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adolpho
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Joined: 03 Aug 2005
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Location: Austin, TX
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 Posted: Apr 12 2007 Post subject: |
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| Slamdunkpro wrote: | | adolpho wrote: | | As far as pricing yourself cheap and people expecting it, that's totally what you make of it. If you lose them as a client next time around, then they are just being cheap. But if you did an awesome job and the food was great, they'd understand and be willing to pay. Most businesses (outside of catering) do promotional things like this. They make a small profit the first time, but get bigger returns when used again. |
I disagree here. I've been in the service industry for a long time (including food service) and I've learned that discounts only lead to more discounts. Soon everyone is shopping you on price alone and you become the "lowball leader".
Say you take pity as someone suggested and do this gig for $600. You're a hit and the wedding party refers you to 25 people. They all call and want the "$600 package that Mrs. XXX got". Now what do you do? Almost any response is going to be off putting to these potential clients and generate considerable bad will. |
This is also for bigdad too.
You can disagree, but what I was trying to state is that some people are just cheap and so if you lose them or their friends as clients the next time around, then oh well. But for some of those that you struck a deal with, if you cooked good enough and provided a great service, they will be willing to pay more the next time and promote you to their friends. Deny it all you want, but it does work like that for both sides: cheapscapes are still cheapscapes and appreciative clients come back and pay more. Sorry for not making it clearer. I sometimes write and then realize I left a lot off.
And another apology to you Marv, from your earlier posts I couldn't tell that you offered her advice. I just thought you were being harsh. Thanks for clearing that up.
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Last edited by adolpho on Apr 12 2007; edited 1 time in total |
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adolpho
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Joined: 03 Aug 2005
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Location: Austin, TX
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| Posted: Apr 12 2007 Post subject: |
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BTW.... I may be a rookie in catering, but I've been in the music industry for almost 20 years. I'm on a record label, have tons of gigs in Austin, and our group won Best Mariachi in Los Premios Latinos.
Talk about service expeience, I think I have some. Heck, you can call me the Marv's BBQ of Mariachi in Austin.
Enjoy my website:
http://mariachirelampago.com/
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G's BBQ
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Joined: 13 Sep 2006
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Location: NV
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| Posted: Apr 12 2007 Post subject: |
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[quote="OddThomas"] | GordonsBackyardBBQ wrote: | | OddThomas wrote: |
Its a reality. I certainly don't see where the 70 to 80 % is in a 2.50 meal.  |
You're absolutely correct I meant to state 20-30% profit, as BBQMan also pointed out.
And let's just put it this way then; I could feed 200 people just chicken on a $500 budget and put about $200 in my pocket when it was all over. I also think I could probably bump her up to $600 unless she was flat broke and increase my margin a bit.
At the end of the day though, for the big dogs, it probably just isn't worth it. |
20% -30% wouldnt even cover costs. What 1 piece of chicken with nothing else. |
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G's BBQ
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| Posted: Apr 12 2007 Post subject: |
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| adolpho wrote: | | Slamdunkpro wrote: | | adolpho wrote: | | As far as pricing yourself cheap and people expecting it, that's totally what you make of it. If you lose them as a client next time around, then they are just being cheap. But if you did an awesome job and the food was great, they'd understand and be willing to pay. Most businesses (outside of catering) do promotional things like this. They make a small profit the first time, but get bigger returns when used again. |
I disagree here. I've been in the service industry for a long time (including food service) and I've learned that discounts only lead to more discounts. Soon everyone is shopping you on price alone and you become the "lowball leader".
Say you take pity as someone suggested and do this gig for $600. You're a hit and the wedding party refers you to 25 people. They all call and want the "$600 package that Mrs. XXX got". Now what do you do? Almost any response is going to be off putting to these potential clients and generate considerable bad will. |
This is also for bigdad too.
You can disagree, but what I was trying to state is that some people are just cheap and so if you lose them or their friends as clients the next time around, then oh well. But for some of those that you struck a deal with, if you cooked good enough and provided a great service, they will be willing to pay more the next time and promote you to their friends. Deny it all you want, but it does work like that for both sides: cheapscapes are still cheapscapes and appreciative clients come back and pay more. Sorry for not making it clearer. I sometimes write and then realize I left a lot off.
