How do we move from restaurants to our own catering biz?

[nellopea]

My husband and I have about 32 years combined professional cooking experience, mostly upscale dining. He's an exec. chef of a small boutique restaurant and I'm a pastry chef at a big hotel restaurant. We're ready to open our own catering biz together and feel we've got all the cooking experience we need, but not the business end stuff. We know we'll have to keep our regular jobs and do this on the side for awhile. How do we get started? We're in a major metroplex and know our geographic location can support another small caterer. We'd like to start buy renting another kitchen since we don't have a bricks and mortar place of our own, and we know we'll need to purchase some small equipment. Assuming we're going to start with events of 100 or fewer people, what equipment should we start with? How do we get our name out there and what are some of the pitfalls we can expect to face? Can two people realistically start a business like this? Would love to hear stories of how other caterers got started.

[Edward J]

1) Liablity insurance, 2-5 million should do it.

2) Contract form. Spend as much time and money as possible on this. Your contract should state the terms and conditions of guarantee head counts, extra guests, no-shows, cancellations, percentage to book a date, percentages for 1 week prior to the event, and percentage to be paid on site BEFORE the event. Get a lawyer to draw it up. After 13 years in the catering business I can honestly say this will be the best fitting pair of brass-bound, titanium-clad underwear you'll ever need.

Equipment?

Some kind of a mini-van or van. This can also be your regular personal transportion

Stacking bread trays. I operate like this, and I can fit alot of party trays into stacking bread trays. DO NOT use a rigid shelving system in your van.

A very good trolley. Get one with welded steel tubing and pneumatic (if possible) wheels. A cheap trolley with cheap wheels will catch on cracks, elevator thresholds, etc and you will be sorry, very sorry...

Cambros. I like the 300 mpc, and at one time had 6 of them. These are ideal for moist hot foods, but NOT for anything crispy. They can also be converted into coolers with the optional Cambro Icepack. I transport my wholesale cakes and pastries this way too. They also do double duty as "retarders/proofers" in my kitchen, as they are air-tight so any yeast products don't need oiling or covering and won't skin over.

Coffee........If you invest in coffee cambros and a coffee service for say, 80 pax, you should make your money back after 3 events.

I have listed what I feel is most important, please note my order, and what I feel is vital. Smallwares and the like can be bought at auctions or new, and are very easy to come by (didn't say cheap, but easy to come by).

Good luck, and don't work too much!

[KarenDW]

Insurance

Business Plan

Line of Credit from your bank ")

All my admin work is done at home; most cooking is done in the clients' facilities (i.e., their home) or a rented commercial kitchen. Something that has worked well for me is working for a church with an under-used commercial kitchen (health board approved!)

Check out business courses in colleges in your neighborhood, or check the library for a book, "Start and Run a Successful Catering Business". Then check the regulations/rules in your region vis a vis food businesses and home-based businesses. You may need to rent off-site storage for your gear; if so, look for one with late-hour access.

I rent a van when I need to; my personal car is a 20 yr old Honda sedan. I maintain a list of good people who are available to work random shifts, on short notice. Also, get to know the party rental companies in your neighborhood, and any regions where you think you'll be working.

oh, and maybe some coolers and re-usable ice packs?

Edited August 9, 2010 by KarenDW (log)

[AAQuesada]

You must have industry contacts in catering. I would highly recommend getting in on a few event to really get a feel for the differences. As a lot of questions. The cooking is the easy part.

[nellopea]

Thanks Edward. You offer some things I hadn't considered, like insurance and contracts. See, we are completely ignorant of the business side!

[nellopea]

I hear you on the the 20 year old Honda. We're just beginning to look for catering wheels since his motor bike and my 16 year old coupe won't cut it.

So did you have help with writing your business plan?

[KarenDW]

re: business plan

I had a lot of help, thanks to a Canadian government program to help people start their own businesses. The Self-Employment program was delivered by a local college, and consisted of courses in accounting, marketing, advertising, finance, and business plan writing! The bus plan is an important document in securing credit, not to mention keeping you on track, business-wise. The act of preparing the business plan will likely help you to solidify your actual work needs, and path to success. Or, you can start by checking out some on-line resources.

When deciding to start my business, I chose the route of Personal Chef, as this does not require me to maintain an off-site kitchen (i.e., lower overhead). I'm a member of the US Personal Chef Association; they offer business courses and support for start-ups, too.

[Edward J]

So, the big question is, do you want to go "full blown" catering, or just p/t / weekends?

If you choose p/t, sooner or later your regular work and your catering will clash--big time.

Your plan will estimate your projected earnings, fixed costs, and equipment outlay for the next few years.

We focused on "bread & butter" catering, that is, corporate stuff, M-F, and we had our own commercial kitchen to work out of. I did all the cooking and everything else, Jane did all of the sales, and it was a good partnership.

The sales are where you will have to put all of your energy into. One of Jane's best tactics was to make appt.s with law firms, investment co's, etc. and show up to the Office Mngr with a "sample tray". These were good bread n'butter accounts, and while they took a lot of effort to secure, they paid off years after the first inital visit. One time events suck up alot of time and energy and it's not guaranteed that you will get repeat business.

Networking helps a lot, as does trade shows, and of course, websites and brochures. These are all time consuming methods, but pay off for years and years.

Check out/google "Caterplan" for ideas and information.

[KarenDW]

You must have industry contacts in catering. I would highly recommend getting in on a few event to really get a feel for the differences. As a lot of questions. The cooking is the easy part.

The cooking is definitely the "easy part".

If you are work in a few other companies' events as an employee for a while, that would help with gaining the "catering" part of the business experience. I was working p/t for a large caterer (100 times bigger than me!) and a restaurant for about 2 yrs while I launched my business. Neither organization objected, and they both provided great contacts, and helpful advise.

