Creating A Successful Catering Operation
This Side Business Can Help Your Bottom Line … If Executed Correctly
Operating as only a full-service restaurant can take a toll on an establishment’s bottom line—especially during challenging economic times—so it’s no surprise that a number of restaurateurs have considered launching catering businesses on the side.
In 2013, Denver-based Chipotle Mexican Grill debuted a catering business, allowing groups of 20 to 200 to customize meals at home, school or the office as they do when they’re at the front counter. And Scranton’s in Mississippi has always devoted 35 percent of its operation to catering. Owner Richard Chenoweth maintains that this dedicated side business has kept his operation profitable even when the dining side was down during recessions.
According to statistics portal Statista.com, restaurant food and drink sales in the United States exceeded $683 billion in 2014, with $8.67 billion generated by the catering industry. A large percent of that number came from independent catering companies and restaurant private dining caterers. But is it really that easy to launch a catering operation if you’ve already got a menu, staff and facility in place?
“Any type of restaurant can successfully run a catering operation as long as they have the space to execute it,” says James de Marte, owner/operator of Chicago-based JDM Culinary Consulting. He continues, however, to clarify that the catering aspect of a foodservice operation should be part of the initial business plan.
“That way your infrastructure (equipment, space, etc.) could already be there when you are ready to start up operations. If a restaurant is ‘backing in’ to catering operations, meaning it was not part of the original business plan, an established restaurant would have the best chance at being successful. They would already have an established clientele, people already familiar with the product, they could approach.”
De Marte regularly collaborates with restaurant clients who are looking to incorporate catering into their operations. Many are looking to establish in-house catering, banquet and private dining. He says that most are hesitant to delve into off-site catering because that requires a lot of organization, space and logistics. It’s also quite expensive to pull off.
“If you are going to do it, do it right,” he advises. “If your catering operation was popped up as an afterthought, you will work 10 times as hard, you will spend your time putting out fires, you will disappoint your clients, you will fail. You will be eating the rubbery chicken breast your client refused to pay for.”
For those willing to take the plunge into the catering side of business, De Marte says if executed correctly the end result should be profitable within a few years. “Catering can finance a whole foodservice operation and allow a chef and restaurant to offer items without too much concern over food costs,” he maintains. “Realistically speaking, in three years you should be established and maybe making some money—paying your bills, at least.”
De Marte also regularly works with his wife, Rachel, on special events projects and weddings that take place in some of Chicago’s most popular restaurants and special events venues. Her company, Rachel De Marte Events, focuses on front-of-house operations with menu planning and sales strategy. According to Mrs. De Marte, each event is different and should be treated as such to make each client feel special.
“There is an art to it,” she explains. “You have to tailor to the type of event: Corporate, non-profit/gala and weddings are very different; rarely would you suggest the same menus for each. There is also the major difference between on-premise and off-premise catering. Are you only catering in-house as you have an event space onsite? Or will you plan to go all over town?”
Mrs. De Marte also recommends hiring additional staff for the dedicated catering division, and stresses the importance of bringing aboard people who have catering experience. “The art of servicing a party of any size requires a different skill set, different knowledge, than in restaurant world,” she explains. “Food is served differently. Bars are set up differently. Product is ordered and stored differently. Off-premise events mean that all has to be brought in, set up and torn down that same day. It’s the largest form of organized chaos there is.”
The easiest part, she adds, is when the restaurant incorporates an existing menu into a catering menu. She suggests taking the current menu and melding it into event-friendly food. For example, she says, shrink an entrée size crab cake and tweak the presentation to be “one pretty bite.”
“You are already ordering the product for these, just changing the way you execute it,” she says.
Here are some additional tips to follow for those considering jumpstarting a catering business on the side:
- Growing a catering business requires the same consistent marketing as running a restaurant. Draw attention to your service in menus and brochures and on table tents. Create a page for it on your website. Raise awareness through social media, mobile devices and e-mail marketing campaigns.
- Software programs such as Caterease are available to assist you with planning, sales, booking and marketing. Many programs can generate letters, quotes and invoices as well.
- With the proper equipment and staff, you can offer whatever you want. Sanitation is always at the front of mind while catering. If you have the means to transport your ingredients safely, without compromising quality and you have a motivated staff ready to build a pop-up kitchen at will, you can offer up anything.
- Staff should be well-versed in what they are serving and able to answer questions about allergies and dietary restrictions from guests. They should also know how food items must look on each tray, platter or plate, times 100, 500 or 1,000.