And another apology to you Marv, from your earlier posts I couldn't tell that you offered her advice. I just thought you were being harsh. Thanks for clearing that up. |
Well they can go to another caterer (actually I highly doubt they would find one unless they dont have the proper licenses, insurance, permits etc.)
What some here who are new to the game are failing to realise is all the other costs associated. I'm not trying to be harsh but some really havent thought this through.
And as Marv & BBQman have said, no-one is being rude to customers. There are many ways to let those people know whats involved. Education is formost. Customer service is a big part of this business.
And even if someone is completely ignorant of the catering world, I'm sorry, but to expect a meal for $2.50 is well...ya you guessed it |
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marvsbbq
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Joined: 15 May 2005
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| Posted: Apr 12 2007 Post subject: |
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I will be the first to admit that catering offers a HUGE profit margin IF you only take into account the food costs. I think OddThomas was only working with that figure when he said he COULD cook for 200 guests for $500 and still make $200. Let's see now, there is material costs, equipment costs, fuel costs, (bbq & truck), licenses, permits, insurances (auto & liability), labor (mine and my help, need 3-4), utilities...That is just what I can think of off top of my head....I sure there are more if I really thought about it...
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adolpho
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Location: Austin, TX
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| Posted: Apr 12 2007 Post subject: |
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| GordonsBackyardBBQ wrote: | ...
And as Marv & BBQman have said, no-one is being rude to customers. There are many ways to let those people know whats involved. Education is formost. Customer service is a big part of this business.
And even if someone is completely ignorant of the catering world, I'm sorry, but to expect a meal for $2.50 is well...ya you guessed it |
Yes I agree on this. That's why educating them will keep them from being ignorant the next time around.
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G's BBQ
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Joined: 13 Sep 2006
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Location: NV
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| Posted: Apr 12 2007 Post subject: |
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| adolpho wrote: | | GordonsBackyardBBQ wrote: | ...
And as Marv & BBQman have said, no-one is being rude to customers. There are many ways to let those people know whats involved. Education is formost. Customer service is a big part of this business.
And even if someone is completely ignorant of the catering world, I'm sorry, but to expect a meal for $2.50 is well...ya you guessed it |
Yes I agree on this. That's why educating them will keep them from being ignorant the next time around. |
Absolutely  |
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soonerjimmie
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Joined: 31 Mar 2007
Posts: 134
Location: Quincy IL
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| Posted: Apr 12 2007 Post subject: |
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As soon as you try to help someone out, you will have 10 more the next week. Keep all your extras and freeze them then turn around sell them to her for the $500 everyone is happy
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Thanks,
Jimmie
JJ's (almost famous) BBQ
www.jjskitchen.com |
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G's BBQ
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| Posted: Apr 12 2007 Post subject: |
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| soonerjimmie wrote: | | As soon as you try to help someone out, you will have 10 more the next week. Keep all your extras and freeze them then turn around sell them to her for the $500 everyone is happy |
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Jeff T
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Location: Norfolk, Nebraska
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| Posted: Apr 12 2007 Post subject: |
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| allsmokenofire wrote: | | OddThomas wrote: | | At the end of the day though, for the big dogs, it probably just isn't worth it. |
...and that is why there are little dogs too. Then the little dogs grow and become big dogs...."it's the circle of life Simba". 
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Indeed.... |
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soonerjimmie
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Joined: 31 Mar 2007
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Location: Quincy IL
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| Posted: Apr 12 2007 Post subject: |
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| soonerjimmie wrote: | | As soon as you try to help someone out, you will have 10 more the next week. Keep all your extras and freeze them then turn around sell them to her for the $500 everyone is happy |
I was joking
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Thanks,
Jimmie
JJ's (almost famous) BBQ
www.jjskitchen.com |
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OddThomas
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Joined: 07 Mar 2007
Posts: 2010
Location: North Carolina
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| Posted: Apr 12 2007 Post subject: |
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ROF! This place rocks!  |
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BBQMAN
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Joined: 13 Jun 2005
Posts: 15475
Location: Florida
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| Posted: Apr 12 2007 Post subject: |
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We know!
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BBQMAN
"I Turned A Hobby Into A Business".
