Any caterers on here

[dazco]

I have become the proud tenant of a cafe, the rent is £200 a week and the rates another £100, I have to pay gas and leccy and am only open for five days.

What kind of mark up should I be looking at and how much do I need to sell just to break even with everything considered. There are no wages to pay.

Also, does anyone know of any good suppliers in the North West.

[sniff diesel]

dazco said:

What kind of mark up should I be looking at and how much do I need to sell just to break even with everything considered.

Erm, shouldn't you have looked into these things before taking on the business?

[missdiane]

But you need to pay your own wages?

[paintman]

The books of the previous tenant of the cafe would have been a good place to start before committing yourself.
Did the previous occupier fail or have you taken over a going concern?
What previous experience have you of the cafe trade? What qualifications in the food industry?

If what you've posted is right, you have come at this from completely the wrong direction, but I wish you luck.

Edited by paintman on Monday 16th November 20:59

[missdiane]

The question is a bit like how long is a piece of string- as it all depends what you are selling and they will all vary,

write down what you are selling,
what you would be prepared to pay as a customer
have you done market research on competitors?,
get suppliers and quote from suppliers,
work out what it costs you to make all individual products
work out your own wages- nobody works for free
add on rent and bills and anything else you need to consider- EVERYTHING, even down to ink in the printer.

When you have your total cost of what this item costs you can then consider what profit to put on; then you have to add on your tax


You will then discover nobody in catering gets rich without the niche in the market

[Piglet]

Water? Business rates? Insurances?

[tango2]

Hopefully you did some research as mentioned before.

Have you got the premises registered with the LA as a food premises - a necessity for all foodie operations - legal requirement
Do you have any hygiene and safety qualifications? - legislative bits all need adhering to
Please say you've got publie liability insurance....?
That's before you wonder about the 'mark-up' - which is a concern as food operations work on Gross Profit margins - if you've not got the above sorted, you shouldn't be trading

Hope you have - and hope it goes well

[dudleybloke]

i'l have a B.E.S.T on toast with mushrooms and brown sauce please.

[Engineer1]

Up north and Pasties??

[dazco]

sniff diesel said:

dazco said:

What kind of mark up should I be looking at and how much do I need to sell just to break even with everything considered.

Erm, shouldn't you have looked into these things before taking on the business?

Not really. I know cafes can make money and I would not expect the rent to be a penny less considering the standard of the place, so it should do well. I just wondered if there was an industry standard for the marking up of food.

[dazco]

tango2 said:

Hopefully you did some research as mentioned before.

Have you got the premises registered with the LA as a food premises - a necessity for all foodie operations - legal requirement
Do you have any hygiene and safety qualifications? - legislative bits all need adhering to
Please say you've got publie liability insurance....?
That's before you wonder about the 'mark-up' - which is a concern as food operations work on Gross Profit margins - if you've not got the above sorted, you shouldn't be trading

Hope you have - and hope it goes well

It was built as a cafe so has a full food license.

I am not trading yet, should be in the new year.

[Simpo Two]

dazco said:

I just wondered if there was an industry standard for the marking up of food.

As your industry is no doubt competitive and punters will be more interested in the price you sell at rather than the price you bought at (which determines a 'cost-plus' approach) - in your position I'd start off with prices that are about industry-average and work it backwards. The difference is your gross margin (ie before all the other costs are deducted).

[mcflurry]

dazco said:

I am not trading yet, should be in the new year.

Can you open earlier? As Christmas can be a busy period in Cateringville

[dazco]

mcflurry said:

dazco said:

I am not trading yet, should be in the new year.

Can you open earlier? As Christmas can be a busy period in Cateringville

Not here it won't be, it is on a business park.

[tango2]

dazco said:

tango2 said:

Hopefully you did some research as mentioned before.

Have you got the premises registered with the LA as a food premises - a necessity for all foodie operations - legal requirement
Do you have any hygiene and safety qualifications? - legislative bits all need adhering to
Please say you've got publie liability insurance....?
That's before you wonder about the 'mark-up' - which is a concern as food operations work on Gross Profit margins - if you've not got the above sorted, you shouldn't be trading

Hope you have - and hope it goes well

It was built as a cafe so has a full food license.

I am not trading yet, should be in the new year.

You'll still need to be registered as a new owner, even if you're taking over an existing business/construction, and expect the EHO to follow shortly - it happened to us this year and I work in the corporate world - took over an existing contract and it all needs re-registering in the new op co name etc

[Landlord]

dazco said:

mcflurry said:

dazco said:

I am not trading yet, should be in the new year.

Can you open earlier? As Christmas can be a busy period in Cateringville

Not here it won't be, it is on a business park.

It's a bit scary that you don't already know this sort of stuff - but, broadly, use a rule of thirds.

That is;

Cost of item(s) equals £1. Sell for £3. One third cost, one third profit and the final third to cover rent, rates, leccy, etc.

Now - use this as your benchmark and then, look at your competition, and decide to move the sale price up or down based on what you can get away with.

Then, to work out your GP on your food (which should be between 63% and 78% - but can be higher. Indeed it can be lower but you don't really want it to be), use this equation;

GP = (Sale price ex. VAT - Cost Price)/Sale Price ex VAT

[dazco]

Landlord said:

dazco said:

mcflurry said:

dazco said:

I am not trading yet, should be in the new year.

Can you open earlier? As Christmas can be a busy period in Cateringville

Not here it won't be, it is on a business park.

It's a bit scary that you don't already know this sort of stuff - but, broadly, use a rule of thirds.

That is;

Cost of item(s) equals £1. Sell for £3. One third cost, one third profit and the final third to cover rent, rates, leccy, etc.

Now - use this as your benchmark and then, look at your competition, and decide to move the sale price up or down based on what you can get away with.

Then, to work out your GP on your food (which should be between 63% and 78% - but can be higher. Indeed it can be lower but you don't really want it to be), use this equation;

GP = (Sale price ex. VAT - Cost Price)/Sale Price ex VAT

Thanks for that, that was what I was looking for.

I thought it should be something like that to cover all the overheads but it seemed a little much, you have put my mind to rest.

Now I just need some prices off suppliers so I can do costings but that seems like trying to get blood out of a stone.

[dudleybloke]

so then.... how much for the sandwich i want?
i usualy pay between £2.20 and £2.70 for this dependant on which cafe i go to.

some tips.
only use good back bacon and decent quality sausages.

charge 30p extra for crusty bread.

hot roast pork for lunchtimes. always a winner!

hope it goes well for ya and hurry up with my sandwich!
im starving!

[dazco]

dudleybloke said:

so then.... how much for the sandwich i want?
i usualy pay between £2.20 and £2.70 for this dependant on which cafe i go to.

some tips.
only use good back bacon and decent quality sausages.

charge 30p extra for crusty bread.

hot roast pork for lunchtimes. always a winner!

hope it goes well for ya and hurry up with my sandwich!
im starving!

There will be no rubbish ingredients on my watch.

That will be £2.50 please, we have no crusty bread it has all sold out already.

[Landlord]

That's another thing - you'll get EVERYONE telling you what you must/mustn't do to make the perfect cafe/pub/whatever. Usually these will contradict each other so if you try to please one, you'll be pissing off another. Listen to feedback but make your own judgement on it rather than treating it as gospel. Have a vision for yourself and follow it.

Of course, if the same complaint crops up a number of times, there's probably something in it. I'm talking about "What you want is proper artisan poppy seed bread, I guarantee it'll fly out of the door"... "I hate bread with bits, give me a nice plain white any time" etc.