Chapter 34: Add Catering to Your Restaurant

Catering has come a long way from the simple chicken and prime rib buffets of the past. “Customers today are looking for the catered experience to be more restaurant-like,” says National Restaurant Association Chairman Denise Marie Fugo, who is also president and CEO of Sammy’s in Cleveland, Ohio. Fugo and her husband, Ralph DiOrio, started doing small private banquets and off-premise catering in 1988. Sammy’s catering became so successful that Fugo closed the restaurant to concentrate solely on catering.

According to the National Restaurant Association’s Industry Forecast, social caterers are one of the fastest-growing segments of the restaurant industry. There are over 53,000 caters listed in the Yellow Pages across the United States. According to the online journal catersource®, www.catersource.com, the annual sales of these 53,000 caterers are between $7 and $8 billion. This figure includes off-premise and banquet facility caterers but not hotels.

No doubt, catering offers high income potential. Many people leave the worlds of business, law, and medicine, to name a few, to begin a second career in catering. Although catering can be a lucrative career, it is important to keep all the aspects of the job in perspective. Catering is hard work and often the easiest part of the job is the cooking. When you are catering an off-premise wedding for 300 people, someone has to load, unload, and load up again the crates of china, silverware, and glasses — more often than not, that person is you.

Remember, too, that catering hours are long and the work is done when everyone else in the world is socializing. You do not just work the event; you work hard for many days, weeks, and even months before the event. And when you are working an event, chances are you are forgoing your own social events. For caterers, evenings, weekends, and lunchtime are bread and butter times, not down times.

With catering, timing is everything. You need to be able to multi-task, organize your time with military precision, and be prepared for the unexpected. Caterer Bev Goldberg recalls a time when she encountered the highly unexpected: She was getting ready for a cocktail party in a client’s home and double checking her master list: linens, plates, glassware, soft drinks, garnishes, hors d’oeuvres, ice. Satisfied that everything she needed for the party was ready and loaded into the van, she and two of her staff left for the event location. Upon arrival, she discovered no host and no guests. “The person who had contracted for the party had apparently forgotten and was not at home,” she says with a laugh. A veteran caterer with more than 30 years of experience, Goldberg, who co-owns Artistry Catering in Chantilly, Virginia, with her son, Randy, has become used to the frenetic pace and unexpected occurrences of this growing profession. “I love catering,” she says. “People still think it is a glamorous job, but it is just plain hard work.”

Not yet daunted? Okay, let us see if you have the skills to back up your enthusiasm.

SKILLS NEEDED IN THE CATERING BUSINESS

If you are an excellent cook, competent in artistic food presentation, possess some basic business knowledge, and love working with people, you have the basic prerequisites, but there are many skills and competencies that make for successful caterers.

COOKING AND FOOD PRESENTATION

Catered events, unlike restaurant meals, are usually centered around a special event such as a wedding, a product launch, or a special business meeting. As such, people expect more when attending a catered function. The food has to be outstanding and so does the presentation. For some venues and clients, you will be told that presentation is the most important factor, but always remember that no matter how artistically food is presented, if it does not taste good, it does not cut it. Make sure you and your staff are experienced with both aspects of food preparation.

PLANNING AND ORGANIZATION

Whether you cater off- or on-premise for business or social functions, you must have strong planning and organization skills. If you plan smartly, the physical work at the event goes much more smoothly. If you do not, you will find yourself in the middle of a hectic, unsuccessful event with unhappy clients.

Planning is especially important with off-premise catering because you cannot just run in the back and grab whatever it is you are missing. You need to plan for keeping hot food hot and cold food cold. You need to know what item gets served on which platter so you do not leave behind necessary serving dishes or serving ware. You need to ensure that the silverware has been counted and recounted: You do not want to be one fork short with no extra staff to round one up.

While 70 percent of a typical restaurant is food-oriented, with the rest going for service and organization, this figure flip-flops to 30 percent in the catering business. The rest is delivery, transporting the food, lining up rental equipment, and juggling personnel. In restaurants, every day is fairly similar. In the catering world, each day and event is different, making organizational skills vital.

EFFICIENCY AND CALM

As with any food industry business, efficiency is important. Ask yourself if you can work well under pressure. Because each event is unique, catering can be more stressful than many professions. It is not that most professions do not demand these skills, but in catering you not only have to deal with the stress, you have to make sure your customer never sees the stress. You need to be cool and remain smiling no matter what kind of chaos is tearing at your insides. You may have just finished putting out a fire in the oven after the praline topping for the French toast spilled over the side of the pan, but as soon as you come out to greet your client, you should have your chef jacket on, a smile on your face, and a cool, calm air that reassures your client that her event is going to be spectacular.

CRISIS MANAGEMENT

As a caterer a good deal of your time will be spent “putting out fires” — literal ones like above, as well as figurative. Expect problems to happen and be ready to solve them quickly and inventively. You need a great deal of crisis-management and problem-solving skills in catering, particularly with off-premise catering because you are dealing with so many unknown variables. You have to deal with event site problems, serving food at unfamiliar locations, and trying to find delivery entrances and parking spots. The event must go on, so you need to be creative. With catering you have to recognize that you are in the limelight and there are opportunities for error around every corner.

SALES AND MARKETING

Most likely, your restaurant has an established sales and marketing program. You can use this (and your good reputation) to build your catering business. However, you will also have more personal contact. You will be dealing with corporate executives, party planners, and nervous brides. You need to convince these prospective clients that you will not only provide a memorable feast, but it will be there on time, presented attractively, and served unobtrusively. You also need to come up with ways to retain business once you have been hired.

