How to Price a Catering Menu

You have chosen the dishes for your catering menu. Now you need prices.

This article gives you a step-by-step method for pricing a catering menu from the ground up. It does not give you a magic margin or a single "right" price, because those depend on your costs, your market, and your business goals. It gives you a repeatable process you can apply to every item and package.

If you have not built your menu yet, start with how to create a catering menu for your restaurant. For the principles behind catering prices, see how much should a restaurant charge for catering?

Step 1: Calculate Ingredient Cost

Start with the food.

For each catering item, list every ingredient and its cost per unit, then calculate the cost of one catering portion or one tray.

Tips:

• Use current supplier prices, not last year's
• Include garnishes, sauces, and dressings
• Account for trim and waste, such as bones, peels, and cooking loss
• Recalculate when supplier prices change significantly

This gives you the food cost per portion or per tray.

Step 2: Estimate Portions

Portions turn recipe cost into per-guest cost.

Decide:

• The portion of each item per guest
• How many guests each tray serves
• How portions change between lighter and heartier meals

For packages, add up the portions in a typical guest's meal. If a package includes a choice of two entrées, use a realistic average portion across both rather than double portions.

Write portion guides down. Your price is only accurate if the kitchen portions consistently.

Step 3: Add Packaging

Catering packaging is a real cost and easy to underestimate.

Include:

• Pans, trays, boxes, and lids
• Sauce and dressing cups
• Labels
• Plates, cutlery, napkins, and serving utensils if included
• Bags or carriers that leave with the order

Calculate packaging cost per guest or per tray and add it to your food cost.

Step 4: Account for Labor

Catering labor includes more than cooking:

• Prep and cooking
• Portioning and packing
• Labelling and checking the order
• Loading and delivery
• Setup on site, if offered

Estimate the time a typical order takes at different sizes and multiply by your labor cost. Some restaurants include labor in the per-person price; others charge separately for delivery and setup. Either approach works if it is consistent and covers the real time.

Step 5: Account for Delivery

Delivery costs include driver time, fuel, vehicle wear, insurance, and any third-party service fees.

Common approaches:

• A flat delivery fee within a set radius
• Distance-based delivery fees
• Delivery included above a minimum order size

Choose an approach that covers your actual cost. If delivery is "free," make sure its cost is built into your menu prices.

Step 6: Account for Overhead

Overhead includes rent, utilities, insurance, equipment, software, and payment processing.

You do not need a perfect allocation. A reasonable approach is to estimate what share of your overhead catering uses and make sure your prices contribute toward it. As catering grows, revisit that estimate.

Step 7: Determine Your Desired Profit

Once you know your costs, decide how much profit an order needs to make to be worthwhile.

There is no universal correct margin. Consider:

• The effort and risk involved in catering compared with regular service
• How much catering revenue you want to generate
• What your market will support
• Whether some orders bring repeat business that justifies a different approach

Set a target that makes catering genuinely worth doing. For a closer look at order profitability, read how much profit should a catering order make?

Step 8: Build Package Pricing

With costs and profit targets in place, price your packages.

For each package:

1. Add up food cost per guest for a typical selection
2. Add packaging per guest
3. Add labor per guest at a typical order size
4. Add a share of overhead
5. Add your profit target
6. Round to a clean, sensible price

Then consider:

• Minimum guest counts so small orders still cover fixed effort
• Choice ranges so the most expensive choices do not erode margins; if one entrée costs far more than the others, price it as an upgrade
• Add-ons such as extra sides, desserts, and drinks, priced individually

For per-person packages specifically, see catering pricing per person.

Step 9: Review Pricing Against Local Alternatives

Your cost-based price tells you the minimum you need. The market tells you what customers expect.

Compare your prices with similar catering options in your area:

• Similar formats and service levels
• What is included, such as drinks, dessert, and delivery
• Portion sizes and quality

If your price is well above comparable options, check whether your costs or portions are out of line, or whether you offer something worth paying more for. If your price is well below, you may be leaving money on the table.

A price near the middle of your local market, supported by reliable service and good food, is often a stronger position than the cheapest price. Competing on price alone tends to squeeze margins.

Step 10: Revisit Pricing Over Time

Catering prices are not set-and-forget.

Review them:

• When ingredient or packaging costs change noticeably
• When wages change
• A few times a year as a routine
• When you notice certain packages are much more or less popular than expected

Small, regular adjustments are easier for customers to accept than large, sudden increases.

A Note on Simplicity

Pricing every possible combination separately creates confusing menus and slow quotes. Clear packages with a small number of priced add-ons make pricing easier for you and ordering easier for customers.

Where Caterly Helps

Pricing a whole catering menu takes time, especially comparing it with your local market.

Caterly reviews comparable catering pricing in your area, suggests package prices aimed at the competitive middle of your market, and explains the reasoning and its confidence in each suggestion. You stay in control of the final prices.

Explore more in Catering Pricing.