How do I review a catering company’s event reorder rate and referral sources?
Ask for a client list with every event, date and source, then sort it to see who returned and who came through whom. Repeat corporate accounts and regular referrers matter most. Check that the same names appear in the invoices. Then ask whether those relationships belong to the business or to the owner.
Ask the seller for an event-by-event list covering the client, the date, the value and how the client first found the caterer. Check it against invoices and bank deposits. Sort by client to see who comes back, and sort by source to see where new clients start.
Look for concentration. A caterer who gets work from one planner, one venue or one office manager is exposed if that person moves on. Ask how the referrer is thanked, whether anything is paid and whether the relationship is written down. Ask which referrers would be told about the sale, and when.
Compare what you find with the owner’s day-to-day role. If the owner personally knows each repeat client, you will need a handover plan. Ask for introductions, and consider a transition period in which the seller helps. Your accountant can confirm that the revenue in the list agrees with the financial records. Also read the reviews and messages from past clients. The words they use to recommend the caterer tell you what they value, and whether that quality depends on a particular person or on the whole kitchen.
Key takeaways
- Sort events by client and by source to see repeat and referral patterns.
- Check concentration in a few planners, venues or accounts.
- Ask whether relationships belong to the business or to the owner.
- Read client reviews for what people value and who delivers it.
Related reading
15 pages on the same subject, grouped by topic.
Buying
- Expert answerWhat happens to a catering company’s booked events when it is sold?
- Expert answerDo a caterer’s event staff work as contractors or employees when I buy?
- Expert answerWill a catering company’s corporate clients stay after the owner leaves?
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- Expert answerHow do I check a catering company’s tasting menus and proposal templates?
Selling
- Expert answerHow do I hand over my catering menus and event run sheets to a buyer?
- Expert answerHow do I show buyers my packaging company’s customers reorder on a steady cycle?
- Expert answerHow should I present my catering company’s signature menus to a buyer?
- Expert answerWhich lead sources should a moving company owner write down for a buyer?
Due diligence
- Expert answerHow do I check a physiotherapy clinic’s referral sources before buying?
- Expert answerHow do I review a language school’s reliance on international student referrals?
- Expert answerWhat does a last-mile delivery company’s missed-delivery rate say about its operations?
- Expert answerHow do I review contracts with venues at an event planning company?
- Expert answerHow do I check a butcher shop’s regular meat sources and delivery days?
Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
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