A Meeting Planner’s A Meeting Planner’s Guide to Catered EventsGuide to Catered Events

Chapter OneChapter One The World of CateringThe World of Catering

Who doesn’t like to eat Who doesn’t like to eat and drink? and drink?

When you plan a meeting, you want the When you plan a meeting, you want the food and beverages to be tasty and food and beverages to be tasty and abundant.abundant.

You want your attendees to leave feeling You want your attendees to leave feeling pleased that they were at the event. pleased that they were at the event.

Banquets and receptions Banquets and receptions are both social and business are both social and business eventsevents

People love to socialize and network.People love to socialize and network. All aspects of a catered function are All aspects of a catered function are

important.important. The quality of food, beverage, and The quality of food, beverage, and

service makes one of the deepest and service makes one of the deepest and most lasting impressions on meeting most lasting impressions on meeting attendees.attendees.

Groups generally prefer professionally Groups generally prefer professionally prepared and served food and prepared and served food and beverages.beverages.

This allows hosts to concentrate solely This allows hosts to concentrate solely on their personal, social, and business on their personal, social, and business activities while also enjoying the events.activities while also enjoying the events.

And they can leave the clean up to And they can leave the clean up to someone else. someone else.

Business Catering Business Catering association conventions and meetingsassociation conventions and meetings civic meetingscivic meetings corporate sales or stockholder meetingscorporate sales or stockholder meetings recognition banquetsrecognition banquets product launchesproduct launches educational training sessionseducational training sessions seller-buyer entertainingseller-buyer entertaining service awards banquetsservice awards banquets hospitality suites hospitality suites

Caterers come in all sizes Caterers come in all sizes and shapes. and shapes.

There are caterers who can provide There are caterers who can provide Japanese, Italian, French, Chinese, Japanese, Italian, French, Chinese, American, Southwest, and Seafood.American, Southwest, and Seafood.

There are picnic caterers, kosher There are picnic caterers, kosher caterers, and barbecue caterers.caterers, and barbecue caterers.

Your options are endless.Your options are endless.

Types of Catering VenuesTypes of Catering Venues

independent banquet independent banquet hallshalls

civic auditoriumscivic auditoriums stadiums, arenas stadiums, arenas ethnic social clubsethnic social clubs fraternal organizationsfraternal organizations women’s clubswomen’s clubs private city or country private city or country

clubs, athletic clubsclubs, athletic clubs hospitalshospitals universities, libraries universities, libraries

executive dining rooms executive dining rooms in office buildings or in office buildings or corporate headquarterscorporate headquarters

houses of worshiphouses of worship recreation rooms in large recreation rooms in large

housing complexeshousing complexes parksparks museums, aquariumsmuseums, aquariums restaurants with private restaurants with private

dining roomsdining rooms

Some facilities are more competitive than Some facilities are more competitive than hotels or conference centers, with more hotels or conference centers, with more flexible price structures due to lower flexible price structures due to lower overhead expenses.overhead expenses.

Public facilities are tax-exempt. Public facilities are tax-exempt. Some facilities provide their own catering Some facilities provide their own catering

in-house; others are leased to and in-house; others are leased to and operated by contract foodservice operated by contract foodservice companies that have exclusive contracts. companies that have exclusive contracts.

Some will rent their facilities to off-premise Some will rent their facilities to off-premise caterers.caterers.

Many meeting planners do Many meeting planners do not simply purchase a meal not simply purchase a meal

They buy fantasy, fun, service, They buy fantasy, fun, service, ambience, entertainment, and memories.ambience, entertainment, and memories.

Buying food and beverage is only one Buying food and beverage is only one component of the fun and fantasy.component of the fun and fantasy.

Much of what a caterer Much of what a caterer sells is intangiblesells is intangible

You cannot touch or feel an event before hand.You cannot touch or feel an event before hand. The caterer is selling something that has yet to The caterer is selling something that has yet to

be produced and delivered.be produced and delivered. It cannot be resold, restocked, or returned.It cannot be resold, restocked, or returned. People purchase what they "think" will happen.People purchase what they "think" will happen. It’s a gamble for them.It’s a gamble for them. They are nervous and need to be reassured They are nervous and need to be reassured

that they made the correct decision.that they made the correct decision. The caterer must create a sense of trust with The caterer must create a sense of trust with

his or her clients. his or her clients.

Catering is a consumer-Catering is a consumer-driven market driven market

Stimulated by clients who demand exceptional Stimulated by clients who demand exceptional quality and excellent value for a reasonable quality and excellent value for a reasonable price.price.

Value is determined by the buyer, not the Value is determined by the buyer, not the seller.seller.

Buyers’ perceptions are sellers’ realities.Buyers’ perceptions are sellers’ realities. The impression meeting planners have of a The impression meeting planners have of a

property’s catering ability is their reality, and property’s catering ability is their reality, and will influence their buying decisions. will influence their buying decisions.

Most meeting planners Most meeting planners will comparison shop will comparison shop

They make the best choice when they They make the best choice when they perceive a facility is reliable, consistent, perceive a facility is reliable, consistent, creative, and can execute the best quality creative, and can execute the best quality event consistent with what they are able event consistent with what they are able to pay.to pay.

The caterer must be able to The caterer must be able to take a meeting planner's take a meeting planner's vision of the function vision of the function (needs, wishes, purpose of (needs, wishes, purpose of the function, and budget) the function, and budget) and develop an event that and develop an event that can be delivered effectively can be delivered effectively and efficiently. and efficiently.