ASSESS YOUR SKILLS PROFILE

Even if you are a seasoned food service professional, adding catering to your food service establishment can be a daunting task. There are many factors to consider and much research to do — if you need additional space, additional staff, and what kind of food to serve. The most important factors to consider are you and your existing restaurant. Also consider these factors:

• Location

• Staffing capabilities

• Customer profile

• Physical layout of building

• Restaurant style/concept

• Cuisine and menu offerings

The proximity of your restaurant to other businesses will help determine where to focus your catering arm. In an area heavily populated with offices, universities, or hospitals, you may be able to incorporate business catering into your exiting business. If you are currently only open for dinner, it would be an excellent opportunity. You could cater corporate lunches and increase the earning power of your restaurant without worrying about interrupting existing business.

You can also consider social catering. Many restaurants close on Mondays and Tuesdays because these nights tend to be slow. Use those nights for catered events. For a small increase in food and labor cost, you can make a significant increase in sales for the week.

You may be able to get catering business from your existing customers. Let regular diners know about your catering service by using signs, table tents, and text within your menu.

When adding catering to your services consider the size of your facility and the type of food you serve. Is your building big enough to handle the extra production work? Do you have space for on-site catering? Do you serve formal dinners or lunch sandwiches? How much storage space is available for catering food prep and supplies?

Your space and menu may limit you in some areas but not others. Use what you have. If you do not have space for on-premise catering, you can try gourmet to-go dinners or another type of take-out service.

Before you sink your money into adding catering, ask yourself some questions to see if this really is the direction you want to take. The answers to these questions will help you determine whether you are ready to add a catering business and have the resources to do it or not.

• What are your goals in owning a catering operation?

• Will adding catering enhance your restaurant?

• What type of personality do you have? Are you an early riser or a night owl? Do you like interacting with people? Do you thrive on activity and crisis?

• Does your family support this decision and are they prepared to sacrifice time spent with you?

• Do your employees support this decision? Ask the opinions of your most trusted employees.

• Will your restaurant experience easily translate into catering? Can you apply the same management principles?

• How will you finance the operation? Will it jeopardize your existing restaurant?

ASSESS YOUR FINANCES

Take a good, hard look at your finances and determine if you really can afford to add catering— particularly if you are sole proprietor because your personal finances will come into play when you look for business financing.

How much of your own money can you afford to tie up in starting your catering business? When looking for financing you will have to demonstrate that you can finance a portion of it yourself. Do you have equity to invest and can you afford the monthly loan payments?

Check your personal credit before going out to find financing. To check on your personal credit record, call one of the three major credit unions:

• Equifax — 800-685-1111

• Experian — 888-397-3742

• TransUnion — 800-888-4213

The Fair and Accurate Credit Transactions Act allows you to get one report from each of these three credit unions for free once per year.

While your current finances are very important, just as important are the potential profits your catering company can earn. You do not want to invest your money, or expect others to finance or invest, in a business that does not have a high likelihood of profitability.

TYPES OF CATERING

Many people start out by off-premise catering out of their own kitchen. Others are interested in joining a large hospitality company and will look for work in a major hotel or at a large restaurant. These types of organizations generally provide on-premise catering. Catering is also segmented by what type of event is being hosted. Caterers work for both business and social events. It is not necessary to specialize in any event type because they are usually scheduled differently. Social events are likely to occur at night and on weekends, while business events happen more often during regular business hours.

Many people who start catering businesses do so while they are still employed, so they limit their catering work to nights and weekends.

To get a good understanding of what is involved with the different types of catering, let us take a closer look at each one.

OFF-PREMISE CATERING

Off-premise catering refers to a business that has a central kitchen but no separate dining facilities. Off-premise caterers transport the food and various other items to different locations. They might provide service for events in people’s homes, at kitchen-less banquet facilities, at parks for outdoor weddings, at offices for business meetings. In many ways, off-premise catering is more challenging than on-premise because each situation is new.

Many people start in off-premise catering because it takes less startup cash than on-premise catering. All you need to start is a kitchen facility — coined as a commissary — that will be used exclusively for preparation of foods to be served at other locations. Because of their low overhead, small off-premise caterers have the advantage of greater flexibility when it comes to price structures.

Off-premise catering has other advantages over on-premise catering as well. The experience can be more exciting and rewarding, especially if you are the type of caterer who enjoys the challenge of working in unusual, unique locations and dealing with new people.

One interesting specialization of off-premise catering is called mobile catering. Mobile catering specializes in feeding a basic menu to a large group of people, such as forest fire fighters, disaster relief workers, construction-site workers, and people taking camping trips or excursions. The caterer develops a seasonal menu and a picnic table concept on the back of a properly equipped truck. The fare is usually hot or cold sandwiches, beverages, soup, coffee, bagels, and burritos. Certainly this type of work is less glamorous than catering a gala ball, but it is profitable just the same and provides a little less stress on a day-to-day basis. Regardless of the type of off-premise catering you do, there are several important considerations.

Teamwork

Build a strong team with strong leadership. The teamwork required in an off-premise catering operation can make your company stronger. Your staff will learn to handle just about everything that can go wrong and you will have the potential to make six-figure incomes, each year.

