{"id":37026,"date":"2024-07-31T11:51:57","date_gmt":"2024-07-31T11:51:57","guid":{"rendered":"https:\/\/swoopfunding.com\/us\/?post_type=start-a-business&p=37026"},"modified":"2025-09-26T14:07:39","modified_gmt":"2025-09-26T14:07:39","slug":"start-a-catering-business","status":"publish","type":"start-a-business","link":"https:\/\/swoopfunding.com\/us\/start-a-business\/start-a-catering-business\/","title":{"rendered":"Start a catering business"},"content":{"rendered":"\t\t
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No doubt about it, America loves a big event, which is why it\u2019s no surprise that the US catering industry was worth more than $72 billion<\/a> in 2023. Whether you\u2019re catering to high-end clientele, a small private party, or a corporate sales promotion, there\u2019s profit to be made by selling food and drink.<\/p>

Starting a catering business can put you firmly on the path to financial success, but how do you get there, what hurdles must you cross and most importantly, what will it cost? Let\u2019s find out. Read on to discover all you need to know about launching your own catering operation.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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\n\t\t\t\t\t\n\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\tGet a quote<\/span>\n\t\t\t\t\t<\/span>\n\t\t\t\t\t<\/a>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
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How to start a catering business in 9 steps<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Before you even begin to get your new catering business off the ground, you\u2019ll need to decide the fundamentals:<\/span><\/b><\/p>

Do I start from scratch, or should I buy an existing catering business?<\/b><\/p>

Starting from brand-new gives you the chance to shape your catering business exactly as you want it and avoid the hassle of modifying an existing operation to your tastes. However, the downside to this route is time. Starting fresh means building your customer base and brand presence from zero and that could take longer than you think, especially if you\u2019re competing with well-established rivals. In contrast, buying a going-concern allows you to hit the ground running, with an oven-ready customer list and brand recognition \u2013 but the downside to this route is cost. It may be significantly more expensive to buy an existing caterer than it is to start from scratch.<\/span><\/b><\/p>

Who are my customers and what kind of services should I offer?<\/b><\/p>

Determining who your customers will be will help you shape your business plan and arrange your financing. If you\u2019re going to pursue high-end events such as banquets or lavish weddings you\u2019ll probably need to spend more on marketing, equipment and staff training than you might if you are going to pursue corporate clients who typically want a streamlined service and an understanding of B2B catering requirements. You could also chase light-catering gigs where you limit your offer to finger food and cocktails. Speed, cost-efficiency and flexible staffing are essential to succeed in the economy end of the catering market.<\/span><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Step 1: Choose your business name and business entity type<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Once you know what kind of business you want to operate, you\u2019ll need to choose a business name that\u2019s memorable and gives customers an idea of your services. (If you\u2019re buying an existing caterer, you may want to keep the old name to preserve brand name recognition). When choosing a name, you\u2019ll need to make sure it\u2019s available in your state. You should also ensure it\u2019s available as a domain name for your website \u2013 you can do this at any of the major hosting platforms such as <\/span>GoDaddy.com<\/b>.<\/span><\/p>

As for business entity, you could register your venture as sole trader, which means you own the business in your name and have personal liability for its performance, or you could register as a limited or general partnership or limited liability company (LLC). These options will give you increased personal protection, but they require more paperwork and will cost more to establish.<\/span><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Step 2: Write a business plan<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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If you\u2019re seeking external investment or a commercial <\/span>business loan<\/span><\/a> to launch your business, you\u2019ll need a detailed business plan to support your pitch or application. Investors and lenders will want to know why you need their funds and what the money will do for your new venture. Business plans should do more than paint a rosy picture \u2013 explain the risks involved, what the downsides could be – and how you intend to overcome them.\u00a0<\/span><\/p>

Even if you don\u2019t need investment or a loan, a business plan can still be a very useful vital tool. Use it as your business manual, referring to the contents to guide your strategy and manage your financials.<\/span><\/p>

Find out more about creating your business plan <\/span>here.<\/span><\/a><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Step 3: Register your catering business<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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With your business name selected, you can register your venture with your state\u2019s business filing office. You\u2019ll also want to get an Employer Identification Number (EIN) from the IRS. You can do this online in just a few minutes. Note that your EIN acts as a business tax ID and it is usually needed when applying for commercial finance.\u00a0<\/span><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t

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Step 4: Get all licenses and clearances needed<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Because your business is handling food you\u2019ll almost certainly need to get licenses and permits and your state health department may also want to check your kitchen and food preparation location to ensure it\u2019s up to code. In most states it is illegal to run anything but a tiny food business from your home, so you\u2019ll need to find suitable premises for your operation. Ideally, you should choose a location that already has certification for food preparation as that will save you the time and cost of modifying the site to meet the required hygiene regulations and waste controls.\u00a0<\/span><\/p>

Liquor sales are governed by a host of laws, so if you plan on selling alcohol at events \u2013 either as part of a pre-paid package or by operating a cash bar \u2013 you\u2019ll need to get the necessary licenses and permits. Initially, you must register with the federal <\/span>Alcohol and Tobacco Tax and Trade Bureau<\/span><\/a> (TTP). They can also give you the information you need to get state and local operating licenses and permits for your business. Don\u2019t be tempted to start trading without the proper licensing as that can lead to large financial penalties or even prosecution.<\/span><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t

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Step 5: Determine your pricing<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Your target market and the type of service your business sells will help you to determine how much you charge. At the luxury end, there may be more room for mark-ups, but your costs will be higher. At the economy end, margins will be lean even if your costs are much lower. Be aware that in general, the US catering industry works to tight profit margins \u2013 typically <\/span>7% or 8%<\/span><\/a> – and it is common for customers to shop around for estimates before settling on a supplier.\u00a0<\/span><\/p>

Getting your pricing right is critical to succeed. You don\u2019t want to lose business because your pricing is too high. Nor do you want to provide your services at a loss.\u00a0 Do your homework. Set your pricing to be competitive without losing out.\u00a0<\/span><\/p>

How to set your pricing:<\/b><\/p>