There are around 139,060 catering businesses in the U.S, which shows it’s an attractive venture for many foodies.
Opening a catering business lets you capitalize on your passion and solidify yourself as an industry expert. Perhaps you’ve toyed with the idea of opening your catering business, but you’re not sure how to turn your dream into a reality.
Sounds like you? Don’t worry, you’ve come to the right place. Here is everything you need to know.
Choose a Niche
As a small business owner, your first goal is to determine your niche. Not all catering businesses are the same, so make a list of the meals you enjoy making. For instance, you may prefer serving brunch-inspired food like tiny sandwiches, quiches, and salads.
You may also want to cater for weddings, where you serve an array of appetizers, delicious entrees, and baked desserts. Or, if you’d rather cater for classy soirée, then brainstorm eloquent starters and cocktails to satisfy the guests.
Create a Business Plan
To become a reputable local catering company, you must create a detailed business plan. This is where you crunch numbers and ensure that your finances can cover at least six months of expenses.
Make sure you keep your overhead costs low at the beginning so you have a headstart. For instance, contact catering equipment suppliers to find affordable appliances for your kitchen. You should also decide whether you need a business loan or if you can start a new catering company on your savings.
Apply for a Business License
Before you can celebrate your business ownership, figure out which licenses you need. Note, every state has its requirements, so research to avoid any penalties.
In general, most businesses in the catering industry need a local business license to legally operate. You will also need a catering permit, which is approved by a health inspector. And if you want to serve booze, then apply for an alcohol permit too.
Create a Business Structure
Another important aspect to consider is your business structure. Although it’s easier to apply for a sole proprietorship, it’s wise to become a limited liability company (LLC) as it protects your personal assets, should an issue happen with your business.
Once you’ve decided which one works for you, register for an Employer Identification Number (EIN) as it’s key for filing your taxes. Then, open a business banking account as it will help you track your spending and keep your finances streamlined.
Get Catering Business Insurance
Getting insurance for your catering business is crucial as it protects you, should a problem arise. Start by applying for general liability insurance as it covers a range of accidents like slip-and-fall incidents.
If you’ve got a team, then invest in workers’ compensation to cover your business associated with any occupational injuries.
Build Relationships With Vendors
As a catering business, you must nurture relationships with vendors. In the beginning, it’s easier to use a local wholesale store to buy your food, but as your business grows then work for a larger supply company as it’s more efficient.
But note, catering is more than food. You must also work with vendors who can provide silverware, linen, and utensils until you can afford your own. Make sure you shop around local vendors in your area, so you can determine the best price, especially when you’re starting.
Hire an Experienced Team
In the beginning, you’ll likely handle smaller events on your own or with a partner. But when you book larger events, it’s important to have a team of reliable employees who have experience in the industry.
For instance, if you’re offering a buffet then you’ll need several team members to manage it. This compares to a sit-down meal, which needs more staff to keep guests happy.
Promote Your New Venture
Regardless of whether you’re a marketing whizz, you must promote your business. One of the most effective methods is through digital marketing, where you build an online presence, so prospects can contact you via social media.
If you haven’t landed clients yet, then show off your food with professional photography. You could include one of your famous cheesecakes as the centerpiece of an array of smaller portions to showcase your talent.
Gather Online Reviews
A staggering 97% of consumers read reviews of local businesses, which highlights the power of reviews. Because of this, you must work hard to gather a collection of positive feedback so prospects know you’re worth their time and money.
For instance, after the event, contact the client and ask whether they could leave a positive review. You could also, with their permission, upload photos from the events and tag them to show you offer a fantastic service.
Brand Your Delivery Van
One of the most cost-effective methods of marketing is branding your delivery van. Make sure your work-related vehicles are pristine and in good condition to set a winning first impression.
To get results, display your logo prominently and include your contact details, so prospects can easily reach you. Note, if you change your branding, then don’t forget to alter your van to ensure it’s cohesive.
Open a Catering Business Today
Hopefully, after reading this article, you’re confident about opening a catering business.
Start by choosing a niche, create a business plan, and apply for the right licenses. You must also get insurance, build relationships with vendors, and create an effective marketing campaign to reach new clients. Good luck with your venture!
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