality Alliance, provided the council with an extensive list of questions for third party deliverers. Some of the questions addressed:

  • If financial factors don’t determine where a restaurant is listed on a third party’s app, what variables do? How can restaurants be safeguarded against erroneous fees?

  • Who owns the information on a restaurant’s customers who order through a third party, and what happens to the data if the establishment pulls out of the arrangement?

  • Does the prominence and penetration of the big third-party delivery services constitute a restraint of trade?

Restaurant operators appear to universally agree that third party delivery companies need to interact with restaurants in a clearer and more transparent fashion, and third party representatives at the council pledged to provide that. Next steps for both sides of the industry, however, remain unclear.

Building a Menu That Differentiates Between Takeout, Catering, and Delivery

On this episode of The Takeout, Delivery, and Catering Show, podcast hosts Valerie Killifer and Erle Dardick chat with Tad Low to discuss the importance of menu differentiation within off-premise.

Tad Low is the Director of Off-Premise for Moe's Southwest Grill, an Atlanta based fast-casual restaurant chain with over 725 domestic and international locations. Low is leading a team that is working to bring delivery to the forefront of the guest experience.

When it comes to maximizing opportunity with off-premise, Low credits Erle at helping him understand the importance of recognizing the different revenue channels that exist within off-premise.

“We really have four main channels of revenue here. We have our in-store business, we have our catering business, we have our online business and we have now our third-party business. And understanding that each part of the business while representing a different percentage of our overall sales they each have a different impact to our bottom line,” says Tad Low. “And understanding that in order to maximize each of those channels we probably need to have a menu that is geared towards each of those segments.”

Learn how each menu for Moe’s Southwest Grill’s different revenue channels differ from each other along with more tips for off-premise success by listening to the podcast episode above!

Vanessa Rodriguez

Vanessa Rodriguez

Writer & Producer


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Is The Future of Dining Digitization? Allset CEO Thinks So!

We are living in a world with a live and thriving “on-demand” economy.

From having the choice to watch your favorite TV shows on your own time and schedule, to ordering meals and groceries through your mobile phone or online.

Companies seem to have finally figured it out…

Time is of the essence!

People seem to be willing to pay for their precious time to avoid time-consuming, mundane tasks. And with so many efficiencies taking place in different aspects of people’s lives, consumers are getting accustomed to speedy services so they can get back to what’s most important to them.

This phenomenon has us thinking… Is the future of dining digitization?

On this episode of On Foodable Feature, we learn from Stas Matviyenko, CEO and co-founder of Allset—a San Francisco-based application that aims to help restaurants provide a more efficient dining experience to guests who are short for time.

Watch the full interview to learn how this app can help increase a restaurant operation’s bottom line, how the technology integration would look like, and costs associated with the service!

Have Amazon Go and UberEats Become a Threat to Restaurant Operators?

Operators have always had to compete in the market with other concepts, but in today's market, there are a new set of power players ready to steal your customers.

Enter Amazon.

Amazon, like the fast casual segment, is catering to the on-the-go consumer with its cashier-less Amazon Go stores, many of which offer grab-and-go food options. These stores have become the most popular during the workweek, especially at lunchtime.

We recently analyzed the aggressive move Amazon is making in the foodservice industry. Listen to this episode of The Barron Report for more insights on if fast casual restaurants can survive this threat.

But there is one advantage that restaurants, namely fast casual restaurants, have over the Amazon Go stores– many have embraced the plant-based movement. According to Foodable Labs data, today's foodies can't get enough of these plant-based menu items.

Don’t miss our video breaking down this data about the plant-based movement below.

Amazon isn't the only threat operators need to be worried about. There is another shark circling to take a bite out of your business.

Third-party delivery services emerged as a solution that many operators desperately needed.

Since offering delivery has quickly become a guests' expectation, an operator has two options. One is to invest in significant funding to build a delivery program. However, this is easier said than done. It entails creating a system, investing in a platform to process these orders, hiring more staff to handle take-out and delivery orders, and then hiring reliable drivers to deliver these orders.

Or an operator can simply partner with a third-party delivery service, which eliminates most of the headaches. When you consider the operational and logistical challenges of offering delivery, its no wonder that operators across the country have decided to go the route of partnering with a third-party delivery service.

But now this has created a new problem.

One of the most popular delivery services out there is now UberEats. This company has quickly conquered the market. UberEats is currently offering food delivery for 50 percent of the U.S. population and has the lofty goal of serving 70 percent of the U.S. population by the end of this year.

As UberEats becomes more popular, the more the fees increase for the participating restaurants. Could this be correlated to the increase in restaurant closings?

Listen to the podcast above as The Barron Report host Paul Barron explains the data showing that third-party delivery growth may be tied to restaurant failures.