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How Catering24 Succeeded During the Pandemic12th March 2021
One of the most heavily hit industries during the coronavirus pandemic has been the hospitality industry, with pubs, restaurants and hotels closed for some time. However, some businesses have managed to adapt their offering to cater to life in lockdown by offering delivery and takeaway services. This resulted in a demand for catering supplies and equipment.
We spoke to Ollie Lloyd, director at Catering24, a distributor of catering disposables, cleaning and janitorial products, on how they have succeeded during the pandemic.
Did you have concerns about the success of your business due to the current climate?
I think every business has to assess the risk, but that hasn’t gone away. I believe most businesses still have concerns, purely because of how volatile the situation is. It only takes one government announcement and we could find ourselves either dealing with a huge surge in orders or a heavy decrease in product interest and that’s something we have to be able to adapt to.
Almost a year on from the start of the pandemic, Catering24 is strong and confident in the position that it is in and I believe we’re a better company now because of the operations we have put in place and how we have adapted our service. We have, in our estimation, leapt forward three years in terms of our operational efficiency and the way we work with our customers.
Was your business planning to expand before the coronavirus pandemic?
Growth is an essential part of our business and we’re always striving towards that. Our focus at the beginning of 2020 was around operations and we factored in huge investments to boost that.
We had a pre-signed agreement for the purchase of the software we were bringing into the business, which was signed just a couple of months before the March 2020 lockdown, so that was something we had already committed to and would need to fulfil. Taking hindsight out of the equation, would we have still pressed ahead with this purchase had we not signed a contract that obligated us to? Most likely. It was a huge investment - £150,000 in value - so looking specifically at the bottom line at that time, it was a risk.
Cash was king throughout 2020, but we’re a business that prides itself on pushing forward and managing risk along the way. Aside from that, our other expansion plans were only in the product ranges that we were offering. We’d planned to offer more crockery and glassware options for caterers, but we hit the pause button on that due to nobody being allowed to dine out, while restaurants also immediately stopped buying those types of products.
How have you had to adapt your products or services to maintain business continuity?
Predominantly working as a catering supplier to multiple industries, we saw a huge swathe of our customer base impacted right at the beginning of the COVID-19 pandemic, which resulted in many of them being forced to close their doors following the introduction of government guidance.
Products that we were regularly supplying, particularly to schools and universities, immediately stopped overnight. However, in other sectors, we saw customers and businesses adapting to what was happening.
Businesses began to shift towards a takeaway offering and while Catering24’s range for that was already healthy, we also shifted in order to heavily increase our volume in anticipation of that. It felt risky at the time, given the reactive nature of how decisions were being made with COVID-19, but we managed to pull it off. We analysed the type of enquiries we were receiving and we made a judgement based on the information we had.
It was important that we held a really good relationship with manufacturers and we paid over and above our credit terms in order to secure stock - that gave us a massive advantage within the market.
Are there any measures that you will keep if we ever return to ‘normal’?
Everything that we have put in place as a business during this pandemic will be remaining when the situation returns to normal. We believe we’re a much better and stronger company due to the steps that we have taken.
Online ordering, a new focus on digital, and flexible delivery options have become pivotal parts of our operation over the last year and will remain so moving forward. Even the volume of the stock we order is likely to remain the same and has been compounded by the impact Brexit has had on getting stock into the UK.
We’re seeing huge price increases on the stock that is being shipped from Asia, which has been caused by a shortage of shipping containers. Prior to Brexit, the price of these containers was $2,500. That’s now jumped to $15,000 and it’s arriving with exactly the same amount of product in the container.
What we have done in order to counter those issues is purchase even more stock and increase our holding capacity. That is allowing us to maintain a sensible price point for our customers and the industries we serve.
In your opinion, what is it that has made your products/services so successful during the pandemic?
The way we shifted in our product focus is the obvious choice, but there are other factors as to why it was successful. Due to how reactive the situation was, our customers were wanting to order on an ad-hoc basis. On top of that, they also wanted to be able to order online, purchase as late as possible, not be restricted by a limited order value, and still be able to receive the supplies the very next day. That was key for us and we went above and beyond to offer that service. That was something we were doing before this pandemic, but we’ve elevated it over the last 12 months. We strived to make it more efficient, started working with multiple couriers, rather than just one, and also shifted to offering delivery six days a week, rather than five.
What do you think the future of your company might look like in a post-COVID world?
Digital is at the heart of what we’re doing now, not only when it comes to delivering quality customer service, but ensuring we’re providing convenience. That’s been successful for us and whether we’re operating within the restrictions of COVID-19 or a normal world, that won’t change.
What is the biggest lesson you have learned from the coronavirus pandemic?
It cannot be underestimated how important it is to have a strong staff base. We’ve got an amazing team here and that’s what has driven us on during what has been the most turbulent time in our history. We have a plan in place for the next few years and our staff are right at the centre of that.
What advice would you give someone that is perhaps struggling with their business now?
Be as adaptable as you can and squeeze out every avenue and potential when it comes to sales. For the hospitality industry, we’d advise that any business sees takeaway as an ongoing stream of revenue, as we don’t know exactly what the future holds. When the first lockdown eased and customers were allowed to dine in again, there were some businesses that stopped offering takeaway, despite investing in it. Once you’ve turned off that revenue stream, it’s harder to turn it back on.
There’s a huge opportunity in the hospitality industry for businesses to see up to 50% increase in sales - compared to where they were previously - by having a dedicated takeaway menu that is achievable to host within their kitchen. Every pub and restaurant should be offering it and they’ve got a role to play in elevating that option to a whole new level during 2021 and beyond.
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