The Secrets of Business Forecasting in the Catering Industry

Imagine if you could predict the future. What would you want to know? How would you use that knowledge to your advantage? Granted, there is no way to see into the future, but you can use market conditions and past experiences to forecast what likely lies ahead.

The point of business forecasting is to make an educated guess about the future that will allow you to make the best decisions for your company. There’s no better time to do this than during the transitionary period surrounding the new year, as we prepare to welcome in new trends, challenges, and opportunities.

Here’s what the pros have to say about business forecasting in the catering industry.

Rely on historical data

Your past financial data and booking numbers host a wealth of information that can help you get a better idea of what to expect in the year ahead. Keep an eye out for useful trends, gaps that need solutions, and the overall successes and failures you’ve experienced in recent years. This can forecast what lies ahead, as well as provide you with real-world lessons to improve and grow in upcoming months.

“Catering forecasting is the toughest in my opinion,” shares Adam Gooch of Common Plea Catering. “This has to do with so many things that it is tough to nail down. I have had good success with just planning and working towards the busy periods we had last year or the trends from past years. As in my market, April through June is a busy wedding period, so we plan accordingly around that using historical data from last year - both on the financial and operational side.”

Anthony Lambatos of Footers Catering elaborates: “A solid cash flow plan is a must to get through the slow months. I always like to work off the past three years of financials. This gives you a good idea of your growth trend line and also allows you to minimize the impact of extreme positive months and extreme negative months. I also look at bookings relative to the same time the previous year. From there, you can begin to forecast your sales and expenses for the upcoming year.”

Look around you

The events industry is always changing, but there’s a lot you can learn by looking at the businesses around you and the rate of supply and demand within your local market. Global, national, statewide, and regional economic trends have an impact on consumer behavior, which will affect the business you do in the year ahead.

“The event business is a last-minute business as well as a business that sees events booked years in advance,” says Lon Lane of Lon Lane’s Inspired Occasions. “The number of pre-bookings in the coming year should give some clue to how the year is going to unfold. Check venue bookings online in your area to discover how many dates are booked. What portion or percentage of those dates are ones you have booked?”

Preparation is crucial when you’re running a business, especially in the often unpredictable catering industry. The more you can look back and around you, the better equipped you’ll be to take on the next year with confidence and perseverance.