Subcontractors

As the overall operating costs for off-premise catering are generally lower than for on-premise catering, you may find it within your budget to engage subcontractors for certain aspects of the event; for example, floral design, music, and entertainment. It can often prove more cost effective than doing it yourself. Many cities have agencies that provide these services; check the Yellow Pages under “entertainment” for such agencies. Often the best source of information is other caterers. Ask them which companies they use for flowers or music. Network with the people in your community to learn where to find sources of talent and expertise.

Five Keys to Success in Off-Premise Catering

Here are five important things to look out for when involved with off-premise catering:

1. Be ready for surprises. There are literally thousands of potential sources for disaster that can ruin an otherwise successful affair. Always have a Plan B.

2. Be prepared. You need to be organized, plan ahead, and visualize in advance all of the aspects of a catered event. As a catering professional, you will find that you make many lists. Be sure to check these lists four times before an event, and then check them again. Have someone else check them as well; they may catch something you missed.

3. Do a site visit. Visit early in the planning stages and visit the site again as the day approaches. Compare what you see to your lists and make sure you bring everything you need to make the event a success.

4. Be involved. Understand that you can only be successful in off-site catering by running your company from the center of the action and getting involved in all of the details of the business. Ask for feedback from the client and guests. Oversee the catering staff to make sure that they are performing to required standards. Jump in and help out when a table needs to be bussed or coffee needs to be refilled.

5. Keep cool. The customer is screaming, the brioche is burning, and one of your staff members just cut himself. The result: stress. Learn how to deal with it. A step in the right direction is to manage your time effectively. Set realistic goals — for a lifetime, for five years, for each year, month, week, and day.

ON-PREMISE CATERING

It is estimated that on-premise catering accounts for about two-thirds of all catering sales in the United States. On-premise catering operations range from large profit-oriented and “not-for-profit” operations to smaller, start-up enterprises, but it generally takes place at hotels, clubs, and conference and convention centers. Some restaurants also have their own banquet facilities and engage in on-premise catering. Other restaurants choose to close their operations to the public for a night and rent the space for a private function.

On-premise catering often offers an advantage to clients because it is a type of “one-stop-shopping.” Potential clients do not have the added stress of finding and securing a site to hold the function and typically the on-premise site is already nicely decorated and well laid-out for parties and events.

Four Tips for On-Premise Catering

1. Specialize. If you are looking for a niche in the on-premise catering business, explore the possibility of catering weddings. Weddings can yield high profits, largely because of all the extra purchases that are incorporated into a single event. Be sure to include a bridal consultant on your staff. This person will help with all the nuances and expectations that brides have and are also versed in cultural differences and customs that you will encounter. Do not rely solely on your bridal consultant. You need to become familiar with the rituals of traditional weddings and the types of concerns bridal couples and their parents will have. There are many websites devoted to planning weddings; visit any of these to see the types of concerns couples will have. One such website is at www.usabride.com.

2. Streamline. Make sure that the layout of your premises works with you rather than against you. The convenience factor is important when you are working under pressure. The distinct advantage of catering on-premises is that everything can be positioned pretty much within reach.

3. Comfort. You need to know how many people can be comfortably seated in your facility. Are you able to provide entertainment? Can you prepare a wide variety of menu items at the last minute?

4. Clubs. If you run a private club, promote your catering services amongst your members. Offer special deals for private parties and celebrations. Country clubs are better off concentrating on catering for weddings and dances. City clubs are advised to target the business sector. Consider specializing in catering for corporate meetings, board luncheons, and civic events. There are many marketing opportunities to help develop this clientele. Join your local chamber of commerce and become involved. These alliances will provide you with rich networking opportunities and new business.

THE BEST OF BOTH WORLDS

Many restaurateurs cater on-premise special events and also pursue off-premise opportunities. Dual restaurant catering is advantageous because restaurateurs have invested in professional production equipment. By serving both markets you can lower the overall fixed costs of your operation while increasing, incrementally, gross sales. This increase in sales can be achieved without having to spend money on expanding the dining room or kitchen area. When in the pursuit of both types of business, aim to achieve the following:

• Maximize on flexibility. Take advantage of the flexibility offered by a combination of on-premise/off-premise catering. By blending both types of catering, dual restaurant-catering operations enjoy the freedom to prepare their foods within their own facility, while at the same time employing outside labor.

• Maximize on expertise. Because of the flexibility offered by dual catering operations, you can draw on a greater pool of specialized expertise. You will be in greater demand for a wider range of significant events.

• Maximize on exclusivity. Define your exclusive target market. Determine, in advance, the specific clientele for your business. Securing exclusive clients is a definite advantage for a caterer; it will give you a strategic advantage over many other caterers in the market. Work towards exceeding your clients’ needs. It will bring you recognition and market dominance in an exclusive area of the catering trade.

• Develop a seasonal niche. The dual caterer should be aware of certain special annual events. These events involve preparation of the food on your own premises, while serving off-premises. The advantage of off-premise catering is that you can serve a greater number of people than at your own premises. Understand that the design of your kitchen will determine your capacity to cater off-premises.

Here are some suggestions for developing a catering business that serves up big profits:

• Decide early whether your restaurant’s catering operation will be in-house or off-premises. An in-house operation will let you use your own kitchen and equipment but it also may limit the size of events. Off-premise catering offers an opportunity for greater exposure, multiple daily events, and more revenue, but you also will have to abide by the rules of each particular venue.

• Staff smartly. You can use a culinary-staffing service to supplement your restaurant’s regular staff during catered events, but pull from your existing staff for smaller events. Your employees will appreciate making the extra money.

