Building Resilience in Highly Impacted Markets: How One Company Reversed A Challenging Situation
The European foodservice industry was and continues to be one of the hardest hit during the pandemic due to changing government restrictions and fluctuating unemployment levels.
Consumer spending in the foodservice industry was down 14% in December 2021 compared to December 2019, owing to concerns about the Omicron variant reducing worker mobility and cancelling many company events across Europe. However, the industry remains resilient, with consumer spending and visits increasing by 19% and 15%, respectively, when compared to 2020. Despite this, consumer spending fell by €82 billion in 2021, leaving the industry far behind pre-pandemic levels.
With tumultuous change continuing to affect the industry and change the way employees work, how can we as business owners use change to our advantage? We look at Cater Trax to see how businesses can learn from an ever-changing business landscape and come out on top.
What can we learn from CaterTrax?
CaterTrax is a Volaris portfolio software provider that specialises in catering management for the non-commercial foodservice industry. Several of the world’s largest foodservice management companies are among its clients, with a focus on the business and industry, higher education, and healthcare market segments.
CaterTrax experienced a 60% decrease in catering revenue as a result of the pandemic’s immediate impact on its customer base. By leveraging client relationships and identifying opportunities for value-creating pivots, the company was able to reverse a difficult situation and grow in 2020.
How did they do it? CaterTrax shares four lessons that other software companies can learn from.
“We have fluid daily and weekly conversations with our clients,” says Tyler. “We draw on our empathy and humanity when listening to clients and have been thoughtful and flexible in working with them.”
CaterTrax was able to identify and develop several new revenue growth channels, such as takeaway, pre-packaged meals, and grocery services, in collaboration with clients, that aligned with evolving COVID protocols while continuing to support their end customers – including frontline healthcare workers whose hospital systems remained open.
“We’re not rushing to change our name from CaterTrax but diversifying our product offering is a strategic objective and will continue as we exit this crisis. We’ve also evolved our internal operating model quite a bit over the last year,” says Tyler.
Tyler’s advice on making a successful pivot? “Do it without compromising your ability to deliver an exceptional client experience. We invested the time to analyse the impact on our existing architecture, data, and operating models and had a high degree of confidence in our design. There are areas of the foodservice marketplace that we recognize could create value for us but are presently outside our core competency and we will not pursue. We’re okay with that, for now.”
“We suspect, social beings that we are, we’re going to have a business cycle coming where people are eager to get back to the office. In many cases, we are already seeing this trend develop. We’re paying attention and being thoughtful about how we might adapt if a hybrid implementation of a work-from-home model becomes commonplace, but we’re not overreacting. This is the food industry – and food brings people together.”
“The breadth of our client base puts us in a unique position to observe multiple vectors across our market. We want to continue to participate in, lead, guide, consult, and listen as this space continues to evolve,” Tyler says.
1. Meet customers where they are.
The impact of pandemic restrictions meant that catering companies were forced to consider thoughtful alternatives to traditional foodservice channels. CaterTrax worked with customers in the early stages of the pandemic to quickly identify ways to better serve end customers and generate new revenue streams.
2. Think, then pivot.
After identifying areas of potential growth, the company adapted its workflow management software outside of its core niche market of catering, in areas where they knew they could continue to provide support. CaterTrax’s core offering was expanded with the addition of unique modules that were well within the software’s capabilities.
3. Know your business cycle and trend forecasts.
CaterTrax monitors economic data to support business planning and forecasting. Based on previous experience, the company’s closest economic comparison to the pandemic was the 2008 financial crisis, which put the company in the mindset of being prepared for major, unpredictable events while also providing hope for longer-term stability.
4. Develop a thought leadership position.
The company’s service-oriented ethos and expertise meant they were naturally positioned to help customers navigate through challenging times. They saw an opportunity to fill a void in thought leadership during a period of rapid change, such as when health guidance seemed to change every few weeks. CaterTrax regularly publishes blogs on a variety of topics with the consumer in mind, demonstrating their breadth of knowledge and experience across industries.
Remaining Optimistic About the Future
Rising vaccination rates and the gradual relaxation of restrictions across Europe have resulted in significant increases in employment in the food service industry, with figures now higher than pre-pandemic levels. CaterTrax believes that the catering industry will recover. They have demonstrated incredible resiliency by rising to the occasion of adversity. Their diverse business model appears to be poised to emerge even stronger from the pandemic.