How to Start Your Own Highly Profitable Catering Service

11/30/2013

People with money seem to be on a binge to prove their status and flaunt their wealth by staging large, catered parties. As a matter of fact, in some circles of affluency, a party or social get-together isn't considered an event of any significance unless it's a catered affair.

With the same kind of reasoning, businesses of all sizes are using catered lunches, cocktail parties and dinner meetings to build their images and increase company sales. It's a matter of keeping up with the competition in promoting a company and/or product.

On a smaller, but just as busy marketing scale, more and more working mothers are paying to have catered birthday and graduation parties, as well as wedding receptions handled by caterers. The reasons are simple to understand - if she's working outside the home, today's mother just doesn't have the time or the energy to do all the planning and staging of a memorable party.

Besides those reasons for turning everything over to a caterer working mothers feel a little guilty about the time away from their children they lose because of their jobs. Thus, they're ready and willing to make it all up to them by paying for a lavish party the child will remember for years to come.

Caterers handle everything from birthday parties for children, to breakfast in bed and intimate candlelight dinners for two, to company dinner parties for 50 and wedding receptions involving a thousand or more guests. This kind of entrepreneurial business is definitely growing and becoming more popular with people of all income levels.

An imaginative caterer in a large metropolitan area can easily gross $150,000 per year, while a small, part-time caterer in a small town can count on at least $10,000 to $15,000 per year. One small, but very ambitious caterer is reported to have grossed $250,000 after only 2-years in business!

You don't need special education or training to become a successful caterer. You do need an affinity for people and a kind of intuition as to what people enjoy in different environmental settings.

A quick survey of successful caterers across the nation shows that many began with zero capital by working out of their homes. The basic start-up investment would appear to be around $500, with some big spenders capitalizing their idea with as much as $15,000 in order to get off to a fast start.

This seems to be an ideal business for an ambitious couple to start and operate with very little capital investment required. One person can spend his time hustling up business while the other would do the planning, organizing and actual catering.

As with any business, your success will be directly related to the soundness of your planning, and the working of that plan. Understand exactly what your client wants, and give him what he wants in the way of service that reflects upon the client in a complimentary manner.

Basically, you can start with an advertisement in your local newspapers. This advertisement need not be much more than a simple announcement: Creative Catering - Specializing in personal service - We can handle any party or special event from start to finish - no idea too small or too large - Your satisfaction is always guaranteed! We can handle everything for you... Call us, and let us make your parties worth remembering...

Naturally, the first thing you want from anyone calling to ask about your services, is that person's name, address and phone number. Then you want to know what kind of party or event they have in mind. As soon as you have this information, relax a little bit and inquire to find out about the person or the company - the people - sponsoring the party and their ultimate goals or reasons for the party.

If it's to celebrate a birthday, graduation, anniversary or a wedding reception - finding out about the interests, background and ambitions of the guest of honor will be of value to you in your planning. Taking a few minutes to learn everything you can about whoever the party is for, and the people giving the party, will also make it much easier to close the sale than any sales pitch or special persuasive tactics.

People like to talk about themselves, and they especially like to tell everyone why they're honoring someone, even when they pretend to keep it a secret who initiated the idea. So, it's important that you be a good listener, that you have the ability to get people to talk about themselves, and that you take notes on the things they tell you.

This same principle applies to business people, regardless of who's talking to you or the purpose of the catered affair. The more polished and adept you can become in getting your prospects to talk about themselves, the more information relative to their background you can elicit and the more you listen; the better your parties will be, and the greater success you'll attain in the catering business.

You take the information you glean from this first interview and plan/organize the event on paper. This means you're going to have to have contacts or at least working relationships with innumerable service businesses.

If your client wants to stage a birthday party for a 12-year old - he or she greets the guests as they arrive, makes sure everybody knows who he is - then what about party favors - a soft drink and a conversation leader until all the guests arrive - the opening of presents - ice cream and cake - and games to play, a thank you gift for coming, and a reason to end the party at a pre-determined time...

Do you greet the guests, does the mother or father, or the little boy or girl? Where do you come up with party favors at less than regular retail prices? Where are you going to get the soft drinks - your cost - and the glasses or paper cups to serve them in? What about ice? What kind of games to play? Who will be the conversation leader? Will there be a clown or someone special to keep everything moving according to plan? Where do you get the ice cream and cake? What games to play? How to get everyone involved? And finally, a feasible and polite reason for ending the party and sending everyone home...

