Richard Katz, the startup's co-founder, remembers the stares the first time he pulled fresh-baked bread and brie out of his carryon bag. To the chagrin of their fellow passengers, Katz and his business partner Alan Levin sipped red wine and spread pâté on toast -- 36,000 feet above the Atlantic on the return leg of a trip to Paris.
PERSONAL CHEFS. An airline would hardly serve such four-star fare, but Katz and Levin, a pair of epicureans who had owned a catering company together since 1998, decided to take matters into their own hands. "We got up early and shopped on our way to the airport at all the bakeries and bistros as they were opening," Katz recalls. "And everyone on the plane looked at us like, 'Why didn't I do that?'"
As envious onlookers smelled their goodies, Katz and Levin scented a business idea. With their catering expertise, they started SkyMeals in 2002 to fill the void of airline food with an upscale menu. Items range from brunch packages with fresh-squeezed orange juice and bread flats with goat cheese and aged cheddar, to complete gourmet meals of glazed salmon and vegetable orzo.
All items are packaged with gel ice, delivered to homes or hotels, and specially prepared to be eaten at room temperature or slightly chilled. "We tell people to think of us as their personal chefs," says Katz. "Because, if we can get the ingredients, we'll create anything" -- for a price. Menu offerings range from a single-serving flourless chocolate cake at $5.95 to the four-course fall special for $36.95. Most meals are in the $20 to $25 range.
PROHIBITIVE COSTS. Business has, well, taken off. Since its founding two years ago, SkyMeals has grown to six employees and a six-figure revenue, taking advantage of the new market created when many beleaguered airlines eliminated in-flight meal service or began charging passengers for food on longer flights. US Airways (UAIRQ
), for example, halted free meal service a year ago and now offers sandwiches and salads ranging from $5 to $10. "We were hearing from customers that they wanted quality food service, and this was an affordable way to provide that," says spokeswoman Amy Cudwa.
Right now, the challenge is to convince travelers that they should pay top dollar for a meal they have to order in advance either by phone or online, especially when the masses will probably always find it easier to just grab some fast food while sprinting to their gates. Katz and Levin are hoping to make inroads at the point of departure, once they raise enough capital.
"We would love to be inside airports, but at the moment the political and financial costs are prohibitive," says Katz whose only location is roughly 10 miles from Los Angeles International Airport. "We're a cottage industry here, and there's a reason you only see chains in airports. But we'll get there."
GOOD START. SkyMeals has generated some buzz locally, though "that's still a big challenge," says Katz, who has tried everything from radio and TV spots to print ads in local publications, and finally a PR firm. "But it's the loyal customers and word-of-mouth that we rely on."
The grassroots campaign may be working for now, as customer reviews seem to be very positive. "Not only was my experience a culinary delight, but it helped make a crowded, stressful flight a great deal more pleasant," says Ronald M. Podell, a Los Angeles doctor and repeat SkyMeals customer.
So far, SkyMeals has little direct competition. A La Carte, a San Diego-based catering outfit, rolled out a specialized airline menu a few years ago with similar gourmet offerings and chef/co-owner Diane Biggwither says it has become one of her company's most popular offerings. "It's a nice way to start out a vacation, with the cheese and the wine," Biggwither says.
WIN-WIN PARTNERSHIP. With no policies in place prohibiting travelers from bringing their own food on board major airlines -- Southwest (LUV
) and JetBlue (JBLU
) even encourage it -- the previously non-existent category appears poised for growth. Katz is looking for potential partners and studying costs of real estate and other expansion measures, with hopes of pursuing other major markets like Dallas, New York, and Atlanta in the near future.
Partnering with airlines is also possible strategy. "It's a win-win situation," Katz says. "They don't have the headache or the complaints, and we get the business." And as passengers may eventually discover, once you've had pâté, it's tough going back to peanuts. Chambers is a reporter for BusinessWeek Online in New York