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Catering, Vending and Cooking For The Masses. this forum is OnTopic. A resource to help with catering, vending and just cooking for large parties. Topics to include Getting Started, Ethics, Marketing, Catering resources, Formulas and recipes for cooking for large groups.


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Old 02-23-2015, 12:30 PM   #1
sunrise
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Join Date: 10-04-10
Location: Ventura CA.
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Once again I need to ask the Brethren for some help and advice. I was asked by a local butcher shop here in town to cook BBQ at their place on the weekends. The shop would supply the meats, and place to sell, I would provide my smoker, rubs, sauces & expertise of the cooking. The lady that runs the shop tried to do it herself, with limited success. She has a small smoker and limited knowledge. My problem is how & what to charge. She doesnt know either, and was hoping I did. I was thinking of a 50/50 split after expenses. The shop would have all the expense of the meat, and I everything else including my time. I want to be fair, but also dont want to cook & work for free. I know what I would charge for a catered event, but this is different. Any ideas and help would be appreciated. She has permits & licenses, as do I. So that parts a wash.
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Old 02-23-2015, 04:30 PM   #2
landarc
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If you think you can be happy with a 50/50 split, after expenses, then that seems very fair to her. I have always felt that it is not quite fair to the cook, as there is more to the process than just opening up some meat and calling it cooked. However, she has the shop, the meat and presumably, the kitchen space. To that end, 50/50 seems reasonable. That also spreads the risk, you either both make money, or neither make money.
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Old 02-23-2015, 04:30 PM   #3
bizznessman
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Here is my take on this arrangement and I will say up front that I may be in the minority.

I would make the following proposal. (and remember.......they asked YOU)
The Butcher Shop is supplying the Health Dept requirements, the raw ingredients and the facility to cook/sell out of. I am supplying my time, equipment and expertise. We will split the revenues, after my expenses, 50/50.

Calculate up the hours it will take you to cook/serve the product and multiply times your hourly rate. Just as an example our hourly rate for this would be $100/hour. We have calculated this hourly rate to cover our expenses; depreciation of smoker/equipment, rubs/etc, fuel, our profit/labor etc.

Let’s assume you spend 20 hours working the weekend. This includes all prep, fire tending, etc.

Once the weekend is over let’s say the gross sales are $5,000.

Total up the hours you worked x $100/hr. Let's say this comes to 20 hrs x $100 = $2,000. This is your "pay".

The net, in this scenario, would be $3000 ($5,000 gross less $2,000 your pay). Split this net 50/50 ($1,500 each).

Butcher shop gets $1,500
You get $3,500


Some would say this is not “fair”. But here is why I believe it is. The Butcher Shop benefits from having someone else expend the labor for having on onsite marketing campaign and customer draw activity.


I know of two locations that have an arrangement like this that actually write off the $2,000 (your “pay”) as an EXPENSE since they list it as advertising. It is definitely a win for them. If they balk at this and say they need more out of it then let them buy the equipment, pay someone with expertise to operate it and do it themselves. They will quickly find out that your offer is the better way to go.


BUT MOST IMPORTANT IS TO WRITE UP A CONTRACT. DON’T GO INTO ANYTHING LIKE THIS WITHOUT ONE.


NOTE: If you don't already have these you should also consider getting an FEIN (Federal Employer Identification Number), state sales tax number and liability insurance of your own. They may not be needed for this arrangement but could be depending on how the "splitting" up of gross income is done. An accountant could give you better advice on this than I.
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Old 02-23-2015, 05:34 PM   #4
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I've tried to give an answer for an hour now and just can't. So I'm staying out of this one
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Old 02-24-2015, 07:48 AM   #5
early mornin' smokin'
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bizznessman hit a lot of nails on the head, and 100/hr isn't unreasonable to charge someone, my mechanic gets 125. CONTRACT!!!! However, he left one huge part of the calculation out. Food cost. To do $5000 in sales, assuming 1/3 costs, 1/3 meat, 1/3 her, 1/3 you, you're looking at about $1600-1700 in food costs. Jesus, please, get a contract. I had the same arrangement when I started out with my local butcher. I was making bacon at the time. hindsight is 20/20, good people turned out to be bad people and I never saw a dime. My arrangement was the same as you're initially proposing. However, tread lightly. First off, to do $5000 in sales of bbq in a weekend you're going to need about 400lbs of raw meat. How do I come up with that?

