Present and Expected Future Growth of Catering Services Business

Catering services business is a rewarding option with huge potential of growth. Considering the importance of social celebrations and events, corporate cultures and social lifestyle, you can consider the catering industry to expend its status and profitable nature further.

Catering service providers are finding recognition at small as well as big levels. The catering industry is not only favorable for home based businesses; it is helping the social caterers to make big profits. Though, it is obvious that only those service providers in the industry succeed who are able to withstand this demanding business option.

As far as the current trends of catering services industry are concerned, it has attained status among top industries with an ever-increasing demand of various services offered by it. Social caterers in the United States, for example, make sales of over 6.5 billion dollars every year. This figure should significantly increase if the sales generated by home-based and unknown caterers are added to it.

The restaurant industry came up with good figures even when other industries were struggling during the period of recession. The consumers in the United States spend about 50 percent of their total food budget in the restaurants. This clearly indicates how the establishments like restaurants, cafes and other types of eateries are growing their profits year after year.

The catering services industry in the developing countries too is enjoying the favorable period of growth. The countries like India has its people adopting to the new lifestyles which include better food preparations for different types of social and cultural functions and increased habit of people to eat in restaurants regularly.

The main promising factors that ensure that the catering industry is going to maintain its consistent growth for the years to come include:

  • Household with higher income are helping the catering industry to flourish. In the developing countries as well, the household income is increasing at a fast pace. So, more and more people are attracted towards the catering industry and the services offered by it.
  • Corporate culture that holds a number of meetings, conferences, business lunch and dinner parties are becoming greatly dependent upon the catering industry services. The trend might not be that new for the developed countries, but the countries that have recently discovered the corporate culture are helping in the industry to attain popularity.
  • Birthday parties, wedding receptions and other types of family events are more and more relying upon the catering service providers. This is mainly because of the increase in number of working mothers that give them less time to do preparations in the kitchen.
  • Finally, people are getting more attracted towards the fashion of eating out with families and friends. This type of lifestyle is again new for the developing countries.

As you can have an idea from the discussion above, the catering services industry is one of the best options for those planning to have their own business. Start with a good business plan and keep an eye on the existing competition to have a successful catering business.

Business Fundamentals for Entrepreneurs

Having a great idea and the motivation to strike-out on your own is a good first step in pursing the feasibility of a business. However, it takes more than motivation and a great idea to get things started. This article will reveal some of the simplest considerations that most would-be business-owners overlook.

The very first thing that should not fall under consideration is venturing out on your own without the proper tools beyond the scope of a great idea. According to statistics provided by the Small Business Administration, over 90% of small businesses fail due to a lack of planning. How many times have you heard or witnessed individuals that sat up over a weekend and wrote a stellar business plan then headed out on Monday morning to seek funding or investors? Impatience is the second thing that needs management. So often “I am tired of working for someone else” is the premise for people to start a business. This frame of mind will almost ensure failure because this approach to business involves looking backwards at getting out of a bad situation.

There is a prevailing philosophy that has to evolve, “Not all people are cut-out to become business-owners”. This is a harsh reality to face in a country such as the United States that prides itself on autonomy and ownership. Starting a business requires a commitment that may or may not pay dividends quickly. The key threat to small businesses is the initial funding or start-up cost and therefore many under-capitalized ventures hit the markets and get that rude awakening.

Before spending your first dollar a best practice is to do your “free research” on the Internet and in public libraries. Read recently published academic studies on the industry in which you plan to pursue. It takes more than just knowing a certain aspect of the business being that your competition may be more well-versed about the industry as a whole. You may want to ask questions such as “What are the regulatory requirements to do business within that particular industry?” You may want to research about “systemic exposure” or how the rest of the economy could or would impact that industry during troubled financial times. It is also a good practice to review some of the strategies of other potential competitors during The Great Recession of 2008. How did the industry leaders survive jn respect to operational changes and sacrifices. It is understandable that this may take several days or even weeks to accomplish, but by applying the best practices initially you will have a clear understanding of what to expect during certain economic times.

It is essential to understand who are the industry leaders within your business channel and what makes them unique. There should be an emphasis on this because your branding and marketing could benefit from such a consideration. A distinguishing characteristic may be customer service, quality assurance, product branding, or even presentation. These may sound trivial, but think about if you were a retailer for mens apparel and you specifically wanted to appeal to young urban males under the age of thirty. Labels equals status in many of these communities so a nice logo on the item that is visible may assist in the popularity and purchase of your garments. Even though this may have more to do with marketing and brand positioning, this is a must have against the competition.

