Considering expanding your services to include catering options? If you have a popular kitchen, it’s a great idea to offer catering as well.
The last few years have been rough for the restaurant industry, and it could get worse before it gets better. But one aspect of the food industry is bouncing back strong – the catering market. The U.S. catering market hit $10.6 billion with 11.4% growth in 2022 and is expected to continue to grow. So expanding your service to include catering might be just the boost your restaurant needs. Here are eight ideas to help you build a catering business that fits your style and matches your capabilities.
1. Pick A Restaurant Catering Business Niche
With events and gatherings back in full swing, consumers are sick of homemade sourdough bread and ready to bring in professional help.
Stick with your core branding by taking your signature dishes on the road and bringing your flair everywhere you go.
Beyond your food itself, the niche you’re looking for is size. Caterers provide food service for big and small events, from backyard weddings to huge corporate gatherings. So decide where you want to fall on the scale – 10-20 guests up to tens of thousands – and make all your decisions from there.
2. Assess What You Have And What You Need
When choosing a niche, your first considerations should be your existing assets and allocations, including staff, general restaurant equipment, and how much time you can afford to tie up your kitchen without interfering with your daily operations.
For example, you may decide that you can only cater events on your slowest days or when you are closed. Or, if you run a dinner-only restaurant, you may be able to cater breakfast and lunch for local businesses and small events from your restaurant kitchen.
Storage space may play a big part in helping you decide whether to cater for large or small events. Unless you’re planning to expand to a separate kitchen facility, you’ll need enough room to store your standard fare plus the extra food you’ll need to start a restaurant catering business.
You’ll also need the space, kitchen equipment and supplies, and a crew to clean up after a catering event.
Suppose you are ready to expand into the restaurant catering business and want to go after big events. You may need to invest in a separate kitchen facility with dedicated staff, restaurant catering equipment, and utensils.
3. Choose A Type Of Catering Business
Catering businesses come in different varieties or formats. For example, some caterers prepare food and drop it off. Some caterers start with an empty room and set up everything, then serve guests a pre-selected meal on a plate or let them choose from a buffet. Full-service catering businesses may offer alcohol, beer, and wine with meals.
Ghost kitchens are also a popular restaurant trend. Restaurant kitchens with no seating for diners partner with local bars, hotels, or event venues to serve food at their locations.
Some caterers bring their kitchen to the venue with a fully-equipped food truck or a BBQ smoker that allows staff to prepare food onsite.
In most cases, you will need catering staff, including cooks, servers, and cleaning staff. In addition, you’ll need people to transport food and equipment and set up and tear down tables and stations. You may be able to rotate some of your existing staff into these positions, but odds are you’ll need to hire and train a separate staff.
4. Obtain Catering Licenses And Permits
You must file additional catering paperwork even if you have an established restaurant. Check local and state requirements to ensure you’re in compliance.
Typically, licensing and permits include:
- Sales license
- Food handler license
- Catering license
- Health Permit
You’ll also need a health and safety inspection, and if you plan on providing bar service, either an alcohol or beer and wine license.
You can’t always get permits simultaneously; each step will have filing deadlines. Before you begin the process, ensure you understand each application’s timeline, sequence, and deadlines. A business law attorney can help you sort it all out.
5. Build A Catering Menu
Catering menus are much different from full-service restaurants. They typically offer limited choices and are often designed with food safety and convenience in mind. Using your signature restaurant menu as a starting point, here are a few basics to consider:
- Make-Ahead Convenience: While it would be perfectly normal to make and serve 200 covers in your restaurant, you may need access to a kitchen for some catering jobs. Most dishes, if not all, must be prepared in advance. Choose foods that will be delicious after reheating.
- Food That Travels Well: You’ll need a mode of transportation, like a van loaded with rolling racks and food that can survive transportation.
- Onsite Cooking: Many caterers serve pre-prepared food in chafing dishes and also offer wok, omelet, or grill stations for freshly prepared food.
- Cold Dishes: One way to handle the cooking or warming issue is by limiting your menu to chilled food, like sandwiches and salads.
- Good Profit Margins: Quality and healthy profit margins are crucial. Ensure the dishes you serve are appropriately priced and balance expensive items with dishes that look and taste great but are profitable to produce.
Offering a variety of hot and cold dishes reduces the onsite workload. Cold menu items can be prepared in advance and served without additional prep. Hot dishes require more time and consideration. Balance the workload and offer a better variety of dishes by providing both.
To make your catering menu work, choose foods closely related to your brand that can be reheated or recreated at any venue without losing flavor, presentation aesthetic, or food safety.
6. Outfit Your Business With Catering Equipment And Utensils
While you won’t always need it, your restaurant catering business should be prepared to provide everything needed for dinner service, from dining tables to serving spoons.
Here’s a list of essential restaurant catering equipment and utensils according to Restaurantware:
- Commercial catering vehicle
- Insulated food pan carriers
- Countertop induction cookers
- Chafers & chafing dishes
- Tables/chairs/tablecloths
- Serving equipment
- Hand truck
- Outdoor coolers
- Insulated beverage dispensers
This list is not comprehensive and is in addition to the general restaurant equipment needed to prep and cook the food at your location.
7. Get Comprehensive Insurance
Many risks are associated with catering. In addition to burns, cuts, or slip-and-fall accidents common to food service environments, food kept at the wrong temperature could make people sick. There are also general risks, such as natural disasters, fires, floods, theft, vehicle accidents, and other things that result in personal or property damage.
Find an insurance agent who knows the catering business and can write a policy to cover the specific risks and ensure you’re fully covered in the kitchen, on the road, or at remote venues.
8. Market Your New Restaurant Catering Business
Start with the most apparent customers – your regulars. Existing customers know and love your food, so let them know you’re going to open a catering business. Post on social media, email your mailing list and hand out flyers to guests.
Other effective marketing options include:
- Invite local news stations and talk shows to run a story, host a cooking segment, or pitch a special with advice about preparing food for holidays or weddings. Local programs are always looking for interesting feature stories.
- Join a showcase event, like a “Taste of [your city].”
- Donate meals to a charity event or drive.
- Offer low-cost catering for a political event or fundraiser in exchange for publicity.
Target your audience. Partner with the local symphony, theater, botanical park, or museum if your patrons are older. Consider festivals, concerts, business organization meetings, or marathon events to reach a younger crowd. If your focus is burgers and your customers are families with kids, contact your local Pop Warner league or area high schools and offer to provide food for their homecoming game, with a percentage of sales going to the organization.
Restaurant catering services provide an excellent additional revenue stream for your business. No matter where you’re located, people throw big parties, get married, and put together company or corporate events.
An established restaurant gives you a leg-up on the competition because your reputation precedes you. And always remember that customer satisfaction is the key to success, whether in your restaurant or catering at a remote location.
