Don’t Get Stuck in the Party Room

A party room at a Yogurt Mill in California.

Why caterers with restaurants should book on-site as well as off-site events

By Sandy Korem, The Catering Coach

In its January 2018 edition, Catering Magazine reported that consumers should expect to see “more venues adding private dining to their business models, as well as more venues building private dining into their establishments. In new build-outs, event spaces will be par for the course.”

This is smart business. Why not increase private event sales at the same time the restaurant is busy? It’s another revenue stream and, as any wise profit-centered CEO will say, you just can’t have too many revenue streams.

I am a member of an elite small group of restaurant owners (I don’t own a restaurant, but food is food is food, and this group has been extremely helpful to me) associated with TheRestaurantExpert.com. I asked several of them to share their “party room” pictures, two of which are showcased above.

Competitive Advantage

If you are a restaurant owner and have an event space, you have a huge competitive edge over some of your catering competition, especially caterers who are not restaurant owners. Here are a few reasons:

During your slow season, you can offer your event room, if needed, at a reduced rate and can easily adjust your catering fees because your overhead is already paid.

During peak times like the holiday season, you can increase your venue rental rate due to demand and increase your profitability.

If bidding for a charity event or an event that you really want to cater, you can still make profit on your food and staff, but comp the venue (aka event space) and become very competitive in the bidding process with other caterers.

This is all great news, but some restaurateurs with event spaces do all of these things—and then they get stuck in the party room. In other words, they book the event room, and then turn down other off-site catering opportunities. “The party room is booked” is a phrase I’ve heard from many restaurant owners, who then don’t pursue any other catering events. This is the wrong approach. If your party space is booked, offer the client a unique off-site experience, such as their backyard or home. What about their lake house? Or suggest an off-site location where you have established a good relationship. This relationship should be reciprocal in that they will refer people to you when their space is booked.

Your ultimate goal for your restaurant and catering business for every Friday and Saturday should be to have a line out of your restaurant door, to have your event space in the restaurant booked, and to have another team catering at least one off-site catered event. During fourth quarter, your event space should be booked every day during the day and evening, and multiple off-site events should be happening every day of the week at the same time. That’s multiple revenue streams in action, making the most of the high-demand season.

Also, one quick note about this extra space in your restaurant. Have you noticed in this article that the venue is referred to as a “party room” or an “event space” and never as the “banquet room”? I can’t tell you how many times I hear that term from restaurant owners. Be honest, when was the last time you went to a banquet and had great food? Me? Never! Banquets are boring. Banquets are for the high school band event. Who wants to go to a banquet? No one! Who wants to pay for a banquet room? No one! In looking at these photos of event spaces, would you dare call these “banquet rooms”? Calling your venue an event space or a party room creates anticipation of good food and fun. I don’t know if there are any studies on it out there, but I’d bet there are more sales for event or party rooms than banquet rooms. The benefit? Anticipation and fun can translate into charging more for that room. Bottom line: Delete the “B” word when selling your party room.

A party room at Niffer’s Place in Opelika, Ala.

What if you don’t have an actual party room in your restaurant but really want to take part in this profit-making trend? Be creative. I recently was in New Orleans and visited a well-established historic restaurant. There was no room for a structured party room, but they had loads of extra space in the parking lot. They built a permanent tented patio to use as their event room. They told me it is always booked.

So, restaurant owner, stay ahead of your competition. Think outside the walls of your existing restaurant, and capitalize on the trend of your own party room while at the same time slam-dunking your competition at off-site catered events by not getting stuck in the party room.