However, before we get to marketing and branding there are other things needing consideration such as your mind-set, ego, time-line, available start-up capital, and feasibility. After you have trolled through the data and information from your research, the next step is the feasibility study. It is suggested that you do this prior to writing a business plan. In this way you can quickly determine whether or not you can enter the particular market or not and if so, at what level. A common mistake for new business people is to envision competing with the industry leaders. This is an ideal way to go broke quickly. In stead, set more realistic goals for yourself and get the notion out of your head that the Internet is going to make your business global. Facebook and the other social networks became popular because they were free to the end-user first and while trying to figure out a way to capitalize or convert those users into revenue. This would be a bad business-model to follow. Think about your region and the local competition first to see how much it would cost for you company to operate for the first 3 to 5 years without constant revenue.

Again this will require more local research this time on your specific region and take not of the deviations between your first broader macro research and the more localized micro research. The deviation between those two areas may actually become the niche that needs filling. In this way you can actually have a specialized niche within the region and a hybrid on a larger scale. Now, you may ask yourself “Why?” Simply put, the goal is to avoid what others are already doing in the sense that giving a “Thankyou” to a customer in a better way that the competitor is not enough. Another temptation to avoid is the centric mind-set that the business and industry has to behave according to your own belief or philosophy. This strategy rarely works out in a positive way. You have seen these business owners that rarely listens to their customers and as a result they have a revolving door of both customers and employees and the business stagnates and does not grow.

Growth must have a major role in the definition of your business because that is the incentive to attract customers, employees, and even investors. As a potential business-owner you will have to cleanse your mind of working for a company and view your company as your tangible boss. This may sound counter intuitive, but the cascade is like this, the economy drives the consumer or businesses that drive behavior which drives your company which eventually drives you to make the right decisions to meet the demand.

So far you have done your research, and you know how much it will cost you to compete in your local market. The next thing is to consider your liabilities as it relates to the company. You may use this also to determine what form of business ownership will work for you. It is a good business practice to incorporate whenever possible and in some states there are differences in levels according to projected revenues. Incorporating also gives you more protection than a DBA or partnerships. At this point you will learn another strategy that many successful business-owners do, delegate tasks that require professional expertise to professionals with their fields. A good business attorney, accountant, and business consultant are essential for start-ups. This is a gap that many would-be business people fall through the cracks. Another benefits is that these professionals may also assist in giving information that may be crucial in developing a comprehensive business proposal. They can help with the work you have done to reflect the requirements needed.

In review, you have your research, feasibility study, chosen your business ownership type, adjusted your expectations, hired professionals that know the laws and regulations better than yourself and you are ready to get started on the business proposal. Not so fast, “Where are your customers?” You guessed it, marketing research needs to take place for the particular individuals or companies that will use your products and or services within your area or online. One question to ask yourself, “How much will it cost me to contact a potential customer before a sale is completed?” And secondly, you need to discover the best way to contact these people or businesses. The prevailing statistics are that radio advertising a person is a passive-listener and only hears about every fourth word, direct mail only about 9% responds. Signs and other ad-hoc methods vary and television may be expensive depending on stations and providers. This means that a considerable budget may need to exist in order to solicit business. Again, this is another area where many would-be business people fall off the wagon and failure is waiting to catch them.

There is not an exact science to forecasting revenues so the goal is to have a very plausible theory and approach to this process. Avoid the temptation of raising expectations too high as some did in the dot com era for instance and went broke. The increases in expected revenue should be modest and function on the Standard Rule of 10, meaning that expenses should never go over 10% of revenue. Now, there are some businesses with a lower profit margin at 50%, but that is akin to paying US$10 for every US$20 received in revenue. As you can see pricing strategies for your products and or services are important and trying to make profits off of volume only works for those entities with high capacity transactions. This is the reason why 99 Cent Stores do so well low inventory cost and high turn-over of products. As a foot-note the difficulty with starting a business with very low prices is that it usually attracts the cost-conscious customer who is rarely brand-loyal and will use a comparable competitor. You see this behavior in customer that may shop at Wal-Mart, but purchase other specific items at the 99 Cent Stores. The danger in depending on these cost-conscious customers is that when prices rise they usually leave. Therefore, your pricing model needs to be established as feasible to sustain the business based on the value-added customer that you can possibly up-sell items or services. This is essential to your company’s growth and expansion.

