If you are a start-up caterer, or you’ve just opened your catering firm, chances are, you have a very limited knowledge as to how much to charge your clients. Surely, it shouldn’t be too cheap that any profit is already negligible, nor should it be too expensive that clients will balk at hiring your service. Indeed, pricing is really crucial since it will determine your business’ profitability and over-all financial stability. That is why, any freshman caterer should spend some time to learning the trade of catering event costing so that the next time a client asks how much will it cost him to feed 60 or so people, you won’t play guessing games, but rather have a solid, reasonable figure to equate quality service with just the right cost.
Take note of the details of the event
A lot of caterers would often make the mistake of giving the wrong quotation only to tell the client later that there’s been an increase on the fee since some details were not included in the previous plans. Before you offer your price, always take time to sit down and discuss the details of the event with your client. Make sure you jot down everything that he’s been telling you and make sure everything is itemized and well-spelled out in the contract.
Breaking down the cost
The usual catering proposal has to be itemized according to the following details: menu, beverages, rental charges, and staffing. Any additional expense, including taxes, of course, will have to be included, too. Qoutify.com http://www.quotify.com.au/catering/buyer-guides/Catering-Costs-and-Budgeting-Advice suggests offering a package deal where everything, from menu and drinks to staff and equipment rentals are all-inclusive of the price that you’ll be asking. Of course, don’t forget to specify everything that’s going to be included, from the basics, down to the extras and freebies.
Do the head count
If you think that a package deal is not an ideal option, then try pricing your service based on the number of guests that your client will be having. Tell your client that every set has a minimum and maximum number. Offer your price on a cascading manner, like offering a per head cost between 50 to 100 people, while offering a little discount for guests between 100 and 200. On the other hand, try giving a larger discount if guests number between 200 and 400 people.
Research the market rate in your area
The food service industry has a highly competitive landscape and clients will always go for the one that offers them the best value for money. That’s why, try to conduct a market research in your area to see what’s the usual going price for the caterers.
And don’t forget this…
See to it that you thoroughly read the details of your contract before signing a deal with your client. Also, make sure that you have informed your client of all additional charges. What you’ve discussed verbally should be well-stated on paper so that everything is transparent and that you have your recourse should your client raise any issues with regards to your service. Always, always write down the costing, have it checked and signed by your client to protect your interest, as well as make sure that he gets only the best service that you can offer.