Many people dream of quitting their “day” job and becoming their own boss. A party catering business is often a popular choice for people who enjoy preparing and serving food to other people. But there is more to this than simply baking a few cupcakes for a neighbor’s birthday party. Careful planning is required before any business can get off the ground. In this article, we shall be exploring the basic 6 steps to starting a catering business.
The truth is that starting a party catering business is no different than any other business, so preparing a business plan is recommended before you fire up the oven.
A business plan in place is your road map to success. It is your guide for getting the business off the ground, steps for expansion, and how you will exit by selling it if you so desire for boatloads of cash, allowing you to retire to a relaxing, remote location.
A business plan is also how you will secure money for your company whether it be through private investors or through bank loans. The business plan should include: business name, which your customers will be, where your customers will come from, catering and beverage menus, staffing needs, staffing costs, purchase costs, rental costs, insurance costs, projected income, unique selling points, mission statement, market facts, marketing plans, growth plans and contingency plans for down times.
All of this research takes time, effort and energy, and all are necessary before you can begin serving customers. Here are 5 crucial tips every work at home business moms must consider in order not to fail.
A key decision to make before starting a party catering business is whether yours will be home based a mobile, or a fixed location business. Each has its own benefits, its own downside and set of liabilities, and its own costs or cost savings.
The type of catering business may also affect your unique selling points – that is, what makes your catering company different from all of the other catering companies in your area. It may be the type of food you serve, it may be the manner in which you serve it, or it may be your amazing customer service.
Your pre-startup research should also include ways to understand your client’s needs. When trying to start a new party catering company among the many already established in your market, you’ll need to strive not only to provide the best menu in town, but to go the extra mile with your clients.
Word of mouth advertising is not only the cheapest form of advertising, but it is also the most effective.
Many potential customers will ask around among their friends and colleagues before hiring a caterer for a party or event. Therefore, providing incredible customer service to all your clients will ensure your catering company’s name is on the tip of their tongue the next time someone asks “Who do you recommend?”
Naturally, careful planning is required when entering any business venture and starting a party catering company is no different.
But all of the planning in the world does no good if your menu isn’t excellent and your service isn’t spectacular.
Here are 6 Steps To Starting Catering Business For Beginners:
Going the extra mile to provide what your customers want, especially in the beginning can quickly catapult your party catering business to success.
1. Find your specialty
It is important that your catering business fits into a specific niche, such as specialty cuisine catering, corporate wellness catering, event-specific catering, mobile catering, personal chef services, meal delivery services, party platter services, food truck business etc. And it becomes easier to build up a solid base of repeat clients through word of mouth marketing.
• What type of food will you serve? Will you serve everyone?
• What types of functions will you serve?
• What’s your capacity?
• Who’s going to do the work?
2. Investigate local licensing and permits
Licensing and permits for catering business varies according to your location. There are some places where you may not be allowed to prepare meals in your personal kitchen, and with equipment you also use in preparing your personal meal.
Just get in touch with your local health authorities to learn about licenses and permits that pertains to your catering business.
3. Create your menu
If you love food and you’re already thinking about starting your own catering business, no doubt you’ve stayed up late at night dreaming of the magnificent meals you’ll serve.
Now that you have done the required research, answered some vital questions about your business, and obtained the needed licensing, it is time for you to write a rough draft of your kind of menu.
4. Get ready to buy equipment
Depending on the scale of your catering business, and your expected customer size, prepare a list of all the items you will be needing to get up and running.
5. Create an affordable marketing strategy for your catering company
Luckily, you don’t need to buy a Super Bowl ad to get the word out about your catering business. A few inexpensive techniques can do the trick.
Keep menus and prices fresh
If customers are looking up your business, chances are they’re already thinking about having an event catered. That means they want to know what kind of menu you offer, what kind of events you cater, and how much it will cost.
Keeping menus and price lists up to date on your website helps your customers start planning before they even contact you. A couple planning their wedding would rather know if your services are in their budget before they contact you; offering price ranges up front could mean they choose you over the competitor whose website still says “under construction.”
Curate your reviews on social media
A social media profile with recent reviews proves the lights are on—you’re an active, popular business. Encourage customers to leave reviews, and be sure to address any negative ones; it’s often better to offer a refund to a customer with unrealistic expectations than to suffer the damage to your reputation caused by a one-star review.
Post yummy food photos
Pictures of the dishes you’re most proud of can get social media followers’ mouths watering, and show them you know what you’re doing when it comes to presentation. Occasional food photos are a great, low-investment way to keep your social media up to date.
Be warned, though: An unattractive photo of your cooking is worse than no photo at all. If every photo you take looks like a public warning poster about food poisoning, you may want to enlist the help of a professional.
Word of mouth marketing is your best friend
Good, bad, forgettable—whatever kind of experience a customer has with catering, they’re only too happy to share it by word of mouth. The best thing you can do is make sure your customers have good things to say about you.
One way to do that is by providing exceptional service, every time. The other way is to offer referral deals. Maybe if a customer refers someone, they get 15% off their next order—or fresh-baked breakfast muffins and coffee for their office, as a way of saying thank you. Building and maintaining good relationships, as well as incentivizing referrals, will grow your clientele faster than any print ad or flyer.
6. Choose a business structure
Your business structure determines how your catering company will be taxed, and also your level of personal liability when it comes to debts and legal proceedings.
As soon as you go into business for yourself, the IRS automatically considers you a sole proprietorship. That’s great in terms of ease—no forms to fill out, no business structure to elect. But it’s not so great if you can’t pay your debts, or someone decides to sue you.
The next step up from a sole proprietorship is a single member limited liability company (LLC). An LLC functions a lot like a sole prop, except it sets up your business as a separate legal entity from your individual person. Meaning, you get more liability protection than you would with a sole prop.
To see all the business entity types you have to choose from, and how to elect each one, check out our guide to business structures.