Customer Service – Balance Between Speed And Courtesy

Customer Service needs to change

A few years ago when a person went to a coffee shop, or a store, they were greeted with a smile, asked about their day, and then were told to have a nice day after they conducted their transactions. I work as a Paramedic in the city where I live and frequently I have to get things on the run. This means that I am running into coffee shops, and restaurants and convenience stores, and something dawned on me. I realized that almost never does anyone ask how I am, and beyond a what do you need? I get asked no questions. There is not even eye contact, and when they hand me my change, or receipt there is no have a nice day, and not even a smile.

A few years ago when I went into certain places that I was at often, I was greeted by name. I have spoken with many people and this is not just a me problem. It is a customer service industry problem that needs a change. I completely understand that businesses want service to be fast, because it is something that people demanded for years, but businesses have taken it too far.

It is time for a change

I am not upset with businesses, I believe we have pushed this demand to where it is today and it is up to us to bring the customer service industry back to where it should be. This starts with us. What we need to do as consumers is almost force the conversation. When you arrive at your coffee shop today or tomorrow ask the counter people how they are, and ask how their day is. Let us bring manners back to the customer service industry. Pay them with a smile and when they hand you your items or receipt tell them to have a nice day. By doing this we cause a change in the balance. This slows the transaction down just enough that less mistakes will be made, AND, it shows people behind that counter that it is OK to be interested in a person’s day.

I don’t know if people realize, but the loss of personal communication, and real contact is an epidemic in today’s society. This can be transferred into your home business work as well. The people you want to bring into your home based businesses will be far more responsive to a person that has the capability to communicate effectively. Network Marketing is all about the people, and this is something that you need to remember. When you remember that business is about people, you will start to see far greater success in your home based business.

Will Computers Ever Meet the Expectations Of Small Businesses?

Old School Vision of Computers

As a child of the 60’s, I grew up watching Hollywood’s vision
of the computer of the future. I use to watch in amazement as
TV character would feed a question into a computer and an
obscure answer would immediately be spit out. I remember
playing “computer” with my grade school friends in the
neighborhood. I put a cardboard box over me with a light bulb
jammed in the middle of it with a slot in the front. I would
have my friends write a question on a piece of paper and slip
it threw the slot, and as I made ‘bleeping’ and ‘zooping’
noises, I replied to their questions about the universe, the
best a grade school child could.

I eventually outgrew the Hollywood vision of computers, or at
the very least, Hollywood’s vision for the computers of the
future became a little more realistic. Although, the
reoccurring notion that computers will solve all our problems
won’t go away. As recently as five or six years ago, I
remember seeing a commercial promoting the Internet and how it
will magically solve all our woes, minus all the ‘bleeping’
and ‘zooping’ I remember from TV as a child.

Unfortunately, the promises of computers and the Internet have lagged behind our expectations of them, especially the expectations of small businesses. While large multinational corporations have been able to afford IT departments that could create specific applications to suite their needs, many small businesses were left out in the cold during the “computer revolution”. If a small business had a specific need or requirement with respects to automating their business process, their only choice was to hire a computer consultant, who could take weeks, and possible months, to write their program, and charge a cost prohibitive amount for the service.

Unfortunately, the reality is that most small businesses have been left with the same applications and programs they’ve been using for the last 10 years. Computers for the small business resemble a typewriter of the past more than Hollywood’s image of the computer of the future. At best, some small companies might have an individual on their staff that could create elaborate Spreadsheets, but more times than not, a computer was seen begrudgingly as items of unfulfilled promises.

The Second Coming of Computers

Over the last four or five years, there has been another “computer revolution”, and unlike the “computer revolution” of the mid to late 90’s, that mostly affected consumers and large businesses, this one is aimed at small businesses.

Threw the mid to late 90’s, innovators and visionary’s toted the Internet as the end-all-beat-all to everyone’s woes and problems with promises of a “new economy” and riches for all. Everyone was excited about the promise of computers, and everyone was eager to hop on the Internet dot com bandwagon. I’m sure most people know of someone that attempted to make money off the Internet, from that cousin that attempted to start a web site, to that neighbor that changed careers and went threw a technical training to learn programming or systems administration.

When the tech bust of 2000 happened, thousands of individuals that had hoped to reach their goals threw computers and the Internet, found themselves unemployed and ferociously competing for jobs. Within a matter of months, job postings that were only receiving two or three resumes were suddenly being flooded with resumes. Over the course of months it went from being an employee’s market to being an employers market.

The tragic events of 9/11 were what put the computer industry into a tailspin and ironically opened up the possibility of the second “computer revolution”. As corporations froze their budgets and killed projects, thousand more individuals found themselves unemployed. For roughly one and a half years, the computer industry seemed to die on the vine, and as individuals began to become despondent, they began to change careers again hoping to make an income that could support their families and life styles.

