| Catering entrepreneurs make a number of mistakes in | | | | that impact one market but not the other. You can |
| their business. The results range from company failure | | | | also prevent too much of your business from coming |
| to depressing revenues or increase costs dramatically. | | | | from a few large area businesses by serving private |
| These are three mistakes that are specific to the | | | | parties as well. |
| catering business. | | | | Buying Too Much Equipment |
| Working in an Unlicensed Kitchen | | | | When you launch your catering company, only buy |
| It is illegal to run a catering business out of just any | | | | equipment that you are certain you will use |
| kitchen, and certainly out of a home kitchen. While you | | | | consistently. Keep in mind that event rental equipment |
| may not run into trouble at first, or even for a long time, | | | | companies exist, and you can build a relationship with a |
| if someone should ever become sick from your food | | | | rental company guaranteeing a discount for your |
| and you are sued, your insurance company can refuse | | | | orders. This can make it possible to lower the cost to |
| to cover you if you were operating illegally. | | | | your customers while expanding their options for |
| Furthermore, you could be shut down by the local | | | | chairs, tables, tablecloths, silverware, etc. |
| health department at any time for working out of an | | | | If you buy too much equipment up front, you tie up a |
| unlicensed kitchen. For an aspect of your business that | | | | lot of your capital in these assets and may later find |
| is so key to its success, make sure that you take | | | | out that they are not the pieces that customers value. |
| every step to operate on the up and up. | | | | Operate for a while before buying more than the basic |
| Ignoring the Private/Corporate Balance | | | | equipment and then only buy the equipment when you |
| If you choose to serve only individuals or only | | | | see you have had to rent it multiple times. Plan your |
| businesses, you may simplify your marketing and save | | | | capital purchases carefully and spread them over time |
| on some expenses in the short term. However, you | | | | so you can fund them with the company's earnings. |
| will find at some point that you are missing out on | | | | You should either charge the same prices for the |
| business that will help your kitchen remain utilized more | | | | item's use as a rental company would and keep the |
| often if you serve only one of these markets. By | | | | eventual profit, or charge a lower fee if it will |
| balancing service to both, you hedge against trends | | | | encourage more sales in the long-run. |