Providing "IMHO" Since 2005. |
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OddThomas
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Joined: 07 Mar 2007
Posts: 2010
Location: North Carolina
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| Posted: Apr 12 2007 Post subject: |
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| GordonsBackyardBBQ wrote: | | 20% -30% wouldnt even cover costs. What 1 piece of chicken with nothing else. |
Well what do you expect for $500? |
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G's BBQ
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| Posted: Apr 12 2007 Post subject: |
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| OddThomas wrote: | | GordonsBackyardBBQ wrote: | | 20% -30% wouldnt even cover costs. What 1 piece of chicken with nothing else. |
Well what do you expect for $500? |
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BBQMAN
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Joined: 13 Jun 2005
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Location: Florida
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| Posted: Apr 12 2007 Post subject: |
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| OddThomas wrote: | | GordonsBackyardBBQ wrote: | | 20% -30% wouldnt even cover costs. What 1 piece of chicken with nothing else. |
Well what do you expect for $500? |
Of course this is where we started, and we are right back there now!
Here's the bottom line- you get nothing but a hard time for $2.50 a person (put in a nice way, of course! )
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BBQMAN
"I Turned A Hobby Into A Business".
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OddThomas
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Joined: 07 Mar 2007
Posts: 2010
Location: North Carolina
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| Posted: Apr 12 2007 Post subject: |
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| marvsbbq wrote: | | I think OddThomas was only working with that figure when he said he COULD cook for 200 guests for $500 and still make $200. Let's see now, there is... |
Howdy,
That's exactly what I meant when I said "I" could do it Marv. I don't have all the expenses you do because, I'm still a small fry in a big basket. Heck I don't even think you'd consider me a fry at all. If I do anything I usually only have to consider raw materials and my time. For you, BBQMAN, Gordon, and others that have big operations and real business overhead, this obviously isn't an option.
I'm sure I'd rather learn this now than later, so thanks for all the info from everyone. |
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BBQMAN
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Joined: 13 Jun 2005
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Location: Florida
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| Posted: Apr 12 2007 Post subject: |
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Trust me OddThomas, you could do it for $500.00, but why would you want too?
You'll thank us later!
Plus that, I don't know what your time is worth, but I bet it is more than minimum wage! I do some trades work on the side during my "off season". I get $20.00 an hour, and since there are only 24 hours in a day, and 365 days in a year I will be busy for a long, long, long time!
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BBQMAN
"I Turned A Hobby Into A Business".
Providing "IMHO" Since 2005. |
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Harry Nutczak
BBQ All Star
Joined: 01 Mar 2007
Posts: 8558
Location: The Northwoods
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| Posted: Apr 13 2007 Post subject: |
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oddthomas,,
yes you could show a profit, but lets look at it this way.
you would probably end up feeding them chicken leg quarters, that's it! nothing more for the estimated 150-175 people. Ok, so when the guest's start asking the bride why only leg quarters are served? is she going to say, well I am sorry, I will never use this caterer again, or will she be truthful and say that they are just plain broke and could not afford more?
they will blame the caterer every time!
so, you have just put yourself in a very bad position with up to 200 potential customers.
any way you look at this gig it is just bad news. you can try to help out but your gonna get hosed from all directions! either lack of food, not high-end food, or a bad guest estimation and double the amount will show!
Now if you were a personal friend of the wedding party it could be different. You could do the gig as a gift and use all the money for food. (still be some low-end stuff though) and then you might come out ahead in a charity related deal.
If I had accepted this party, or was forced into it, I would not be onsite, it would be cooked at my location (forget about legals right now) and the party can pick up the food in disposable foil pans. No cards would be given out.
you might be able to then make a small amount of money and not ruin a reputation, or delay a good reputation from happening that way.
I have ran this scenario through my mind for a full day now and do not see any way that a caterer could not have a bad reputation started if they accepted this party at this cost.
Marv, thank you for starting this thread, I am sure it has gone a total different direction then what you expected. but we are all figuring ways to handle a similar situation should it ever arise.
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OddThomas
BBQ Super Pro
Joined: 07 Mar 2007
Posts: 2010
Location: North Carolina
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| Posted: Apr 13 2007 Post subject: |
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Howdy
Those are all good points Harry; thanks. I have run into similar situations in the creative direction business as well. Although I don't usually have material expenses (outside of printing costs) there are a lot of "labor" costs involved. Sometimes I catch myself trying to "help someone out" and it almost always comes back to bite me on the rump. I suspect the catering biz is the same.
Thanks again |
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