Function or Banquet halls provide space and other services such as decorations, food and drink for a party, ceremony, get-together, corporate retreat etc. Function halls typically provide only the space, furniture and cooking facilities. Guests hire the cook separately to make arrangements for food. Banquet halls typically are owned and managed by restaurants, hotels, and they have in-house catering facilities and staff.
What drives the demand for these facilities?
Demand is influenced by the type of event/occasion to be celebrated. Typically, these facilities are availed predominantly by people for celebrating marriages that are typically 2-3 day affairs. However, over the past decade, demand for short duration events such as get-togethers, birthday parties, corporate meetings and sports events has increased as well, owing to greater disposable income and the large demographic dividend. Our primary and secondary research indicates that demand drivers are changing as follows:
1. Demand for these facilities is on the upswing: Increasingly these facilities are being availed by customers of smaller and shorter duration events such as birthday parties, anniversaries, family/class reunions and get-togethers. Corporates/government agencies and educational institutions have also started availing these facilities for organizing events such as office retreats, outbound/annual events, award ceremonies, small conferences/workshops/seminars. Of late, demand for facilities where soccer, badminton and soft sports can be played is also increasing.
2. Distance to the facility is not a big differentiator: Customers are willing to travel some distance if the quality of the facilities are perceived to be good. In fact, people increasingly want a hall away from the hustle and bustle of the city, especially for corporate events, get-together and sports events.
3. Price is not a overriding factor in selection: Customers are willing to pay more for better amenities, including more amenities for children, comfortable interiors etc.
Opportunities for new entrants:
Overall, customers are looking for a venue which could be a one-stop destination for different events. As such, key things to be kept in mind by new entrants for differentiating themselves are:
Incorporating innovative features: Customers are looking for such as theme based architecture, special play area of children, comfortable interiors, music systems and license to play music, in house photography, projectors and screens to display pictures. In addition, customers are also interested in venues that can incorporate soft sports such as badminton, soccer, tennis etc as well.
Focusing on quality of service: Customers want hassle free, one stop services. Venue providers could differentiate themselves by offering services such as pick up/drop facility from nearest station/airport and props for photography/selfie sticks.
Food remains the most important aspect: This is true of any event and understanding preferences and allowing customers to tinker with the menu would go a long way in ensuring loyalty.
Enhanced marketing: Currently, most of these facilities gain customers largely through referrals and paid listing in local directories. Building digital presence, allowing a virtual tours of the facility, posting availability for the next few months, online bookings either directly or through portals that facilitate bookings, and perhaps offering reward points for customer referrals can also enhance bookings.
How we can help?
FineTrain enables entrepreneurs to assess and understand new business opportunities. Our services include market research, and business feasibility studies. We also offer support in implementing your idea by connecting you with professionals who offer project execution support. We can help you assess feasibility of setting up a new event facility in your city, understand customer preferences, analyze the capital requirements, profitability and time to breakeven.
Reach us at:
800 888 4932