• You do not have to create a whole new menu for catered events. Look at what you have on your existing menu and see which items are cater-friendly. If you cater off premises, be sure to choose items that can hold their temperature during transport and can be partially cooked ahead of time.

• Transporting food requires an even closer eye to food safety. Train your staff on the additional guidelines they will need to handle transported food properly to prevent food-borne-illness outbreaks.

• Unless you cater on a daily basis, you may want to rent equipment for off-premise catering, such as stoves and hot boxes.

• Create lists of food items, job duties, and equipment.

• Know when to say no. Do not let your regular restaurant business suffer for your new catering business. If you try to do too much, quality will decrease and both businesses will suffer. Know your limits and live by them.

CATERING FOR BUSINESSES

Corporate sales make up approximately 75 percent of the total catering sales in the United States. Typical business events that require catering include the following:

• Meetings/Conventions

• Incentive events

• New product introductions

• Building openings

• Recognition events

• Training sessions

• Anniversaries

• Annual meetings

• Team meetings

• Employee appreciation events

The types of business events are quite varied and the corporate catering market is thus divided into three segments: shallow, mid-level, and deep.

The shallow market refers to the segment of low-budget functions such as employee-appreciation lunches. These events have limited budgets and resources and often do not include a great deal of lead-time. This segment usually includes businesses that are nonprofit, the educational sector, and the military sector. Although these events may be less profitable than others, they do fill a certain niche for the caterer. These types of events can be used to fill in for lag time between larger, more resource-intensive events.

Some money coming in is better than no money at all. In addition, the number of resources required is limited, so the expense of catering such an event is limited as well.

The mid-level market includes clients such as local associations that host regular training meetings. Price is important in this sector, but the resources are not as limited as in the shallow market. Therefore, the client is willing to spend a little more to make the event more impressive. Business at this level often leads to repeat business and word-of-mouth advertising.

The deep market involves more elegant, upscale events such as university presidential inaugurations or board of director dinners. Cost is usually not a factor in this segment of the market. The client is interested in providing an excellent, memorable event and is willing to spend what is required.

SOCIAL EVENT CATERING

Individuals rather than businesses usually book social events. They are set up around occasions that take place in people’s life cycle and include such events as:

• Weddings

• Births

• Anniversaries

• Reunions

• Bar/Bat mitzvahs

• Graduations

• Birthdays

• Fundraising events

• Holiday parties

Social catering is the first thing that comes to mind when people think of the catering business. Even though it is the smaller industry sector, caterers are drawn to this type of event because they are fun and lively and most everyone can relate to a birthday or anniversary as opposed to the launch of a new product or a building opening.

There are many different facets to the business of catering. It is up to you to decide which combination of catering segments most appeals to you and fits best with your skill set and objectives. Once you have a fairly clear idea of the direction you would like to take your catering career, it is time to get started and get into the business. The next sections detail how to start your own catering company.

MANAGING THE EVENT

Selling runs parallel to marketing and both are essential to the continued success of your catering operation. With your marketing plan in place, you know who your target customers are so now it is time to make your pitch.

If you are targeting several markets at once, it makes sense to segment your sales strategies and staff. Many firms divide their sales staff by corporate or private catering or even by specific types of functions, such as weddings, receptions, dinners, or special entertainment-related events. Develop specialized staff; let them focus on a specific area, thus gaining greater expertise and familiarity with all the particulars of their assignment.

Once you have determined the type of business you are after, you have to do just that: Go after it. Use lead referrals, advertising, and aggressive cold calling. Work your leads like your livelihood depended on it.

The most successful salespeople are the most persistent. Pay close attention to what conventions and groups are coming to town; gather the information as far in advance as you can.

One of the keys to developing leads is through networking your existing contacts. If the client is happy with your event, try to get a few good words of recommendation as well. Ask if you may use their words of reference in your sales catalogs or brochures. Be sure to add all influential attendees of your functions to your database.

Once you have a client that you are trying to win over, be sure to protect yourself. Many new caterers are hungry for those first few sales. Try to establish quickly and discreetly whether the client has sufficient funds to pay for your services. Aim to qualify them right away. If their budget still remains questionable, send them to your competition. Be suspicious when the promised deposits are not sent to you. If you already have a heavy commitment during the time of a proposed event, refuse, no matter how good a client is. Do not over-commit yourself and your staff.

HANDLING INQUIRIES

Most inquiries will be over the phone, so make sure you or your staff can answer the phone personally for as many hours as possible. Someone not getting a quick response will just move on to the next caterer on her list. If you are part of a large business, consider hiring someone full-time to man the phones. Ideally, you will have someone answering the phone and responding to inquires six days a week from 9 a.m. to 7 or 8 p.m.

The person answering the phone should be polite and knowledgeable. When someone calls in, the first step will be to check availability on the date the potential client needs services. Always have an updated day planner to give the potential client an immediate response on availability. If you have someone in the office handling calls, you can computerize this information on a banquet inquiry form. Make sure the person answering phones fills this form out completely.

The potential client is likely to be calling several area caterers, so you should follow up in a few days to see if there are any other questions you can answer and try to set up a meeting. Showing initiative can take you a long way in the competitive catering business.

MEETING WITH THE CLIENT

When meeting with your client, be professional and come prepared. Bring sample menus, photos of past parties, samples of dishware, a contract, notepaper, pens, and references. If you are an on-premise caterer, be sure to show the client the facility when you meet, including the dining and bar areas and parking. Take thorough notes so you can refer to this information when drawing up the contract and planning the event.

