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August 4, 2014
Sandy Korem
If you aren't catering off-site, you are missing out on your share of an $8.4-million business. But launching a catering division can be intimidating and costly if you don't know where to start. Trust me, more than 20 years ago when I started my catering business, I had no idea what I was doing.
I started coaching restaurant owners to help them avoid the costly mistakes I made building my business. It’s my company’s mission to help restaurant owners like you reach your catering potential.
Let’s start by covering 10 things you need to know before you tackle catering.
1. Develop a special catering menu. It must be separate and different from your standard restaurant menu. And the prices should be higher. If a restaurant customer asks, "Can you cater my party?" and you give them your restaurant menu, you are setting yourself up for failure and lost profits.
2. Know how much money you are making on each event you cater—to the penny. You must have financial accountability for every bid, contract and catered event that goes out your door.
3. Creativity is essential. It’s important to make your restaurant stand out. It goes without saying that your food should be creative and crowd-pleasing, but many caterers also offer creative event décor, like centerpieces and tablescapes. If you want to offer these kinds of extras, make sure you build it into your costs.
4. Require a nonrefundable deposit to book an event. Even if it's only $300, you will never be sorry.
5. Line item your staff costs, including arrival and departure times. Charge the client from the moment your staff sets foot on the property. I even charge the client for packing time at my kitchen. Present a line-item breakdown to clients so they understand every minute they have your experienced and trained staff at their disposal on event day.
6. Don’t panic . . . punt. You should have a nonkitchen event supervisor who can handle anything. You need a cool-headed troubleshooter who can deliver under any circumstance.
7. Be prepared. I am not trying to scare you, but project the worst-case-scenario for any off-premise catering event and be prepared for it.
8. Create checklists and more checklists. Most of the time special event venues do not have a full kitchen. Sometimes you are lucky if you have water. You must have detailed checklists for all of your supplies and materials.
9. Train versatile staff. I prefer to hire and train staff who can work in the kitchen and on the floor. Cross-training is important.
10. Pay your event staff well. The character and background of the staff are critical. Background checks must be done on all staff going into someone’s home. Your clients trust you have hired the right person to be in their home. And paying staff well promotes loyalty.
We pay our event staff $15 - $20 per hour, captains $24 per hour. Some of our staff members have been with us for more than 14 years. Clients appreciate this level of expertise. We charge the client $30-$33 per hour for each staff member, with increased rates per hour during the holiday season.
Sandy Korem is the c.e.o. and founder of The Festive Kitchen, a catering company in Dallas. Her other company, The Catering Coach, helps restaurateurs and caterers maximize their off-site catering potential and, if desired, establish a take-home catering revenue stream.
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