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How to Start a Profitable Catering Business

Being a chef is an exciting career. It’s fast-paced, creative, loud and can cause even the most accomplished to break a sweat and get buried under a mountain of orders. That’s why so many trained chefs and talented home cooks turn to catering. While it might seem like the perfect culinary respite, professional catering shouldn’t be done on a whim. It’s a tough business that requires expert management, keen business acumen and brand-building skills, in addition to knowing how to create a variety of meals and desserts.

The Benefit of Starting a Catering Business 

Every chef might dream of owning a restaurant and getting five-star reviews. Granted, catering doesn’t deliver on these things but there are a lot of benefits. Here are a few benefits of starting a catering business instead of a restaurant. 

  • Lower overhead costs compared to restaurants.
  • It’s feasible to run a catering business out of your home.
  • It takes less time to turn a profit.
  • You can adapt a catering business, including the menu, as needed.

If this sounds appealing, let’s look at some of the steps you can take to successfully start your own catering business.

How to Start a Catering Business

There are a variety of steps to starting a catering business. The first step is to decide if you’re going to work on-site or off-site. On-site means you cook and prepare the food at the event space whereas off-site requires you to do everything at one location and then transport the food to the event. This decision will dictate the next steps. 

Research Local Laws

Most businesses, including home-based ones, are heavily regulated. Contact your local government official to understand if it’s legal to operate a food service business out of a private residence. You should then turn your attention to health department guidelines. These cover food handling and storage measures along with other rules you will have to abide by.  

Familiarize yourself with these laws as failure to do so could result in your catering business being shut down. 

Shopping for Equipment and Supplies 

You can spend days and thousands of dollars in a kitchen supply store. To start a profitable catering business, you want to take a strategic approach to outfitting your business with the equipment and supplies needed to get it up and running. 

Here are some of the necessary pieces of equipment that most catering businesses needs to start taking on clients:

  • The right vehicle to transport commercial goods. 
  • Chafing dishes to present or serve food. 
  • Indoor and outdoor coolers, which are necessary if you work somewhere without access to a refrigerator (it’s a possibility).
  • A full set of pots and pans.
  • High-quality kitchen utensils and appliances like blenders, hand blenders, cutting boards and rice cookers, to name a few.
  • For home-based catering businesses, you should invest in a top-of-the-line dishwasher, oven, ventilation system and maybe even a beverage centre for wine. 

For more information on how to round out your initial shopping list, check out this list of essential catering equipment. And don’t forget, there will also be marketing expenses like a website, business cards, ads and however else you plan to get the word out. 

Know Your Numbers

You might be an amazing chef and a world-class baker, but your catering business requires you to be an astute business operator. To run a successful business out of the gate, you need to have accurate projections (nothing wishful) and keep track of your profits and expenses. 

You can use Freshbooks® or Quickbooks® for your accounting, invoicing, and expenses. Of course, there are other software options, or you can elicit the help of a professional accountant or bookkeeper. It comes down to how comfortable you are doing your own accounting and how much time you can devote to the process. Be prepared for this task to cut into other aspects of your operation.  

The bottom line is that to start a catering business that can turn a profit, you need to manage your finances long before you take on clients. 

Are You Ready to Become a Caterer?

Being a successful caterer is tough work and it’s not for everyone. It requires dedication, resourcefulness and a knack for customer service and marketing. If you’re ready for that giant leap toward catering, then the best advice is to move slowly, have the right strategy and be prepared for the rigours of building a business from the ground up.

Rob Shapiro | Contributing Writer

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