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Starting a Catering Business

Starting a catering business can be a lucrative moneymaking opportunity. In the US alone catering accounts for $5 billion in annual revenue. If you have a love for food, or food preparation providing catering for wedding events. Parties, or corporate functions may be a great business for you.

About the Catering Business

As a professional caterer you’ll find a wide range of catering opportunities for home-based entrepreneurs. Some home-based caterers start out cooking in their home kitchens. Starting out in your own kitchen can keep the initial costs relatively low and you can pass on the savings to your beginning customers. Starting as an in-home caterer does not require expensive equipment, or years of cooking training.

However, in many states it is illegal to sell food to the public that’s been prepared in your home kitchen. You’ll need to check with your state laws to determine if home preparation is allowed. A good way to get around the high startup costs of renting a commercial kitchen, is to use your local church kitchen. You can also try cutting costs by sharing kitchen rental expenses with other caterers. Many caterers opt to install a commercial kitchen in their homes. Installing a commercial kitchen will will mean you need to abide by certain zoning laws. Many caterers start out with their business in their spare time, and since the majority of special events requiring catering services take place in the evenings or on the weekends, it can become a great supplemental income.

Types of Catering Services

  • Party food preparation
  • In-home catering
  • Wedding catering
  • Mobile food services
  • Event catering
  • Specialty foods like cookies or muffins
  • Hotel banquets
  • Furnishing food for yachts and airlines
  • Serving as an executive chef in someone’s home
  • Corporate catering
  • Gourmet catering

Advantages of Starting a Catering Business

If you love cooking and enjoy food than a catering business might be your calling. Catering to be a great occupation for someone who is creative, social, and enjoys pleasing other people. As a caterer you choose a schedule that’s right for you. Often your work will take place on the weekends or in the evenings, giving you time to work a regular day job, or do other things you enjoy.

Another great advantage of catering is the recognition you’ll receive. As a business in high standing you will develop a reputation around town which will help you generate good word of mouth business. Catering can also provide a very appealing income potential. Successful caterers who have been in business for several years, and have built up a network of clientele can expect to earn $70,000, to $100,000 a year.

Disadvantages of Catering

The catering business is tough in the sense that there is a good amount of stressful work and planning required to be a success. The food business has some of the highest rates of failures among any type of new business. As a caterer you will be required to generate new customer leads, meet with potential clients, and put together competitive bids. You will need to be able to handle crisis as they happen, and deal with many different types of people and their ever-changing demands.

Starting a new catering business often means you have to do the cooking, serving, cleanup, and billing. Sure you can hire people to do these things, however when starting out that is often impractical.

While some people feel that working weekends and evenings is the ideal work schedule, many people would rather have those times off, if this is you and you’ll find the hours of a catering business to be a disadvantage. In addition to catering can often be a seasonal occupation.

Skills Needed

Being a gourmet cook is not a requirement to operate a successful catering business it does help to have some experience cooking and with the hospitality industry. You should enjoy trying new recipes, and planning meals.

It’s helpful that you enjoy entertaining and have a love for social gatherings and are a personable friendly person. For your new business to take off you really need to have excellent people skills in order to please your customers and keep everyone happy.

Caterers should have working knowledge of cooking, food preparation, food storage, and sanitary working conditions. It’s helpful if you have experience as a manager and have peoper organizational skills. You’ll need to be well versed in creating contracts, and marketing your business.

Catering Home Business Information

Startup Costs – For a professional catering startup you’ll need a minimum of $10,000 on the low end and $50,000 on the high end. If you are starting in your own kitchen you can get started for as low as $1000.
Equipment Required – Pots, pans, utensils, serving equipment, tables, table cloths, linens, business insurance, license, legal fees, and kitchen rental.
(You can rent items initially to cut costs)
Home Based – Yes, can be operated from home
Online Work – No
Hours of Operation – Mostly evenings and weekends. Can be seasonal if focusing on parties (Nov-Jan) or weddings (June-July-August) Can be operated as a part-time business
Catering Rates – Price food at three or four times your cost to compensate for time and effort.
Potential Earnings – $30,000 to $100,000 a year
Catering Resource Links

Catering Resource Guides

Professional Caterers Handbook: How to Open and Operate a Financially Successful Catering Business

If you want to specialize in a wedding catering business than this is the guide for you. This book comes with a cd-rom supplement and contains step-by-step instructions about bookkeeping, the pros and cons of professional equipment, and how to become profitable. This reference book is used and recommended by culinary schools.

Catering: A Guide to Managing a Successful Business Operation

Inside this book you’ll find out how to launch a catering enterprise, pricing your services for profit, hire and manage staff, set up your catering kitchen, marketing for your service, event planning, establishing your service, managing the dining experience and more.

Online Course

Starting a Catering Business Course Kit

If you are considering starting your own catering business you’ll definitely want to get your hands on this course. Inside you’ll discover what you need to open your new business, how to know what to charge, the secrets to attracting new clients, handling billing & accounting, cash management, proper record keeping, creating happy clients and growing your business.

1 Comment to Starting a Catering Business

  1. Shabbir Alarakhia's Gravatar Shabbir Alarakhia
    September 14, 2010 at 6:30 am | Permalink

    I would like start a catering business opening a coffee Shop and Delievery of sandwiches to different offices,Schools,Hotel,Airline company etc.
    Please advice if home business or opening a venture would be the quickest way of making money.I would like to making this a full time job and how much capital would be needed. please help and advice.

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