How to Price a Catering Job

by Fraser Sherman; Updated September 26, 2017
Caterer putting last appetizer on tray

Good catering bids fall into the sweet spot in which the price is high enough that you make an adequate profit but low enough that you're competitive with other caterers. To price your bid you need to know your market, your customer's needs and whether she's cost-conscious or eager to splurge.

Get the Details

Just knowing you're catering for a party of 50 isn't enough to price the gig. A formal sit-down dinner, for instance, requires paying more servers than a help-yourself buffet. To make a realistic bid, you must know the details of the affair. It also helps to know the date. During holidays and other busy periods, demand for catering often rises, so you can increase the price above what you might charge during other times of the year. The location also matters. For example, if the event is 100 miles away rather than just down the street, you'll need to factor in the price of travel and gas.

Cost of Food

Covering the cost of your food is essential. The simplest way to do this is set a flat price for each food item, or per platter, so the customer can see exactly how much a sit-down dinner for 200 will cost. The quoted price should include the markup, which is the amount you charge above your food costs. A markup of 150 percent to 200 percent is common in food service. If the cost to you is, say, $10 a plate, you'd quote a price of $25 to $30. For large events, you can offer a reduced rate, say $1 less a plate for every extra 100 people.

Labor and More

Food is only one of many costs. You'll have to figure out how many servers, bartenders and waiters you might need and how many bussers and dishwashers to clean up afterwards. To figure your labor costs, take the total work hours, then multiply by the hourly wage. If you pay bartenders differently from waiters, say, calculate each group's total separately. Factor in prep time for setting up the bar, buffet, tables and so on, and for any cooking that has to be done ahead of time. You should also figure labor costs if the event runs over. Let the client know you will include these in the final price, such as X dollars for every hour it runs late.

Added Costs

If you're providing one-use-only supplies -- paper napkins, plastic wineglasses, disposable utensils -- include that in your price quote to the customer. If you don't know the costs, call stores and restaurant supply firms in your area and find out what you'll have to pay. If you rent equipment or trucks for the event, you need to know the rental costs before you bid. If you drive anywhere, factor in the cost of gas. Depending on the venue you may also need to buy a one-day permit for serving alcohol. Don't omit any costs when putting together your quote.

Quoting a Price

When you quote the customer a price, provide details. Your customer should know the cost per plate, and total food cost, plus any non-food costs -- labor, supplies -- you're charging her for. Setting the right markup on your quote is tricky because there's no hard and fast rule for how much it should be. Food Service Warehouse says you should shoot for a 20 percent to 30 percent profit margin after subtracting for overhead. Before quoting someone a price, research what other caterers in your area charge. Talk to your customer about whether the event is tightly budgeted or the sky's the limit. Also consider your own image. For instance, if your selling point is that you're a budget caterer, your customers will expect lower prices than if you advertise an upscale, fine-dining experience.

Resources

About the Author

A graduate of Oberlin College, Fraser Sherman began writing in 1981. Since then he's researched and written newspaper and magazine stories on city government, court cases, business, real estate and finance, the uses of new technologies and film history. Sherman has worked for more than a decade as a newspaper reporter, and his magazine articles have been published in "Newsweek," "Air & Space," "Backpacker" and "Boys' Life." Sherman is also the author of three film reference books, with a fourth currently under way.

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