Is starting a banquet hall a good idea even if I have no food service experience?

[chelle21689]

Hello, everyone. I've been trying to figure out for a long time what I've wanted to do. I had no idea but I knew one thing, I always wanted to own my own business but I had no idea what until today. I would love to own a banquet hall that caters to receptions and other special events.

I want to be able to provide some supplies like chairs, tables, silverware, etc. I like the idea of recruiting, marketing, alcohol, and all of that not necessarily be an event planner. The thing is, I know a lot of banquet halls have in-house catering but I don't know if I'd like to start off that way. I don't have restaurant or catering experience but I do come from a family of business entrepreneurs that are successful in Asian grocery, restaurant, day care, etc.

I do have an idea of what I'd like to do though. I mean, not everyone likes the option of HAVING to go by the banquet caterers but would like to provide their own food or choice of cater. I would like to partner up with some restaurants or caterers that might be able to give them a decent rate while we can still make profit. Is this doable without having a whole restaurant/banquet?

Also, what about rent? I would like to own but I know it's very pricey.

I don't think I've ever felt so excited and passionate about a business idea. It's something I'm still researching on. I know there's so much to think about like licenses, rent, etc. Oh, and target audience.

I'd like it to be mixed. There's a big Asian community that likes it cheap and brings their own stuff and just wants a place to rent.
But then again, I'd like to cater to everyone not just the Asian community.

Like all businesses, it's a very scary idea but I'm very interested.

[nealrm]

So you came up with the idea today and are in-love with it. My first suggestion is to sleep on it for a few nights, see if your opinions change. If you are still liking the idea, find a banquet hall and go to work for them. You need to get an idea of what it is like to work at a banquet hall BEFORE you go out and try to start one. Right now you THINK you now know what is involved, but you really don't. If you still like it in 6 to 12 months, then look at starting your own.

[chelle21689]

Well yeah, I'm not an idiot lol. That's why I said I'm going to research up on it and take my time thinking if it's something I really want. Not going to jump right into something new.

But you didn't really answer my main question if it is doable without in-house catering providing wait staff.

[chelle21689]

How about shadowing a manager a few times? Maybe call and ask for an internship and be an assistant for free part time for a few weeks?

[nealrm]

I think it is doable without having an onsite food-service. Teaming up with local businesses would be a good option. You would need to check your local market to see what that would do with your ability to compete.

[chelle21689]

I'm starting to feel a bit sad now, because you and my sister say I need experience. The only experience I qualify for is probably server jobs which make near minimum wage and I don't know if I can afford x amount of years to build that type of experience of seeing what goes on behind the scenes.

[nealrm]

For some minimum wage is a starting point, for others it is an ending point. The difference between the two is that one is there until they get the experience to move up, the other person is there because they think it is the only job they can get. Be sure to be in the first group and not the second.

[Steve B]

I think there is a reason the other places have the catering done in-house. I'm guessing the profit from just the rental will not be enough to pay your bills. Or, you would have to charge a much higher rent than other places and you would lose your community that likes things cheap.

Also, working as an intern for a few weeks would get you a few weeks of experience. That sounds like a recipe for failure to me. I would suggest working for two different catering companies for the next 2 or 3 years - then you might be ready to start a business (assuming you have or can quickly get the necessary business skills).

I know it sounds like I'm bursting your bubble - but, I think you need to be realistic. If you only think you are qualified for min. wage server jobs, then how can you be qualified to run your own business? Get yourself A LOT more qualfied and keep working toward your goal.

[Wozcreative]

Did you just say you thought of the idea today and you're suddenly passionate about it? Is that even possible without experience this type of career? How can someone be passioante about something they know nothing about.. Many reasons why people need to do either a lot of years of experience working in that industry or learning about the industry/business your going into. Knowing how rent out a building is one thing, but then you need to know how to deal with any issues, food, supplies, paying people, taxes, providing benefits, hiring an accountant, food safety, alchohol licensing, photographers, marketing locally, marketing via online.Cost and profitability, the money you can put down to start it up, future growth plans of the business and how you plan to make money. Knowing WHEN you will be profitable and how long you will be in the hole. Knowing how many hours it will take, dealing with hiring/fixing damaged goods. Being up late to help manage and clean up the place after it's been trashed by an event. Being responsible for what happens if something happens, soemone gets sick, someone hurts themselves etc.
You will need a janitorial staff to make sure the washrooms are replenished and clean. Cleaning up/vacumming/washing all the carpets from all the drinks and the glitter and all the flowers etc. And ofcourse dealing with BRIDEZILLAS!

[huggytree]

your odds of success w/o any experience are very low....probably single digit low

you cant just pick something you have no experience in and expect to be successful in business

pick your idea, then get a job in that field....spend a few years and learn how its done....who the suppliers are, how they find their customers.....then look for ways that you could it better...w/o the experience how do you know what to do or expect

you could look to buy an existing business that already runs itself.....but w/o the experience yourself id think that would fail at some point of crisis when you made the wrong decision

you need to be an expert at what your going to do...not a novice

experts fail every day.....how will someone who is just guessing at what to do succeed????

