Setting Up a Business in Catering

As with any small business, setting up a business in catering will require a financial investment. Some individuals are fortunate and have start-up funds available, which others must use their home to secure financing.

It is often said “with great risk comes great reward,” and using one’s home as collateral is no exception to this rule. Starting a catering business brings the opportunity to create financial security, but it also brings financial risk. With this in mind, it is very important to to never risk more than you can afford to loose.

How much money is generally required for starting a catering business? Generally speaking, starting a catering business requires about $2,000, which includes start-up supplies, equipment and required local licensing. Before you can open for business, at minimum you will need a business license, a food handler’s permit and tax ID number. Tax ID numbers are assigned through the IRS. Contact your local courthouse or city officials for information about obtaining a business license and food handler’s permit. If you plan on service alcohol, you will also need to secure a liquor license.

Start-up expenses, such as advertising and equipment, will vary depending if you want to start with the basics and grow your business or if you want to start with a larger business setup. Advertising alone will require a minimum investment of $500 to $1,000. When just getting started in your catering business, most likely it will take a while to get established and to make a profit. It is very important to make sure you have enough savings to support yourself until you having your business up and running.

For most people who start a catering business, the food preparation is the fun part of the business. After all, it’s creative, exciting and challenging. But owning your own small business means you must also attend to the business side of running your business including bookkeeping, marketing, staffing and office administration. While you can do all these things yourself, as soon as possible it really is better to hire someone with expertise in each of these areas to handle the related responsibilities. No one can successfully be a master of trades.

Acquiring new clients and sales is important to the survival of any business. For any service and people oriented business, being a true “people person” is a must. This means having the ability to interact with people from all walks of life, at all levels of business in a way in which they feel comfortable with you and also have confidence in your abilities to get the job done successfully. You will be expected to know your clients wants and needs before they do. Excellent and personable communication skills are a must.

Perhaps a the moment you are feeling a little nervous or unsure about the skill required in setting up a business in catering. The best way to gain confidence in your abilities is preparation. Talk with small business owners about their experiences, both their successes and their failures. Starting a small business, no matter what industry or area of expertise, has many of the same responsibilities and challenges.


And finally, the best preparation for setting up a business in catering is experience. Check your local community college for courses in hospitality or service management. Moonlight with a local caterer or banquet center to get real life, hands on experience in the industry. If you are fortunate, you will gain a lot insight on both what it takes to be successful and at the same time learn from others mistakes without having to risk your own financial security or new catering business

Check Also

How to Enroll in COBRA Insurance: A Step-by-Step Guide

How to Enroll in COBRA Insurance: A Step-by-Step Guide Blueprint of COBRA Security The Combined …