FSD 2008 Catering Study

Innovation and diversification could be key to non-commercial caterers surviving 2009.

How did non-commercial caterers do during the last year? What does the new year hold for them? What are the major challenges and opportunities as these operators battle their commercial counterparts for a share of the stomach in this competitive field? FSD's survey shows that innovation and diversification could be key to non-commercial caterers surviving 2009.

A slumping economy means non-commercial operators who offer catering will have to work harder in 2009 just to keep pace with 2008. At least, that was the view on three college campuses in different sections of the country as the holiday catering season wound down. As a matter of fact, one operator frankly was surprised that 2008 turned out as well as it did.

“To tell you the truth, I had been thinking that our business was really down from last year, which was a record year for us,” says Abbot Albright, catering administrator for Dining Services at the University of Maryland. “Then I saw our recent P & L statement, and we are almost even. I do think, however, after the inauguration is over we will see a severe downturn. There are regularly scheduled events, such as football and family weekend, which people will attend. However, the extras such as off-campus clients coming in, or weddings at the Alumni Center, are simply not there.”

Albright predicts that business will decline as “state budgets clam up.” He also believes check averages will shrink for weddings and other special events.

Across the country, at the University of California at Berkeley, Shawn LaPean, director of Cal Dining, says his department’s catering business also has stagnated.

“We are seeing our business, which was building at 15% to 18% per year in revenue flattening out this year, to where we think we will only have sales that match last year,” says LaPean. “Most clients are not asking for the bells and whistles this year and instead are turning to simple lunch events versus expensive dinners. Everyone wants ‘austere.’ They are afraid to have events that look too fancy.”

He added that the percentage of clients who are asking for what he calls “freebies”—reduced rates or free decorations, for instance—has grown from 20% to as much as 70%.

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