Catering Services Industry Profile

The US catering industry includes about 10,000 companies with combined annual revenue of about $7 billion. No major companies dominate the industry, which is highly fragmented: the top 50 companies account for less than 15 percent of industry revenue.

Many food service contractors, hotels, and restaurants cater events, but those businesses are covered in separate industry profiles and are not included in the catering industry.

COMPETITIVE LANDSCAPE

Demand is driven by corporate profits and consumer income. The profitability of individual companies depends on cost controls and effective marketing. Large companies have advantages in offering expanded services such as facilities management, room rental, and entertainment. Small companies can compete effectively by serving small groups and offering personalized service. The industry is labor-intensive: average annual revenue per worker is less than $50,000.

PRODUCTS, OPERATIONS & TECHNOLOGY

Major services include off-premises catering (food prepared away from the premises where it's served) and on-premises catering (meals prepared and served at the same location), each of which accounts for about one-quarter of industry revenue. Other services include alcohol sales and facility rentals.

A typical catering event starts with a consultation with a potential client to assess the type of event, guest count, venue, and special food requests. The client may want the caterer to also coordinate facility rental, flowers, entertainment, and photography. The caterer produces a detailed proposal that includes the menu, beverages, a list of rental needs, special requirements, and a detailed ...