Catering Company - Bad target for a Search?

searcher profile

April 02, 2019

by a searcher from University of Virginia-Darden - Darden School of Business in Baltimore, MD, USA

Reviewing an opportunity in the catering space, has consistently had ~$600K in  EBITDA and ~$2M in revenue with strong relationships in the local wedding space.  I haven't seen a lot of interest from Searchers in Caterers and am wondering why, do people group them with Restaurants or not see any ability to scale?  Would greatly appreciate anyone's thoughts!

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commentor profile
Reply by a searcher
from Northwestern University in Chicago, IL, USA
Catering is far superior (generally) to restaurants. Revenue is contractual, with many opptys to be recurring (e.g. annual corporate xmas party). Plus you have a greater ability to predict and manage costs (avoiding food cost waste b/c you know exactly how many people you are feeding).

Generally, I'm not a fan of consumer businesses or restaurants. However, there are definitely some enduringly profitable catering businesses out there. This model is very similar to the party equipment and supplies rental business model, which is a pretty well traveled searcher path.

Just my thoughts!
commentor profile
Reply by a searcher
from The University of Chicago in Denver, CO, USA
I know this is an old thread, but it seems to be one of the only ones that mention catering. I bought a (drop off only) catering business in###-###-#### was as brutal as you would expect, and halfway through 2021 we are back to about 50% of "normal" revenue, since we rely 100% on corporate meetings. I'm happy to chat with anyone looking at this space.
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