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Catering Business Plan Template
Catering companies are popping up at a tremendous rate, but many fail in the first year. Because you are serving food, a successful catering business must have a deep understanding of health codes and permitting requirements on a local, state, and federal level. In addition, many catering companies try to grow too quickly, and expand in ways that are not necessarily sustainable long-term. To avoid falling into these traps, a written business plan is absolutely critical. Also, if you plan to seek funding, investors and lenders will use your business plan to decide whether your catering company is a good investment.
The Purpose of Your Business Plan
A business plan serves two purposes. It provides a snapshot of your catering company at this moment in time, and it lays out a guided plan for growth over the next three to five years. The business plan defines your goals, identifies potential roadblocks, and details your strategies for reaching your goals. It is a living document that will evolve as your catering company grows and changes.
Although it is normally the last section written, the executive summary is the introduction to your business plan. The first page tells investors and lenders whether it is worth reading more, so make that page count. Give a simple, concise description of your catering business, a summary of your market analysis that proves your catering company meets an identified need, and a short explanation of why your business is uniquely suited to fulfill that need.
The company analysis is a detailed look at your catering business as it exists today. Talk about its founding, legal structure, and current stage of business. Describe past milestones, such as partnering with a key vendor or meeting a funding goal. Elaborate on the unique qualifications you mentioned in the executive summary, from hiring a locally known chef to securing exclusive rights to a competition-winning recipe.
In the industry analysis, focus on your relative market, or the particular catering niche into which your company fits. Do you specialize in buffet meals for private events? Do you serve plated meals? Do you focus on a specific type of cuisine? Decide how your catering company fits into the overall industry, and then research trends and projections that affect your part of the industry. Describe your plan for meeting any challenges that your research unearths.
The customer analysis requires you to drill down and determine exactly who your target customers are. Do you want to primarily cater weddings and high-end private events? Do you want to target corporations? Are your customers middle income families or the wealthy elite? How do they make their buying decisions? Is there a specific level or style of service they want, or is the food the most important? Identify your customer demographics, and describe how your catering company will meet their specific needs.
Your direct competitors are other caterers who fulfill the same need for the same market. Your indirect competitors fulfill the same need for a different market, or a different need for the same market. Name your direct competitors and talk about what makes your catering company stand apart. Group your indirect competitors into a single category and talk about them as a whole.
The four P's of marketing are Product, Place, Price, and Promotion. Product includes every item you plan to sell, as well as the services your catering team provides. Place is your physical business location and online presence. Price is the amount you will charge for each product or service, along with your rationale for setting those prices. Promotion is how you will convince people to try your services. Finally, Customer retention refers to how you will get customers to use you again.
The operations plan explains how you will meet the goals that you previously outlined. Everyday short-term processes refer to the step by step tasks of booking customers, cooking and serving food, setup and tear down, and billing. Long-term processes refer to your business goals, such as opening a new location or adding expanded services.
In the management team section, highlight your key team members' backgrounds, focusing on those elements that prove they have the capacity to build your company. A strong advisory board can compensate for weaknesses, provided you explain exactly how your board members will directly contribute to the company's growth.
As a service-oriented business that also requires a great deal of physical equipment, it can be tough for a catering company to project income and expenditures. Yet the financial plan is the section of the business plan that lenders and investors scrutinize most closely. You need to break down all of your revenue streams by relative importance and timeline for implementation. You must disclose projected sources of outside funding. In addition, you must summarize your past and future Income Statements, Cash Flow Statements, and Balance Sheets based on key assumptions that are verifiable and reasonable. In addition, a solid exit strategy demonstrates that you understand the market and the best timing for cashing in.
The appendix is the place to attach your full financial projections along with any other documentation that can help prove your claims, such as letters of partnership with major vendors, patent information for any proprietary technology, or even award certificates for prize-winning recipes.
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