Catering staff Catering staff Director of catering (DOC)Director of catering (DOC) Assistant catering directorAssistant catering director Catering managerCatering manager Catering sales manager Catering sales manager

(CSM)(CSM) Catering sales representativeCatering sales representative Convention/conference Convention/conference

service managerservice manager Banquet managerBanquet manager Banquet setup managerBanquet setup manager Assistant banquet managerAssistant banquet manager SchedulerScheduler Maitre d’ hotelMaitre d’ hotel CaptainCaptain

ServerServer Busperson (busser)Busperson (busser) Food handlerFood handler BartenderBartender BarbackBarback SommelierSommelier HousemanHouseman AttendantAttendant Clerical personClerical person EngineerEngineer CashierCashier Ticket takerTicket taker SecuritySecurity Room service managerRoom service manager

How caterers price How caterers price

Three general types of pricing methods Three general types of pricing methods used by caterers: used by caterers: thirds methodthirds method contribution margin (CM) methodcontribution margin (CM) method multiplier methodmultiplier method

The thirds methodThe thirds method Calculating a per-person price that will cover Calculating a per-person price that will cover

three things equally: three things equally: 1.1. the cost of food, beverage, and other supplies (such as the cost of food, beverage, and other supplies (such as

napery, dance floor, etc.);napery, dance floor, etc.);2.2. the cost of payroll to handle the function, plus overhead the cost of payroll to handle the function, plus overhead

expenses needed to open the room (such as turning on expenses needed to open the room (such as turning on the air conditioning units, etc.); andthe air conditioning units, etc.); and

3.3. profit.profit. With a $30.00 price per-person, the caterer will With a $30.00 price per-person, the caterer will

have approx. $20.00 to cover expenses, leaving a have approx. $20.00 to cover expenses, leaving a $10.00 profit from each guest. $10.00 profit from each guest.

The caterer will also add taxes and gratuities (or The caterer will also add taxes and gratuities (or service charges) to this price. service charges) to this price.

The contribution margin The contribution margin (CM) method (CM) method

This is the typical pricing method used by This is the typical pricing method used by large caterers.large caterers.

Everything must make a profit.Everything must make a profit. It is too difficult for large caterers to build It is too difficult for large caterers to build

each party from scratch, so it is each party from scratch, so it is necessary to standardize some things. necessary to standardize some things.

The contribution margin The contribution margin (CM) method (CM) method

The caterer must know as much as The caterer must know as much as possible all the expenses associated with possible all the expenses associated with “opening the room,” apart from the types “opening the room,” apart from the types of menu items meeting planners will of menu items meeting planners will order.order.

These are essentially fixed catering These are essentially fixed catering expenses, such as salaries and wages, expenses, such as salaries and wages, utilities, paper products, and marketing. utilities, paper products, and marketing.

The contribution margin The contribution margin (CM) method (CM) method

These total fixed expenses must be divided by These total fixed expenses must be divided by the number of attendees expected for a year.the number of attendees expected for a year.

This gives the caterer a reasonable estimate of This gives the caterer a reasonable estimate of the amount of fixed expense per attendee.the amount of fixed expense per attendee.

To this number is added the per-person cost To this number is added the per-person cost for the food, beverage, and other variable costs for the food, beverage, and other variable costs (such as special linen) that comes with a (such as special linen) that comes with a particular catering menu option.particular catering menu option.

The contribution margin The contribution margin (CM) method(CM) method

Once the caterer knows how much the Once the caterer knows how much the total variable and fixed expense is per total variable and fixed expense is per person, the desired profit margin is then person, the desired profit margin is then added to each menu option. added to each menu option.

The multiplier methodThe multiplier method

This is a version of the contribution This is a version of the contribution margin (CM) method. margin (CM) method.

Once it is established, the caterer then Once it is established, the caterer then multiplies it by a factor that usually varies multiplies it by a factor that usually varies from about 3 to 7, but can go higher from about 3 to 7, but can go higher

The multiplier methodThe multiplier method The factor is related to the type of services, The factor is related to the type of services,

ambience, and so forth, provided to attendees.ambience, and so forth, provided to attendees. The more expensive, the higher the factor will be.The more expensive, the higher the factor will be. The factor can be independent of these variables; The factor can be independent of these variables;

during the high season, even modest caterers can during the high season, even modest caterers can command a high price.command a high price.

The factor, and the price, are influenced by The factor, and the price, are influenced by competition and what the market will bear.competition and what the market will bear.

It will be as high as possible.It will be as high as possible. To the caterer, there is no such thing as a price that To the caterer, there is no such thing as a price that

is too high.is too high.

Popular Up-scale Value Based

Chicken per-person

Picatta$ 24.00

Oscar$ 32.00

Dijon$ 22.00

Staff B-team $500.00

A-team $700.00

C-team$400.00

Linen Color Overlays White

Chair rental Stacking$850.00

Ballroom$1400.00

Padded$600.00

Floral Roses$400.00

Orchids$600.00

Carnations$300.00

Music Duo$550.00

Trio$750.00

Solo$375.00

Level pricingLevel pricing

Range pricing Range pricing

Prime Rib Dinner Number of guests Price per guest

235 or less $29.75

236-265 $27.45

266 and up $24.25

The caterer’s objectivesThe caterer’s objectives Earn a fair profit, consistent with the Earn a fair profit, consistent with the

amount of money invested in the catering amount of money invested in the catering business.business.

Generate sufficient catering sales Generate sufficient catering sales revenues to accomplish the above, to revenues to accomplish the above, to cover all operating expenses, and to cover all operating expenses, and to have enough money left over to reinvest have enough money left over to reinvest in the business.in the business.

Ensure customer satisfaction.Ensure customer satisfaction.

The caterer’s objectivesThe caterer’s objectives

Provide consistent quality and service.Provide consistent quality and service. Convey a particular image.Convey a particular image. Develop a reputation for dependability, Develop a reputation for dependability,

flexibility, and solving problems.flexibility, and solving problems. Stay on budget.Stay on budget.