Make a question list to take with you to make sure you have covered every detail. Here is a sample list:

• When does the event start? When will the meal be served? What time will the event end?

• How many guests are you expecting?

• Is security needed?

• Do you need any signage?

• Should there be a checkroom available for guests’ coats?

• What type of decorations does the client want? (Color of linens, flowers, balloons, etc.)

• Will someone be setting these up or will the caterer be responsible?

• When will the decorators need access to the room?

• What type of service does the client want?

• What type of china?

• Beverages?

• Will there be music? What times will the band be playing? Will there be dancing?

• Will the band be provided with dinner?

• Are there any audio-visual requirements?

• Is a photographer needed? Who will hire this person? When will photos be taken?

• What kind of room setup does the client want?

• Will there be a head table?

• Are there any programs or other printed material that need to be distributed to guests?

• Is there a formal seating chart?

• Are telephone or computer hookups necessary?

• Will there be a speaker?

• Any lighting requirements needed?

• Any special permits needed?

• How many cars will be expected? Will the client pay for parking or will the guests?

As you are listening to the client, try to pick what is most important. Part of your job is to figure out what is essential and what is not a priority in your client’s mind. If the event is a wedding reception, the person may want to serve three different entrées — chicken, beef, and fish. On the other hand, the budget for the event may only allow for two entrée choices. Communicate this information to your client in a positive way. Everyone has budgetary limits. Rather than trying to force someone to spend more than they can afford and create potentially bad word-of-mouth advertising, try to adjust the client’s expectations and still give her a memorable event.

Site List

If you are an off-premise caterer, it is a good idea to hold one of your first meetings at the intended event location. You can see the equipment and storage and get an idea if you need to buy new equipment to make the party work. Bring your note pad, tape measure, and calculator on this trip. If the event is being planned far out in advance, it is also a good idea to take your camera. That way you will have a “memory jogger” when you get ready to work on the details at a later date. As you look at the facilities, ask yourself these questions:

• How will the tables be set up? Is there a buffet? Is there room for a separate dessert and appetizer buffet?

• Where will drinks be set up?

• How many ovens are there and how much cold storage do you have?

• Will you need to bring auxiliary equipment?

• Are there pots, pans, etc., to use or will you need to bring them?

• Where will the dirty dishes be bused to and washed?

• Where does the trash need to go?

• Are there adequate restroom facilities?

• What is the parking situation? Will there be valet parking?

• Does the room require any special decoration?

You also need to know the timing of the day’s event. If you are working on a wedding reception, you should ask what time the ceremony is, when the guests will start arriving for the reception, and when appetizers and dinner should be served. Will there be toasts and bouquet tossing and at what times? What time should the event wrap up?

If you are an off-premise caterer, it is a good idea to make a site list to take to these meetings. One of the biggest challenges to an off-site caterer is how to deal with the variety of equipment and conditions you run into at various venues. It is easy to forget to check every detail in the beginning. A site list is a good way to make sure you bring all the equipment you need for the party. There is an example of a site list at the end of this chapter.

Types of Service

There are benefits and drawbacks to each type of service. You will want to keep these in mind while you are meeting with and negotiating with your client. The style of service will impact your event, the guests’ interaction, and the quality of service you can give. The following table gives the advantages and disadvantages for various types of service.

TYPE OF SERVICE ADVANTAGES DISADVANTAGES
Type of Service	Advantages	Disadvantages
Plated	You control portion sizes and establish the pace of the meal. It’s easier to create dramatic plate presentations and a romantic or elegant ambiance.	Requires a lot of planning.
Family Style	Food is easy to assemble and won’t get cold quickly because it is being served from large serving dishes. Good for casual events, creates a sense of camaraderie.	No plate presentation. Passing dishes among guests can be awkward.
Casual Buffet (guests serve themselves)	Most food will be in place before event begins. You can offer a variety of dishes, guests can help themselves, and you don’t have to seat everyone at once to begin serving.	Serving size not controlled, will need to replenish buffet, and have considerable leftovers. Hot items can be difficult to keep hot.
Formal Buffet (servers are used)	Servers allow people to move through buffet line quicker and determine portion size, fewer problems with running out of food. Can serve a whole carved meat to add elegance to event. Hot dishes are easier to keep hot because servers are paying strict attention to these.	There is the added expense of servers.

Your job as the caterer is to navigate your client through the various options and possibilities to come up with an event that is outstanding yet still respects the client’s budgetary limits.

QUOTES AND CONTRACTS

Never give a quote over the phone. Meet with the potential client and make sure of exactly what she wants before offering a quote or you may significantly underbid.

Write down every detail of what the client wants. Record food selections, number of servers, length of event, number of guests expected, linens desired, extra services, and bar specifics. Once you leave the meeting with the client, analyze the information and crunch numbers before calling back with a quote.

Everything affects the price you come up with, so think through all the details. What is the occasion? Will the event require a light lunch or a large, multi-course buffet? What are the logistics involved with the location if the event is off-site? Will you need to supply additional cooking or cold storage equipment? Will you be cooking on-site? If the event is on-premise, what is the typical room charge associated with a room that will hold the desired number of guests?

Once the client decides on food preferences, prepare an outline that includes the following tasks:

• Food shopping

• Food prep

• Travel time to and from event

• Loading and unloading time

• Setup time

• Reheating and arranging food

• Serving time

• Cleanup time

It will help you determine your time, start to finish, because even though the event may be from 7 p.m. to 10 p.m., you will be working long before and after the festivities. With this information and your pricing information, you will be able to develop a fair quote that will still ensure you make a profit.

