Catering Management Contracting Course Notes

Course Learning Outcomes

  • Discuss elements embedded in a catering contract

  • Understand pertinent details in a contract agreement

  • Apply methods of computation in catering packages

Factors Affecting Pricing of Catering Events

  1. Food and Supplies - Cost considerations for ingredients and materials.

  2. Service Area Conditions - Factors such as venue conditions influence pricing.

  3. Facilities Required - Necessary equipment and tools for the event.

  4. Location - Distance from production area affects transportation costs.

  5. Labor Costs - Includes setup, service, and cleanup personnel requirements.

Important Considerations

  • Minimum Guest Guarantee: Specify guaranteed guests to determine costs; charges based on this number.

  • Food Cost Percentages: Off-premise functions should not exceed 35%. Adjust based on client relationships.

  • Labor Costs: Typically around 38% for personnel.

  • Distance Costs: Transportation and gasoline must be considered, including maintenance if the facility is owned.

  • Personal Service Charges: Expertise and skill should be compensated adequately.

  • Equipment Costs: Budget for use, damage, loss, and transporting of equipment.

  • Delivery: Considerations for delivery manpower, timing, and venue access.

  • Function Duration: Clearly communicate time limitations and fees for extensions.

Contract Essentials

  • Contracts serve as binding agreements outlining obligations for both caterer and client (payment for services and food).

  • A deposit of at least 50% upon signing is standard, balance completed after the function.

  • Include cancellation policies in the contract to mitigate issues, including fees for last-minute cancellations.

Pricing and Cost Computation

  • Total Cost Components:

    • Food and Supplies: 26%

    • Payroll: 38%

    • Purchased Services: 6.2%

    • Total Direct Cost: 70.2%

    • Operating Expenses: 15%

    • Net Income: 14.8%

Checklist for Catering Management

  1. Contact details of organizer

  2. Function type, date, and time

  3. Venue and number of guests

  4. Serving time and menu specifics

  5. Equipment and decoration rentals

  6. Guest services, transportation arrangements

Computation of Catering Packages

  1. Calculate Total Raw Food Cost (TFRC): Total ingredients cost for function.

  2. Raw Food Cost per Serving (RFC): TFRC divided by number of servings.

  3. Selling Price Calculation: Multiply RFC by desired percentage based on food cost.

  4. Include Buffer Margin: Add a 10% buffer for price fluctuations.

  5. Include Extra Charges: Service charges, tax, and excess reservations should be factored in.

Example Recipe Costing

  • Standardized recipe for accurate calculations.

  • Record and adjust ingredient prices regularly.

References & Resources

Recommended books and online materials for further reading and clarification.