All this takes planning, organization, and if you're going to make a profit, a definite awareness of cost control. Get it all down on paper as a proposal to the people who want to pay you to carry it off. Figure out your costs, the time involved in putting it all together, and then get back to your prospect.

Always leave room for changes in your proposal. In fact, expect them - invite input and suggestions from the client - and always have an alternate idea in your mind for each of those on your written proposals. Discuss your proposal with the client just as you would a script for a television show, make the suggested changes and ask for a 50-percent advance deposit. From there, it's just a matter of following your plan.

Regardless of size or type of party - whether your client is a working mother or a giant corporation - the format is always the same: initial inquiry, interview, your proposal, second interview for any changes, agreement, deposit, staging the party itself, and your final payment. As mentioned earlier, success in this business comes from your planning - having a lot of contacts - and working your plan.

An important word of caution: Try not to get "boxed in" to setting or even revealing a tentative price until you've had a chance to listen to what the prospect wants, to study your own capabilities, and to make a formal written proposal. If a customer wants to know how much you charge - and if you feel it necessary in order to eventually close the sale - you can tell him 50 to 100 dollars per hour, plus expenses, and of course, depending on the type of event the customer wants.

As for how much the average party costs, again tell him that it varies anywhere from 50 to 5,000 dollars.

Always keep in mind that you are a professional, and that if the ordinary person had your knowledge, contacts and ambition to do it himself, he wouldn't be calling you on the phone. He needs your help for any number of reasons. You specialize in this kind of work or service just as a doctor specializes in medicine and a lawyer in legal matters. Therefore, you should, and do expect to be paid accordingly.

Something else - this business thrives on word-of-mouth advertising - referrals - and thus, is a direct "freeway" to the kind of customers where money is of no concern. However, in order to gain access to this market, your business emphasis has to be on service.

This means the capability of handling everything for the customer, from having the invitations printed and sent out to cleaning up after the last guest has left. Businesses and people in the upper income brackets, like to pick up the phone - tell someone that they want a party on a certain date - and then forget about it, knowing everything will be taken care of without further worry or time involvement from them. Once you've developed your expertise and clientele to this level, you'll have a business in the $200,000 to $250,000 per year range.

Definitely arrange for a display ad in the yellow pages of your telephone directory. You will probably get 40% of your inquiries from this source alone. Generally speaking, radio and/or television advertising will be too expensive when compared with the immediate results. However, it is recommended that you consider these media prior to special holidays.

Working with restaurants, supper clubs, bridal shops and the entertainment business in general, can bring in hundreds of referrals for you. Rubbing shoulders with, and circulating as a part of your area's civic and service clubs, should also result in more business for you.

Keep your eyes and ears on the alert. Wherever you go, and with whomever you associate, always be ready to promote and sell your services, if not on the spot, at least make a note to follow up when conditions are more in your favor. Promoting and selling your services will require at least half your time, and that's why two people operating catering services are so successful from the start.

The actual selling is quite simple so long as you emphasize the service and time-saving aspects.

The more time-consuming work you can handle for the client, the easier it's going to be for you to close the sale.

Handing out business cards is one of the least expensive ways to advertise, promote and sell your services. One enterprising caterer makes arrangements with the sponsors of all his parties, to see that each of the guests gets one of his business cards.

Another gives each of his clients a stack of his business cards, and tells them he will pay them $25 for each prospect they refer to him. He tells them to write their name on the back of the cards, and to hand them out to their friends. And then, whenever a person tells him that John or Jane suggested he call, and he presents the card with John or Jane's name on the back, this very successful caterer sends John or Jane a $25 check.

Another very successful caterer pays commissions to a group of housewives and college students who solicit - via their home phones - interviews for him with brides-to-be. They get their leads from announcements, and pictures of brides-to-be in the local papers.

Many caterers pay sales people a commission for letting them know when they hear about a party or special event being planned by one of their business customers.

The possibilities go on and on, and are seemingly unlimited. Time is becoming more valuable to a lot more people every day, which means there are more and more opportunities for great wealth and personal independence as a professional caterer. In reality, the success for just about any person entering this field, will be limited only by his or her own imagination and energy.

There is definite opportunity for great wealth within the catering field. Anyone with a sense of service to others can succeed. Very little "ready-cash" is needed to begin. Therefore, the only thing standing between you and the realization of your dreams, is the action it takes on your part to get started.

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