You may have the best cooking skills and the most advanced cooking equipment to date but catering is still a fiscal venture and your revenue will define the success of your catering business. This means you should know how to budget your overall business and each event. This gives you an overview of your expenses and revenue. This will also help you not only determine the minimum needed costs on hosting an event but also to efficiently calculate your markup value of your services to clients. Read our blog to learn how to budget your catering business.
Itemizing through a Spreadsheet or Chart
You should list and categorize each of the food and beverages for your menu. It doesn’t have to be overly defined or meticulous. It should show just the basic costs of your service. You should use columns for actual cost per serving and charged cost per serving.
The Markup Value
As a common practice, it can be very beneficial to the caterers to charge three times the actual cost for their final pricing. If a dish will cost you $3 per serving to make, the charge should be $9 per serving. This charge should be calculated and placed under charged total costs per serving. By charging the right amount for your food and services, you're set to run the best catering business in town.
Staffing and Venue
Now that you have your charged cost for the food, you should be aware of the expenses to hire your staff, essential catering supplies, and for using the venue that was chosen. This means tracking the fees in hiring staff and also facility expenses if you’re also the one providing the venue for your client. It's up to your own discretion as to how to effectively budget the staff.
Every location has a government-decreed tax in place. You are a business and will often have the right to charge tax. You should be informed of the tax rate and all the permits required to own a catering service to avoid confusion. You should multiply the bill total by the tax rate given to figure out how much tax is needed for that said event.