[chelle21689]

Okay, so what's the first step I need to take? Get a server job at a banquet hall? Get a job as an event coordinator? Shadow a banquet manager? What's the deal here.

I'm trying to find at least assistant manager jobs which I may have a chance at but there's hardly any here.

[Jim Briggs]

Some additional suggestions. Make a list of people to talk to in the business and start learning more about it. Find someone with experience in the industry to mentor you. Experienced and successful entrepreneurs often like to help enthusiastic newbies. After talking to 10, 20 people in the biz, you can figure a good next step.

Talk to owners of banquet businesses (or closely related). Shadow one of the owners--it will be an enlightening and inspiring experience if you get the right owner. (I personally guarantee it or i'll refund the total cost of reading this post). Then come back and tell us what you learned.

Note. If you're thinking about substituting starting a business for getting a job, that might not work too well. I can guarantee that one too. ;)

[billbenson]

Look at things differently. Work experience is kind of like college. It's education. Treat it as such. And think in terms of years, not weeks. When you get home from work go on line and study more. If you have a question as to why something was done a certain way study it. Woz gave you a good list of things to think about studying.

Also, since you are just starting out, think about the business you would really like to be in. A banquet hall sounds like real estate to me. You mention food service. That's one of the hardest businesses out there. Most chef's work their butt of and don't make much money.

If you take our advice and decide to work in an industry and learn it before plunging into it, do some research as to what industry you really want to learn. Different businesses have different possible earnings. A business mowing lawns is going to have a much lower income potential in most cases than selling investments. Look at the people on this forum and what they do. The long time members are probably all making a good living at what they do. Some make more than others because of their industry or other choices.

Do some research before you dedicate yourself to something!

And above all, don't be afraid to go out of your comfort zone and try something. Put a plan together and do it!

[huggytree]

Okay, so what's the first step I need to take? Get a server job at a banquet hall? Get a job as an event coordinator? Shadow a banquet manager? What's the deal here.

I'm trying to find at least assistant manager jobs which I may have a chance at but there's hardly any here.

why would someone hire you as an assistant manager if you haven't had any experience? or am I mistaken? do you have experience managing people

when I started in plumbing I took a 5 year apprenticeship...I dug sewers with a shovel for years, then 3 years as a journeyman and they I was able to take a test to get masters license....I took 8 years to completely learn my trade...my old boss managed things badly...he wasn't even around much...I learned that anyone could succeed if he could(he lived a very good life with only 2 workers)....I noticed things like all his eggs were in 1 basket(he had 1 main customer)....when I went into business I made sure I had 10+ main customers....his main customer fired him since I left and he's in a world of hurt......this is the type of stuff you need to learn and observe when your working for someone else...you learn how to run a business better than your boss

if you want to open a banquet hall the first thing you need to do is get a job in a banquet hall...whatever job your qualified for...then try to move up to a manager at some point

[chelle21689]

I don't see why anyone would mentor me if they knew my goal because then it would mean competition for them I'm the future. I've just always wanted to own my own business and be proud of what I started like a lot of my family and it sucks that I'm not knowing what to so or what I would be good at. Guess I have to keep figuring out what it is.

[chelle21689]

My parents do want me to take over the business. It's probably the only thing I have background knowledge in. It's just an Asian grocery that's been here for 30+ years next to our uncles restaurant. It does very well and we are very well known...

It's just what can I do to feel proud of my own accomplishments rather than just receiving my father and mothers business? I think it could use a big face lift lol. customers can be annoying and rude especially when foreign but I know how to handle it.

The only thing I would need to learn is taking care of the financial aspect of the business like keeping track of the income and the banking that's it.

[nealrm]

There is no such thing as just a grocery when it has been there 30 years. That is a huge success.

[chelle21689]

The Thai restaurant is next door which my dad started and gave to his brother to run so he could have a job. He must've done something right because it's been winning awards. But yeah, we depend on each other for business in a way. I would take it over if I didn't have issues with not feeling proud of myself for starting something from ground up...I mean, would you feel accomplished and proud if a business was handed over to you??

Business ain't like it used to be. I mean we do good but not as great as before.. but we used to be the only spot with an Asian grocery/restaurant and now over the years there are tons of them.

Another thing is, my dad's two other brothers kind of have a place in the store where they just take up space. They're never there and don't work hard and I can't kick them out lol Meaning my uncle is kinda lazy...scratch that really lazy.

[Paul]

Don’t despair. All good advice about needing experience.

However, if you really are passionate about getting into this business don’t just research. Start working at it. You actually answered some of your own questions.

Here’s my idea.

1) If you are Asian or familiar with Asian cuisine and your business is located in an Asian community and you expect most of your customers will be Asian, then just focus on that market. Don’t try to be everything to everyone. Build your niche. It’s right in front of you.

2) Take steps. Find a caterer or restaurant that will work with you like you said.


3) Find a hall or facility that will rent to you for occasions. Not a long term rental, just when needed.

4) Find a rental supply company for tables etc (if the hall doesn’t have them)

5) Get all the pricing organized, get familiar with the menu etc.

6) Find some local D.J. or bands in case you need entertainment.

