2021 State of the Industry, part 1

Editor's note: This is part 1 in our 2021 State of the Industry that will be published weekly.

It has been quite the year, hasn’t it? We all stepped into 2020 with a great deal of confidence and enthusiasm, only to have it dashed. 

To that end, in October, Catersource sent out a survey to its readership and show attendees, to determine the current status and health of the industry, as well as gather thoughts on the impact of COVID, thoughts on diversity and inclusion, and willingness to travel. 

But first, I’d like to begin with a burst of forward-thinking optimism. 

Mask wearing during the pandemic in the early 20th century. Photo by Keystone/Hulton Archive/Getty Images

In 1918–1919, an influenza pandemic caused by an H1N1 virus spread worldwide. It is estimated that one third of the world’s population (according to the CDC) became infected with this virus. 

And yet, what happened after the pandemic? The opulence and over-the-top decade of The Roaring Twenties from 1920–1929, replete with surging economy, a cultural edginess that gave birth to the Jazz Age and the Harlem Renaissance, and the passing of new political freedoms! Parties, despite Prohibition, were legendary. 

What I’m saying is that despite everything, we must choose optimism. The catering and events industry will rise again, and we will thrive. We are resilient.

Guests dancing in the ballroom aboard Cunard liner ‘Berengaria’ at Southampton Docks. They are attending a dance and cabaret to raise funds for charity. Photo by Puttnam/Getty Images

So, let’s begin, shall we?

First, about those who responded to the survey:

The impact of COVID on our businesses

This is not going to be a pleasant section to read, so let’s just get it over with, OK? The first question I asked, related to COVID was:

Do you agree that the COVID-19 pandemic represents the most severe challenge your company has ever faced?

Essentially, 98% chose an answer that leaned more toward yes than no. That is really a strong “yes” statement, especially for those companies who have been in business for decades and made it through the recession, 9/11, even fires that destroyed company headquarters. Only 2% said, “no.” No, this is not the most severe challenge my company has ever faced. 

Chef Kathy Casey presented two types of contained beverages at Catersource in March 2020 that would become even more trendy than expected: the bottled and (shown) bagged cocktails. Photo courtesy Kathleen Stoehr

Regarding catered events

Most of us experienced event cancellations, reschedules, or that the deposit provided for an event was now enough to pay for the entire event, with greatly diminished “attendance.” I asked those surveyed to report on their events between March 14 and September 30, 2020.

What does this mean? Essentially, with 58% of events cancelled in 2020 and 26% rescheduled into 2021—caterers have been operating on about 16% of the revenue they are used to, and even that pittance is no doubt diminished given that many events had guest counts cut to the base minimum, depending upon state mandates.

Regarding revenue, and pointing directly to March through September only, respondents estimated that revenue decreased by 76% YOY.

Drive in events in the summer months became an ideal means to bring people together—but distanced. Photo courtesy Luxury Wedding & Events

Regarding number of events, respondents estimated that they would complete 75% fewer events in all of 2020 versus 2019. 

Regarding deposits on events, 50% noted that they returned all deposits with no holdbacks or held back a certain amount for costs already incurred.

Finally, let’s look ahead to the rest of Q4 and into 2021.

Bookings are 85% “worse” in Q4 2020 than they were in 2019. Forward bookings into 2021 compared to the same point the previous year (end of 2019 and Q1 2020) are 54% “worse” than the prior year. And, about half of respondents say it’s unclear if 2021 will be busy because potential clients have been in a “wait and see” mode. Comments:

Check back next week for part 2 of our State of the Industry.