So many people look at the small cafes and tea rooms around the country and think they could do a better job running them that the present owners do.
However, to the uninitiated, the catering business can seem like something that would be easy to make a profit in, but the reality of is often quite different.
In fact, running a viable food business is pretty tough, so keep reading for some tips on how to ensure that you succeed.
Price by market and cost
To have a viable catering business, you need to set your prices at just the right point. That means you have to look at both the cost of your ingredients and overheads, as well as what others in your market are charging for similar things.
Obviously, your price needs to cover your costs, but also allow for a margin of profit as well. Yet items still must be priced competitively to attract customers. It’s a difficult process that needs to be evaluated and adjusted regularly.
Lower your overheads
In catering, there are a lot of overheads. You have the ingredients, premises, utilities, wages and cleaning to pay for. This can all add up and seriously eat into your profits.
That is why it’s a good idea to lower your overheads where you can. This must be done carefully as there are many standards that need to be adhered to in the food business, so it’s important not to compromise any of those.
It may be possible to save some money in the long run by investing in new types of equipment like one of these combi ovens, that use much less energy than a traditional oven. So they will end up costing you less.
You can also save money by monitoring and limiting food waste as much as possible. Obviously, any food that has been out for a customer and comes back to the kitchen must be thrown away.
But you can encourage your employees to be more careful while preparing and plating the food. As well as keeping up with the stock rotation as this can cut down the amounts that are thrown away unnecessarily.
Small catering and food businesses often succeed or fail on the hard work and dedication of their staff, and this is something that employers need to remember when dealing with their employees.
As it’s unlikely that you will be able to pay much more than the minimum wage, you must have a realistic expectation of the people that are working for you.
It’s your business, so it’s totally understandable if you want to break you back working for it, but to expect everyone else too for little reward is just going to create tension and strife.
That means you need to carefully select your staff, ones you know will work hard. But also be reasonable with them to preserve your long term working relationship.
Something that smaller catering business can experience when they have been going for a while, is that interest from customers drops off after a certain amount of time.
To combat this, run customer promotions like stamp cards or free items at a time when businesses in slow. As this should help you to maintain interest and so make your business more viable.