Writing a Contract

Regardless of how well you know the person you are catering for or how nice he or she appears, you must have a written contract. Without a contract, you will be defenseless when attempting to collect from a non-paying customer. A contract is a binding agreement between two parties; the caterer is obligated to provide the food and service stated and the client is obligated to pay for this food and service.

Many caterers start small and their first clients are usually friends and family members. Although it may seem uncomfortable to a friend or relative to sign a contract or give you a deposit, you should resist the temptation to skip these steps. Make sure all your agreements are committed in writing. In many states, only contracts in writing are enforceable. A written contract will encourage your client to ask for additional services to be provided during the initial phase of your negotiations. Think carefully about the tone of your contract. Although you want to protect your business, you could alienate potential business with an aggressive tone. You can still convey the same information without being antagonistic. Templates and examples of contracts can be found at www.catersource.com.

Always ask for a deposit up front. Any time you do not receive a deposit, you are in danger of cancellation, even at the last minute. Deposit policies vary; some caterers ask for one-third when booking, another third one month prior to the event, and the remainder on the day of the event. Alternatively, a caterer may receive 10 percent on booking, up to 50 percent a month prior to the event, and the balance on the day of the event. Your terms will be dictated by your cash flow needs.

BASIC CONTRACT STIPULATIONS AND CONSIDERATIONS

The following list of stipulations and considerations is intended as a guideline only. It is by no means exclusive; it is intended to draw your attention to a few basic requirements. When developing your contract template, bear in mind the following:

• Personal details. When composing a contract, first include your name, address, phone and fax numbers. Next, enter the client’s name, address, phone and fax numbers.

• Dates and times. After indicating the date of the contract, state the day and date of the event to be catered, as well as the starting and ending times for the party. The exact amount of time allocated to each activity is especially important; if the caterer runs into overtime, an overtime charge should be applied against the client.

• Make sure to nail down the minimum number of guests. Establish the exact number of people to be in attendance. If not possible, ascertain the minimum number of guests. Build in a clause that permits you to raise the price per person should you end up catering for less than the estimated minimum number of guests. You also should include a clause that you need final numbers by a particular date. Most caterers ask the client to give them a final guest count three days before the event. Doing so allows the caterer an appropriate amount of time to shop and prepare the correct amount of food.

• Determine a method for tracking the number of guests. Some common methods for tracking guest numbers include tickets, plates issued, bundled/rolled silverware with a napkin issued, and by a turnstile. Today, many events are preceded by invitations that request an RSVP. The RSVP allows you to have a more accurate guest count.

Here is an easy formula to determine how many guests will actually show up at the event:

Number of guests invited x 0.66 x 1.15 = number of guests to anticipate.

For example: 300 invited guests x 0.66 x 1.15 = 228 anticipated guests.

The 0.66 accounts for the number of no-shows and the 1.15 accounts for the uninvited guests that will arrive.

• Guard your reputation. Regardless of how you arrive at your number, remember that if the caterer runs out of food, it is the caterer’s reputation at stake. The guests will not know that the host underestimated the count, nor will they care. They will just know that they are hungry, there is no food left, and it is the caterer’s fault. Let the clients know that they are always welcome to take home any unused portions. Generally, caterers have a guarantee number as well as a real number for the guest count. This guarantee usually runs between 3 and 5 percent of the total. In other words, if the event is set for 200 people, the caterer will prepare food for 206 if their guarantee number is 3 percent.

• Include a section in the contract that details the menu to be served. Nothing should be left out and nothing should be assumed. If you need to make major changes to the menu, and you probably will, draw up a new contract.

• Event price. An event price is established at the same time the client is shopping for a caterer. The contract must state that the price is an estimate only. Include a clause that permits the caterer to adjust the price, based on unforeseen conditions. Large events are booked approximately six months in advance. Smaller events may happen on much shorter notice, but most caterers have guidelines for the latest date they can accept a job. For instance, a caterer may stipulate that she will book up to three days prior to a small event.

• Payment policy. According to the schedule agreed upon, include a clause stating unequivocally the method and time frame for the payments — in general, the larger and more expensive the event, the larger the deposit.

• Staffing. Include a section in the clause that states the number of staff to be provided, the hours they will work, as well as applicable charges for their services.

• Define your policies regarding leftover food and alcohol. It may be determined by the event. If you are catering a 40-person dinner party at a client’s house, you are likely to box and leave the leftovers. If, on the other hand, you are catering a wedding reception for 150 at a rented hall, you will probably take the leftovers back with you and divide amongst the staff. You should also state your policy on serving alcoholic beverages to minors or those people who become intoxicated.

• Cancellation/Refund policy. Discuss in detail your policy regarding cancellations and refunds.

• Caterer and client signatures. Do not forget: Without the necessary signatures, the contract is not legally binding.

The sample contract at the end of this chapter may help you draw up your own catering contract agreement. Use it as a guideline only and consider obtaining professional legal advice.

CANCELLATIONS AND REFUNDS

In the event of a cancellation, should you refund some, all, or none of the deposit? In general, there are no clear-cut answers and you should determine it on a case-by-case basis. The timing of cancellations is crucial in determining your policy. If someone cancels months before the event, you probably can re-book the date. If, however, the client cancels a week ahead of time, you will probably not be able to re-book and you may lose deposits you made on rentals or money you have already spent on food purchases.

