Industry sector:

Outside caterer: Market research

When you plan your catering business it's very important to give some thought to who your customers will be and how well they are already served. Doing some market research will help you to establish the facts.

Your market

It is likely that your customers will be members of the public and local businesses and organisations.

Members of the public might include those booking:

  • weddings, anniversaries, christenings and so on
  • funerals and wakes
  • other religious events and celebrations - for example Bar Mitzvahs
  • parties

Your corporate customers might include:

  • local businesses
  • local clubs and associations

These might book you for boardroom meetings, team-building events, Christmas parties, publicity launches and so on.

Think about the people and businesses in your local area and consider who might use your services. This will help you to focus your marketing efforts.

Estimating demand

Try to establish whether there is room in your area for your outside catering business. A well run business should have a good chance of establishing itself. The outside catering sector consists mainly of small independent catering businesses which will be your main competitors. Other competition may come from restaurants, cafés and sandwich bars that offer catering as a side venture. This type of business may be able to undercut you on price as they are able to use their existing premises, staff and facilities.

Check out the competition in your area to identify how many other outlets are already offering outside catering. There are a number of ways to do this, such as:

  • looking in the Yellow Pages and other similar directories
  • searching online

Once you have identified the level of competition, you may find it beneficial to establish what the quality of your competition is like. Assessing existing businesses will give you an idea of:

  • what their menus are like and the prices they charge
  • which type of events they cater for
  • whether they do private and corporate functions
  • how helpful their staff are
  • whether the premises are modern and smart
  • whether they have any outstanding features that you feel would be difficult to compete against

Why will customers choose you

You need to make sure that enough customers will choose your business. Your market research might indicate that there is a gap in the market that you can fill. For example, you may have noticed that none of the businesses in your area offer summer BBQ party services, hog roasts or gourmet dinner party services. Alternatively, you or one of your employees may be a noted or well qualified chef, you may decide to offer a complete event organising service rather than just catering or you may be the cheapest or most exclusive.

You may decide to target the corporate sector by sending out menus and prices to local businesses to try to gauge the level of interest. Pitching your prices lower than your competitors may generate interest and enable you to start to build up a corporate client list. Corporate functions may be boardroom meetings, Christmas parties, publicity events and so on and will often require buffet style food rather than a sit down meal. You may decide to offer a different range of menus for corporate clients.

Give people what they want

It is likely that some of your dishes and menus will be more popular with customers than others, although this will generally become apparent over a period of time. It's a good idea to try to be flexible and cater for specific requests from customers, even if they are not on your menu. Keep up to date with changing trends by reading trade journals, attending trade shows or looking round your local supermarket. Supermarkets spend a lot on researching what consumers like, so if, for example, a range of Thai food suddenly appears on their shelves you can assume that they are not just guessing that people will buy it.

Use the record sheets to note down the results of your market research.