Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 11,600 caterers in the US provide food and beverage services for a variety of events, including weddings, parties, luncheons, and trade shows. Additional services include equipment (tables, chairs, dinnerware) rental, floral/centerpiece design, and event planning/design. Weddings account for about half of industry revenue, corporate events are about a third, and social events are 20%.

Competition from Alternative Sources

Caterers compete with a variety of alternative sources, including restaurants and food retailers, such as warehouse clubs and grocery stores.

Seasonal, Uneven Demand

Demand for catering services can be seasonal and uneven, driven by holiday events and special occasions.

Industry size & Structure

The average caterer operates out of a single location, employs 13 workers, and generates about $1 million annually.

    • The catering industry consists of about 11,600 companies that employ about 154,900 workers and generate about $12 billion annually.
    • The industry is highly fragmented; the top 50 firms account for 15% of industry sales.
    • Some large restaurant chains offer catering services.
                                    Industry Forecast
                                    Caterers Industry Growth
                                    Source: Vertical IQ and Inforum

                                    Recent Developments

                                    Dec 7, 2022 - Multi-Day Wedding Trend
                                    • Caterers are poised to benefit from the 2023 wedding trend toward multi-day celebrations, according to Catering & Food Service Events. Couples planning events that span several days are a growth opportunity for caterers to provide food and drinks from the welcoming party through the recovery party. “Rather than just one night of celebrating, couples are opting for a whole weekend of togetherness,” observed Chris Sanchez of LUX Catering & EVENTS in Salt Lake City, Utah. “People are hosting welcome receptions, rehearsal dinners, daytime activities, the wedding, after-party and post-wedding brunches.”
                                    • Catering companies will want to adjust their drinks menus to include non-alcoholic cocktails, zero-proof spirits, and alcohol-free wine and beer in time for events in Dry January – a month dedicated to abstaining from alcohol as a personal challenge. The annual public health campaign, observed in Europe, the United States, and beyond is growing in popularity. In 2022, food and drink research firm CGA estimated a total on premise sales value increase of $295 million for non-alcoholic beers, spirits, and mocktails, while sales of sodas and soft drinks remained flat. While 7% of consumers purchased a mocktail during the month of Dry January in 2019, 23% reported drinking mocktails in 2022, while 26% and 22% drank alcohol-free wine and spirits, respectively.
                                    • The recession may be slower to arrive than expected. The 2.6% increase in real GDP in Q3 2022, according to the Bureau of Economic Analysis’s “Advance” estimate, suggests the recession has yet to arrive. Still, given the Federal Reserve’s commitment to bringing down inflation with successive interest rate hikes, a recession is not unlikely, wrote Forbes contributor Bill Connerly in October. Connerly, however, doesn’t expect the recession to begin for some time – until late 2023 or early 2024. That schedule would give caterers and the broader hospitality industry time to prepare their event businesses and workforces to weather the looming downturn.
                                    • With the airline industry projected to return to profitability in 2023, air carriers are looking to revamp the in-flight dining experience, with a focus on adding more meatless options to their menus, FN Media Group reported in September 2022. With more than 9.7 million Americans identifying as vegan – and even more people looking to reduce their meat and dairy consumption – many major airlines are introducing healthier plant-based options. As a result of menu innovation, the in-flight catering services market should continue to grow in coming years. A report from ResearchAndMarkets projects the global market for in-flight catering services to reach $21.5 billion by 2024, a compounded annual growth rate (CAGR) of 4.6% over the analysis period.
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