Many event locations, such as hotels, community halls, and convention centers, often have a step refund policy. If a client cancels three months before the event, the facility will refund the entire deposit. If the event is cancelled a month before the event, the facility will refund 50 percent of the deposit, and if the booking is cancelled a week to a month in advance, 35 percent of the deposit will be refunded. If the event is cancelled within the week of its occurrence, no refund is issued. This type of step policy helps to offset some of the costs the off-premise caterer may have already absorbed.

When deciding on the fairest course of action for your own cancellation/refund policy, consider the following issues:

• If the client cancels at least a month before the scheduled event, you may want to refund the full deposit. In fact, you can very well use this policy as a selling point when a client is trying to decide between you and another caterer.

• If the event is cancelled within a month of the scheduled event, discuss the matter with the client personally.

• If the cancellation happens at the last minute due to a tragedy involving one of the principals, it is best to wait a period of time before getting the client to discuss refunds.

When you are not sure how to handle the cancellation, postpone your decision; tell the client that you have to check your figures to see how much money and time has already been invested. Take this time to calculate a reasonable amount to pay for costs you have already made. Refund the rest.

CLIENT’S REFUSAL TO PAY

If you run into a situation where a client just will not pay, the first step is to send a personal letter requesting payment. It is very likely that your client simply forgot. Make sure to gently remind the client of the amount due and give the client a reasonable due date, such as 10 days, to pay the balance.

If this does not work, call the client. The next step would be to have your lawyer send a standard collection letter. While it may seem silly, people really do sit up and take notice when they receive a letter from a lawyer. While this tactic might result in payment, it is likely to cost you a lawyer fee as well.

If nothing else works, you can try small claims court. This process is time consuming but not very expensive. In most states, claims are usually limited to between $1,200 and $2,000. Nothing guarantees the judge will rule in your favor. And even if he does, you are not guaranteed immediate payment.

Another route to try for delinquent payments is a collection agency, but these agencies take a fairly large cut, so you may want to try all other alternatives first.

The best way to get the money you need to cover your costs is to prepare a solid refund and cancellation policy that addresses all of the issues discussed above.

PAPERWORK

Now it is time to get down to the nitty-gritty of event management. Once you have secured a contract, you will have many details to attend to and there is a good amount of paperwork that can help you keep track of all these details.

Event Order Sheets

Prepare an event order sheet and give it to your service staff. This sheet will provide the information they need to make the function successful and it will work as a list so they can double check their equipment and food. Use and amend this sheet when you want to organize and plan for any special event. Make sure to record notes about the event; if it is a public event, write down anything such as weather and product and staffing issues and save it in your event book for future reference.

An example of an order sheet is at the end of this chapter. You can download a template of a worksheet from www.restaurantbeast.com and see another version of a similar worksheet on www.wedoitallcatering.com.

BANQUET EVENT ORDERS

Most large caterers or those associated with a hotel or restaurant use Banquet Event Orders (BEO) to record the bar and buffet layouts, table settings, and other pertinent setup information. Many of these also include a room diagram. Smaller caterers will benefit from using these orders as well because small or large, a caterer lives and dies by the details.

In hotels, BEOs are prepared for each meal or beverage function and circulated to the affected departments a week or so before the event. They are usually sequentially ordered to help keep track of them. A sample BEO can be found at the end of this chapter.

A typical BEO contains the following information:

• BEO number

• Event date

• Type of event

• Client name and address

• Person who booked the event

• Name of function room or event location

• Beginning and ending time of event

• Number of guests expected

• Menus

• Style of service

• Room setup

• Prices charged

• Billing information

• Date BEO was prepared

• Name of person preparing BEO

• List of persons receiving a copy of the BEO

• Special instructions (centerpieces, special accommodations, entertainment, etc.)

STAFFING

If you are only adding a small catering component to your restaurant, you will not need much additional staff. If you plan to expand, you may need to staff catering as a separate department. In a large catering facility, typical positions include:

CATERING STAFF
Title/Position	Job Duties
Director of Catering	Assigns and oversees all functions and marketing efforts. Interacts with clients, coordinates sales staff, creates menus in coordination with chef.
Assistant Catering Director	Services accounts, assists with marketing.
Catering Manager	Services accounts and maintains client contacts.
Catering Sales Manager	Oversees sales office and sales staff.
Catering Sales Representative	Handles outside and inside sales.
Convention/Conference Service Managers	Handles meeting and convention business and room setup (usually a position found in hotels).
Banquet Manager	Oversees captains, supervises all functions in progress, schedules front-of-the-house staff, acts as operations director.
Assistant Banquet Manager	Reports to Banquet Manager. Supervises table settings and décor.
Banquet Setup Manager	Supervises banquet setup crew, orders tables and chairs and other equipment, supervises tear down of the event.
Scheduler	Enters bookings in a master log, oversees timing of functions. Schedules meeting rooms and other meal function rooms, keeps appropriate records to ensure there is no overbooking or double booking, communicates information to relevant departments.
Maitre d’Hotel	The floor manager in charge of all service personnel and all aspects of guest service during the meal function.
Captain	Oversees the activity of a meal function and the service personnel.
Server	Food servers and cocktail servers work the event, handling and serving food and beverages to guests.
Bartender	Serves drinks during events and restocks bar inventory. May also need to keep track of drinks for pricing information for the event.
Sommelier	Wine steward.
Houseman	Physically set up the tables, chairs, dance floor, stage, etc., for an event.
Attendant	Refreshes meeting rooms. Does spot cleaning and trash removal.
Clerical Staff	Handles routine correspondence such as typing BEOs, contracts, and handling and routing phone messages.
Engineer	Provides utilities services and maintains catering equipment. May also handle audio-visual or lighting installation.
Cashier	Collects money at cash bars, sells drink tickets and meal tickets if event has them.
Ticket Taker	Collects tickets from guest before they are allowed to enter an event.
Steward	Delivers requisitioned china, flatware, linen, etc.
Cook/Food Handler	Prepares the finished food product according to the Banquet Event Order form (BEO).