Lets say you're getting $20/lb for bbq. To do $5000 in sales, you'll need to sell 250lbs of product. To get 250lbs of finished product, you need to start with almost double due to cooking losses.

So lets be more realistic, you sell about 100lbs of bbq in a weekend, presumably $2000 in sales. That 100lbs of finished que. probably cost between $400-600 just for the raw product.

now add in expenses, I don't know what kind of smoker you're running, but I can presume you'll need at least 40-50lbs of charcoal to cook all that food, or at least a bag of pellets.
tack on another $50 for wood and fuel

Rub, rubbing close to 200lbs of meat takes some product, tack on another $20 for rub.

So for arguments sake, there's around $800 in expense. If you do $2000 in sales, you're looking at $600 for your profit for the weekend, and that's assuming you have a sell out, nothing left but maybe scraps weekend.

Now, the questions.
Who's serving the product?
Is she willing to take the risk of buying cases of meat?
What happens if you're sitting on a ton of unused product?
Who will be there representing your product and brand?
Will you get to book your own catering out of clients, or will they have to be sold thru the butcher?
Why are you willing to promote this lady's business over yours?
How will you be accounting for the sales of your bbq vs. her food? IE, cold salads and other sides that people may buy when they're purchasing your meat also.

With all that said, unless you know this person, WELL. Unless you have a strong contract clearly outlining, run away. If she really wants to add bbq to the menu, tell her you'll work for a reduced rate of $50/hr.
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Last edited by early mornin' smokin'; 02-24-2015 at 07:53 AM.. Reason: forgot stuff
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Old 02-25-2015, 03:51 PM   #6
bizznessman
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Quote:
Originally Posted by early mornin' smokin' View Post
bizznessman hit a lot of nails on the head, and 100/hr isn't unreasonable to charge someone, my mechanic gets 125. CONTRACT!!!! However, he left one huge part of the calculation out. Food cost. To do $5000 in sales, assuming 1/3 costs, 1/3 meat, 1/3 her, 1/3 you, you're looking at about $1600-1700 in food costs. Jesus, please, get a contract. I had the same arrangement when I started out with my local butcher. I was making bacon at the time. hindsight is 20/20, good people turned out to be bad people and I never saw a dime. My arrangement was the same as you're initially proposing. However, tread lightly. First off, to do $5000 in sales of bbq in a weekend you're going to need about 400lbs of raw meat. How do I come up with that?

Lets say you're getting $20/lb for bbq. To do $5000 in sales, you'll need to sell 250lbs of product. To get 250lbs of finished product, you need to start with almost double due to cooking losses.

So lets be more realistic, you sell about 100lbs of bbq in a weekend, presumably $2000 in sales. That 100lbs of finished que. probably cost between $400-600 just for the raw product.

now add in expenses, I don't know what kind of smoker you're running, but I can presume you'll need at least 40-50lbs of charcoal to cook all that food, or at least a bag of pellets.
tack on another $50 for wood and fuel

Rub, rubbing close to 200lbs of meat takes some product, tack on another $20 for rub.

So for arguments sake, there's around $800 in expense. If you do $2000 in sales, you're looking at $600 for your profit for the weekend, and that's assuming you have a sell out, nothing left but maybe scraps weekend.

Now, the questions.
Who's serving the product?
Is she willing to take the risk of buying cases of meat?
What happens if you're sitting on a ton of unused product?
Who will be there representing your product and brand?
Will you get to book your own catering out of clients, or will they have to be sold thru the butcher?
Why are you willing to promote this lady's business over yours?
How will you be accounting for the sales of your bbq vs. her food? IE, cold salads and other sides that people may buy when they're purchasing your meat also.

With all that said, unless you know this person, WELL. Unless you have a strong contract clearly outlining, run away. If she really wants to add bbq to the menu, tell her you'll work for a reduced rate of $50/hr.


Early Mornin really drilled down into this one. And I agree on each and every one of his points.

These (and more) are the reasons you should do this WITHIN THE PARAMETERS OF A CONTRACT. Do this one time, with bad results, and you will learn why it is SO important.
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