[MarkIsCooking]

Lots of great points here!

Consider these:

> If you're anywhere near a business school / college, you can sometimes get students to help you draft a solid business plan as part of a school project. This way you not only get some free energetic help, but you get their professor to look it over and critique it as well.

> I totally agree that focusing how you'll generate sales - and service those customers from the 'front of the house' point of view is very critical. Catering is a hugely broad term. Exactly what are thinking of? Are you focusing more on corporate catering (lunches, corporate functions and stuff like that)? Are you thinking more about private parties from ramped up in-home parties to weddings, bar mitzvah's and the like? Menu building, marketing and delivering on these different types of things can really impact many aspects of your planning.

> Think through how much capital you'll need and how you'll find it. Most new businesses fail due to lack of capital to survive a ramp of period (which can be quite a long time in some businesses). The good news about certain types of catering is that the cash flow is extremely good. My old company would take deposits in such a way that all our pre-party out-of-pockets were covered by the client.

Best of luck!

[rlped]

Random thoughts.

0) Know your costs. Have good insurance. Charge for everything (or show it as a no charge item on the bill for PR sake). Some business you do not want: Let someone else fail to meet the client from hell's unreasonable expectations.

1) I have found craigslist to be a good source for sourcing about rental kitchens and also used equipment and smallwares. Also for local farms that have product that can help differentiate your work from those that only buy from the bulk suppliers.

2) Your job is to make your client (that is the person that signed the contract) look good to their peers or friends or guests. Your client would probably love to tell their guests or co-workers "These tarts are made with Raspberries from the valley." Or whatever. People LOVE the provenance of food, and the organizer will get good cred if you make them look good. And they'll tell their friends. Of course you already know this.

2) Focus. Doing weddings? Then do the wedding shows. Get to know the wedding planners in your area, the halls typically used for weddings, the florists, the dressmakers. By Get To Know I mean don't just drop off a business card and rack card. Feed them. Feed their staff. Keep in touch. Doing business catering? Office managers are the people you want to know. Get some face time. Ask who they use now. How do they like them? Any suggestion they would give someone trying to break into the business? Then send something good to eat as a follow up in a month.

3) One local caterer does a booth at the farmers market with products highlighting local ingredients. Hand out recipe cards with your catering info on the back.

4) Get on Google Local - even if you don't have a street address you can get a local listing. Have a website with useful information such as suggested menus, and quantity estimates (many people hiring a caterer are not very knowledgeable, so help them be a success).

5) Your local community college may have a culinary school. A great source of part time help.

6) Take pictures. Put them on your website. Put them on your Facebook page.

7) Sleep now. You wont have time when your business takes off.

Good luck.

[ruthcooks]

I found it quite easy if I used my restaurants in promoting. If people have tasted your food and liked it, they will come to you and ask if you do catering. Put "Catering" in your restaurant ads. Having a restaurant is a good time to promote a cookbook, also.

[Malawry]

The element of catering that I did not anticipate when starting out was the headache of rentals. Figuring out what we'd need, how it would fit into a vehicle for delivery, how it would fit in the space, how we'd move them around, how we'd process them, how we'd control the costs--all of it was a nightmare. Cleaning rentals, in particular, can be pretty awful if you don't have a plan in place. I've been catering for 5 years off-site and it's still one of the hardest parts of the job for me.

If you're planning to do only dropoff/corporate type catering or if you have your own venue, there are other logistics that replace the rentals issue. I'm a really small biz and I still don't own much stuff--it doesn't seem worthwhile to invest in things like wineglasses or forks at this point in my growth. I only invested in my business as I started earning money. I even rented my chafing dishes for the first year or so. I've never borrowed money from anybody besides myself, and I pay off my credit card bills in full each month. You don't have to invest $1000s to get started--although if you expect to make a living quickly, you may be better off doing so. (My business was more like a hobby for the first couple of years. I now earn a tidy living, though.)

I wish I'd known more about managing rentals before I started doing it. I relied heavily on a friend who used to run a successful catering business to guide me through my first few gigs. Try to enlist such a friend, or spend some time working for off-site caterers if you'll get into that sort of work to see what it's like. Also, try to learn as much as you can about a venue--visiting if you can--before you start writing a contract or proposal for a client. There's a world a difference between a hall with a 7 hour rental window--4-5 of which are taken by the event--and somebody's house where you can deliver and take away at will. There's an even bigger world of difference between catering in a field with no electricity or running water and catering someplace indoors with a full-service professional fully-equipped kitchen.

Personally, I enjoy figuring out the logistics of these sorts of issues--and I learn something new from every single gig. Sometimes it feels like we're reinventing the wheel every weekend, but through experience we've gotten pretty skilled at it. You will too.

[howsmatt]

I made a deal to work out of my employers kitchen. He gets a cut and we both have a chance to earn more business. For example I am able to do tastings at the restaurant. It's a great deal for me because I have started the business with 0 overhead and risk. I can continue like this or when I get busier decide what to do next. It is almost impossible to calculate how many extras I don't have to worry about working out of an already stocked restaurant--but here are some examples anyway:

I get terms with my food orders and good prices

I sell back unused items to the restaurant at cost (for stuff on their menu)

I can grab something I forgot or don't need a full case of

Small things like take out containers etc. (again much cheaper when buying only what I need).

Anyway you get the idea and most restaurant owners are happy to make extra money without having to provide extra staff. Sure there is a clash here and there but usually it can be avoided and isn't a big deal if you get along with everyone.

I just put up my website. www.traiteurlabouchee.com

Best of luck.