You may need to hire temporary help for large events. Check with your staff or other area caterers. There is usually a large pool of people that work temporary catering jobs and they tend to work for several companies at once.

You will be paying your catering staff per event, even if some of the help comes from your regular employees. If your regular employees work an event they should be paid in the same fashion as temporary workers. Generally, for catered events, servers and bartenders are paid $95 to $120 for four hours (this does not include a tip the host or hostess might include). After four hours, the client is charged $15 to $20 per half hour. Kitchen staff is generally still paid a per-hour rate or flat rate per event. Per-hour rates generally fall between $15 and $25.

EQUIPMENT

Catering operations, much like restaurants, are production facilities. Unlike restaurants, which are designed to produce food in individual servings for individual diners, a catering kitchen must be able to serve many people the same food at the same time.

Although you will already have most of the equipment you need, you will want to invest in additional flatware, china and linens, as well as the items listed in the “Equipment for Transporting Food” section of this handbook.

Menus

When creating your catering menus, consider the following:

• Which items on your restaurant menu do well.

• What products you already order and have on hand.

• Which items on your menu would hold well.

• Which items can be mass produced easily.

• How much storage space you have available.

You do not have to start from scratch. If there are items you already sell that could hold and be produced in quantity, include these on your catering menus.

Use your menu sales analysis and sales history to determine popular, cost-effective recipes you may want to include in your catering operation.

Menu sales analyses, or menu scores, track each menu item that is sold. Many restaurants have computerized cash registers, so getting a report on what items sold nightly, weekly, or monthly is easy. If your restaurant does not have a computerized register, you can track a period of time (a month) and get this information from guest checks.

Cost can easily be pulled from your standardized recipes or cost sheets and your sales history can be pulled from a daily log that records customer counts, daily sales, daily costs.

A menu item’s profit margin, what the item contributes to the overall profit of a restaurant, is the difference between the menu price and the item’s food cost. To determine profit margin, you will need to look at monthly financial statements. Subtract your total food-costs from your total sales.

You should also consider creating catering menus that allow you to use products already on hand. When creating a catering menu, take the opportunity to include items that will allow you to use leftover inventory. For a complete discussion, see the “Menu Planning” section of the handbook.

MARKETING

Just like your restaurant, you will need to market your catering operation. Because you already have a customer base, you already have a leg up in marketing your catering business. Take advantage of your existing customer base and do some internal marketing.

Internal marketing refers to techniques used once the customer is inside your restaurant. This type of marketing tool can be a great way to build business for the catering side of your operation. Here are some internal marketing ideas:

• The restaurant menu itself is an important internal marketing tool. The menu and quality of food will help entice your customers to use your facility for special events.

• Set up table tents or signs that let your customers know you cater.

• Provide carry-out catering menus at the cashier or hostess station, as well as brochures and business cards.

• Have one of your servers take a tray of appetizers you use for your catering menu into your front area and serve the customers waiting to be seated.

• Have people drop business cards into a fishbowl and hold a drawing once a week. The winner receives a free catered lunch for himself and three friends.

• Use these business cards to create an e-mail list. Send out e-mails to promote your catering business.

• Create T-shirts with your logo and catering information and sell these at the hostess stand.

• Give your servers buttons to wear that say “Ask me!” When customers ask, the servers can tell the customer about your new catering business and give them a brochure. For external promotions, make sure you know exactly what needs promoting before spending your revenue on advertising. Advertising is expensive and there is no guarantee it will succeed. Do your homework before you spend your money.

Here are some ideas for external promotion of your catering arm:

• Donate food to a local public radio fund drive. It will give you free advertising on the station when they thank the people who donated food.

• Visit your local chamber of commerce. All cities have festivals, parades, and other events. See how you can involve your restaurant’s catering operation.

• If you have the advertising budget, place ads in newspapers, on the radio, or on television.

• Set up cooking demonstrations at a local mall.

• Talk to area schools about conducting a tour of your facility as a class field trip.

• Use a rubber stamp on outgoing mail saying “We cater!”

• Another possible marketing strategy is to offer cooking classes. You may be interested in doing a class at your facility or just doing a demo at a mall kiosk to increase your public exposure.

CONCLUSION

Catering is a complex, exciting area within the food services industry. There are many factors to consider before deciding to add it to your restaurant. If you decide to take the plunge, the rewards can be considerable.

For much more information about running a catering business, whether in an established restaurant or a new catering operation, I recommend the following books, available from Atlantic Publishing (www.atlantic-pub.com).

• The Professional Caterer’s Handbook How to Open and Operate a Financially Successful Catering Business With Companion CD-ROM (Item # PCH-01)

• The Food Service Professional’s Guide to Successful Catering: Managing The Catering Operation For Maximum Profit (Item # FS12-01).

• The Complete Guide to Successful Event Planning With Companion CD-ROM (Item # SEP-01).

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