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Small Business Ideas: Start a Catering Service


One of your small business ideas may be to start a catering business. This type of business can easily be run out of your home and, because the startup costs are relatively low, be immediately profitable. Discussed below are aspects of a small catering business to include when researching it as a potential business opportunity.

Consider Focusing Your Catering

By definition a small business operates on a much smaller scale than other local or national companies. Your small business will have fewer employees and may actually be you working by yourself. You will also have less capital to start and operate your business and only be able to fulfill a few orders at the same time. Because of this, you might want to consider narrowing the focus of your catering business. Think of the foods you make best and decide whether offering one or two items will allow you to function better and still make a profit. A catering company can be narrowed to provide just desserts or appetizers and still be successful.

Think Small

If you are the sole employee of your business, consider limiting the size of the parties you agree to handle. As the sole employee, you may not be able to handle providing food for 200 people, but may be able to perfectly manage a party for 50 or fewer guests. Prior to beginning your business, determine the largest size party you can handle and make that the maximum size job you will accept.

Determine Your Legal Requirements

Most states require companies that provide food to the general public to be licensed or meet certain health and safety standards. When you begin to set up your business, you must determine what you need to operate legally. Potentially, you may be required to obtain a license or insurance. If your business does not comply with state or local laws governing its operation, you may be subject to fines or open yourself to being sued.

Investigate Insurance Options

During the setup process, you should also investigate whether insurance exists to protect you against liability. An insurance policy might protect you if someone becomes sick after eating your food, if you damage the client's property, or if you are unable to fulfill your contractual obligations for a party. Insurance may be the best way to eliminate certain risks associated with running a catering business which, if they occurred, might require you to pay for damages out of your own pocket.

Additionally, many states may require small businesses to be insured. Check with your local business license agency to determine whether you are obligated to purchase insurance. If so, ask for a list of providers that offer the required insurance policies.

Anticipate Growth

One of the most often overlooked aspects of a small business is whether growth is possible or desired. Consider what you will do if your business is a success. Will you grow your business's scope or are you content with remaining small? You can always change your mind at a later date, but this decision will impact the amount of money you invest and the supplies you initially purchase. 

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