Contributing writer Jim Rand is a seasoned hospitality professional with decades of experience scaling catering operations for major brands. In this four-part series, he shares key insights to help restaurant operators tap into the catering channel for growth.
Catering has become a hot topic in the restaurant industry over the past few years. Restaurant brands are waking up to the fact that the catering channel could be a significant opportunity to increase the top and bottom line.
Interestingly, catering has been an opportunity for quite some time, prior to hitting a significant road bump from 2020 to 2022 during the pandemic. Now that companies are having employees return to the office, restaurant delivered catering is experiencing a renaissance, and restaurant operators are seeking direction and support to take advantage of that opportunity.
Founder, CEO Rand Parker Group
During this series, I would like to take you on a journey that will provide context for carving out your own catering path to success. I will share mistakes made, common misperceptions, a strategic framework, and a roadmap for catering success.
I had my first experience with catering back in 2001 as a Panera Bread Franchisee in Minnesota. There was a demand for our product, primarily from pharma reps and office admins, to feed clients and team members, and we responded by filling the need. We created our own catering menu, added catering sales managers, and began to learn about off-premises systems and processes.
Catering had a significant impact on our team, our guests, and our investors. Sales and profits benefited greatly, and the feedback from our catering clients was fantastic. However, catering created stress for our associates, strained our capacity, and messed with our forecasting and production processes. To the latter point, imagine being a Panera customer stopping in to pick up a dozen bagels on a Friday morning for the team at work, only to find out the shelves had been left bare due to a large catering order. Certainly not ideal for creating the guest experience we sought to deliver!
In 2007 I joined Panera Bread, LLC to lead the catering department, partly due to the success we had with catering in Minnesota. We had it figured out, or so we thought! What ensued was an amazing nine-year journey with a fantastic team of people, learning how to scale catering across thousands of company-owned and franchised bakery-cafes from Boston to LA. From sales, to marketing, to technology, to operations, to delivery, and everything in between I couldn’t have asked for a better hands-on education on how to grow a business from $50 to $500 Million.
So you’re asking yourself, “Why the history lesson, Jim?” What is the relevance of Panera Catering to the opportunity today in the post-pandemic restaurant industry environment?
Well, the answer is fairly simple, and a lesson I learned early on in Minnesota: catering is, has been, and always will be a RELATIONSHIP business. This point was illustrated over and over again as we built the Panera catering program. Relationships are built on trust, and trust is dependent upon being trustworthy. For catering this translates to meeting the clients’ needs. (More on client vs. customer, or guest, in a future article).
And while a clients’ needs may vary based on a specific use case, you can bet on the following 5 critical processes as being at the core of building trust:
- Ease of Ordering
- Order Prepared/Delivered On-Time
- Order Accuracy
- Delivered Quality
- Follow-Up (aka Customer Care).
In his book, Know What Matters, Ron Shaich, the former Founder and CEO of Panera Bread and current CEO and Managing Partner of Act III Holdings, LLC, explains the disciplined approach he used to build, grow, and transform Panera Bread. Having had the opportunity to learn that approach first-hand during my tenure with Panera, our team worked very hard to build:
- A Product Offering that the client desired that was consistent with the Panera Brand
- Capabilities in the areas of People, Capacity, and Technology
- Execution Processes and Systems that were replicable and reduced friction for the client and our team members.
In other words, we had to Know What Matters, and we had to work together to get it done.
Speaking of working together…
Catering is a team sport, and everyone in the organization needs to be on the same page. At one critical juncture in the evolution of Panera catering, the catering/sales team was pushing for House Accounts (aka Accounts Receivable). At the same time, the accounting team was pushing to eliminate said accounts, due to significant issues with debt collection. There was no doubt that offering House Accounts attracted more sales, which increased sales team bonuses. However, when you don’t get paid, it becomes an upside-down proposition.
Ultimately we came up with a solution that satisfied all the stakeholders and fueled our catering growth. While the management of House Accounts is much easier today with the available technology, the point to be made is that everyone on the team; executives, department heads, supply chain, field operations, unit operations, etc. need to be working towards a common goal.
Over the years, working with brands like Panera, P.F. Chang’s, CAVA, and many amazing team members we developed a proven approach for catering success that is both profitable and sustainable over time. This approach consists of a Strategic Framework, Strategic Initiatives, and Tactical Solutions that drive sales, satisfy clients, engage team members and result in incremental profitability.
In this series, you will learn:
- How to create a Strategy to integrate your Catering Offering, Capabilities, and Execution
- How to implement Strategic Initiatives that matter, and move the needle on sales and profits
- How to create a cycle of success using replicable Tactical Solutions that are sustainable, and build upon the RELATIONSHIPS that are so important to long-term growth
Catering is a large opportunity for many brands. If you are interested in and committed to, making catering a significant part of your growth initiatives for years to come, please join me on the Catering Journey!