Fortunately, a certain percentage of individuals refused to give up on a career in the IT industry, and many programmers began to search for alternatives to being employed by large corporate IT departments. Some were bitten by the entrepreneurial bug and began writing programs for industries they were familiar with from past careers. As new entrepreneurs began with limited budgets and resources, many of these programs were targeted towards smaller businesses.

Is There a Limit to the Industries Affected?

I myself use to consult with Fortune 500 companies, have moved my practice to small and mid-sized corporations. Since doing so I’ve become amazed at the evolution I’ve seen in some of the most surprising industries. The industry I’m most surprised with is the pest control industry. I have an acquaintance that has a pest control business. Basically he catches rats and mice for the food service industries.

We were talking one day about the subject of a second “computer revolution”, when he began to share his own experience with it. Apparently, he had purchased an application that utilizes a bar code reader that records the status of his mice and rat traps. As he goes from customer to customer, he scans the traps and records the status of the trap, if it was empty, had a catch or even if the trap was gone. After he is done with his route for the day, he goes back to his office and downloads the data into his application and is able to compile trends at his customer’s sites.

With the use of this database, he no longer has to rely on his memory, guessing, or digging threw paper work to figure out what is going on at his customer’s sites. He can simply use his application and have his database tell him if his customer’s site is clean, infested or if the infestation has moved. Based on these reports, he is able to sell his customers more accurate services and products based on their individual needs. He claims his business has grown approximately 12% over the last two years threw the use of this product.

After I moved my practice to small and mid-sized business, I stumbled across a small application that I have since recommended to many of my customers in the Service Industry. I had a customer that is in the Chimney Sweep industry, and for their industry, the business is considered quite large with 9 trucks and approximately 30 employees. They had been experiencing many problems with issues like inventory, dispatching/scheduling, and invoicing they wished to correct threw the use of a customized application.

In an attempt to make the business more productive and profitable, they had contacted me with the desire my company write a program that would fulfill all their needs. Upon assessing their requirements I quickly analyzed that that it would be a more cost effective solution to identify an existing product that could fulfill all their needs. After a few days of searching I discovered an Enterprise Resource Planner (ERP) for small Service-oriented industries.

The application was written by a group of three programmers who found their jobs outsourced to India in 2002. One of them had experience in the HVAC industry prior to changing his career in the mid 90’s, after discovering himself unemployed but still with hopes of staying in the IT industry, he wrote the application with two of his former co-workers.

After discovering the software vendor, I worked with them to identify their products full potential and eventually established it was flexible enough to be a good match for my customer’s requirements. With a good deal of hindsight, the programmers developed their product on Open Source technology, which allows parts of programs to be distributed for free, allowing it to be created for a fraction of the cost their counter parts of the 90’s.

My customer is now able to manage invoicing, purchase orders, inventory, scheduling/dispatch, and Marketing with two – three office employees verses the four – five they need a few years ago. The application, which the multi-user version costs approximately $2,500 and the single-user version costs approximately $650, is very cost effective.

For a smaller business to have an application of this versatility and functionality would have been unfathomable prior to 2001. I have since installed this application into several customers, all of which have become dependent upon it for the smooth operation of their companies.

The Promise has Finally Arrived

For smaller companies wishing to experience the promises of computers the time is finally here. More and more small computer vendors are springing up, producing complex and cost effective applications and products for most conceivable industries.

For small businesses to reap the benefits of present technology, they need to:

1. Know exactly what business process you wish to affect with the introduction of software.

2. Do your homework on the Internet, there are many small software vendors out there, if you do a through search, a vendor can be found with the solutions you need.

3. If you wish to use a consultant to identify a solution, don’t assume they are familiar with your industries needs and requirements. Ask what experience and solutions they’ve had with your specific industry.

4. Get references, an established firm should be able to produce previous customers that can vouch for their quality of work.

5. Get a break down of the costs involved with the installation of the product. Get it in writing if there is any training or tech support.

6. A consulting firm should be attentive to you and your needs. There are good consulting firms out there and there are bad consulting firms out there, the difference should be evident in the amount of effort and energy they spend to identify the correct solution for you and your company.

While we are definitely in the beginning of the second computer revolution, unfortunately, if you are expecting to magically obtain the benefits of it, chances are you’ll be let down. Expect to do some work when trying to find the right solution for you and your business. The more energy you spend in trying to find the right solution will directly equate out to the amount of increased productivity and profitability your company will experience after the solution is installed.

While computer solutions may never reach the point where an individual will simply input a question or problem and suddenly receive an answer, small businesses are much further ahead of where they were five years ago.