7) Think of anything else you possibly might need.

8) Create your price list based on a markup of your costs.

9) Find someone who needs an event.

10) Then organize it, do it and learn.

Even if you don’t make money, or even lose some, it will be the fasted crash course in the catering hall business you’ll ever get. After you finish your first event you will know if you like it, if it can be profitable, and if you are capable. If it’s a go eventually you can get a permanent location etc.

Good luck!

[Paul]

I would take it over if I didn't have issues with not feeling proud of myself for starting something from ground up...I mean, would you feel accomplished and proud if a business was handed over to you??.

Don't be proud, be smart! If you have an opportunity to take over a family business you should. In fact you should be PROUD that your family wants you to take it over. Make them proud of you...do it right.

You will be proud and accomplished when you grow the business, expand to other locations, employ people and be part of the local economy.

Millions of people wish they the opportunity to take over an existing business. My personal experience is that I did have that chance, and still regret that I didn't many years later.

Starting a business isn't the key to fulfillment. Doing a good job at whatever you do is the key. Of course making money helps too!

[Jim Briggs]

Paul,

I totally agree with both your posts. Having your own business could be venturing out with something risky or it could be taking over your family business. Both are valid ways to be a small business person.

[nealrm]

Don’t despair. All good advice about needing experience.

However, if you really are passionate about getting into this business don’t just research. Start working at it. You actually answered some of your own questions.

Here’s my idea.

1) If you are Asian or familiar with Asian cuisine and your business is located in an Asian community and you expect most of your customers will be Asian, then just focus on that market. Don’t try to be everything to everyone. Build your niche. It’s right in front of you.

2) Take steps. Find a caterer or restaurant that will work with you like you said.


3) Find a hall or facility that will rent to you for occasions. Not a long term rental, just when needed.

4) Find a rental supply company for tables etc (if the hall doesn’t have them)

5) Get all the pricing organized, get familiar with the menu etc.

6) Find some local D.J. or bands in case you need entertainment.

7) Think of anything else you possibly might need.

8) Create your price list based on a markup of your costs.

9) Find someone who needs an event.

10) Then organize it, do it and learn.

Even if you don’t make money, or even lose some, it will be the fasted crash course in the catering hall business you’ll ever get. After you finish your first event you will know if you like it, if it can be profitable, and if you are capable. If it’s a go eventually you can get a permanent location etc.

Good luck!

This sounds more like a recipe for disaster than anything else. It's the business equivalent of learning to swim by jumping into the deep end of the ocean with the only idea of how to swim being a few post on an internet forum. The chance of this being a positive experience is slight, while the risk of someone's event being ruined, you losing money, and your reputation being stained is very high. The worst case scenario is that you will not only lose money, but the holder of the event take you to court for ruining their party.

(Read the ENTIRE statement before you start objecting)
Also, prices should never be based on costs. This is a fallacy that many businesses follow. Prices should be based on what people are willing to pay. The amount of work and your cost have nothing to do with the price. However, cost and your work do facture into your decision to offer that product or service at the price set by the market. It is very important that you understand this. It is very possible that the market is willing to pay much more than what you think is reasonable based on your cost and effort, the market may also be willing to pay much less.

[Paul]

This sounds more like a recipe for disaster than anything else. It's the business equivalent of learning to swim by jumping into the deep end of the ocean with the only idea of how to swim being a few post on an internet forum. The chance of this being a positive experience is slight, while the risk of someone's event being ruined, you losing money, and your reputation being stained is very high. The worst case scenario is that you will not only lose money, but the holder of the event take you to court for ruining their party.

(Read the ENTIRE statement before you start objecting)
Also, prices should never be based on costs. This is a fallacy that many businesses follow. Prices should be based on what people are willing to pay. The amount of work and your cost have nothing to do with the price. However, cost and your work do facture into your decision to offer that product or service at the price set by the market. It is very important that you understand this. It is very possible that the market is willing to pay much more than what you think is reasonable based on your cost and effort, the market may also be willing to pay much less.

I respectfully disagree.

My apologies to Chelle for referencing him in this post!

I would definitely agree if this was a different kind of business. To be a plumber, accountant, doctor or lawyer you obviously need education and experience. But coordinating an event is pretty basic stuff, relatively speaking.

He can research and work as a waiter for as long as he likes. Eventually he has to take the plunge. In this case the plunge into the deep water is with an experienced swimmer and a life jacket (the actual caterer). I also assume if he’s researching the subject he understand the basics.

If you noticed, I said find a caterer that will work with him. Obviously, he has to find one that knows what they are doing. I didn’t tell him to take a cooking class and prepare the food himself.

Clearly, he is dependent on others who are experienced to do this. He just has to coordinate it all.

I didn’t want to make a long detailed list of every little thing that has to be done. I expect a person who wants to go into business can figure out the details.

I did make one assumption. That being that I am sure he is competent enough to coordinate an event. I don’t think he’s being asking about it if he wasn’t.

And yes, there is risk. That is the nature of business. Yes, he may very well lose money. But, it’s a better option than making a long term commitment to a building lease etc.

I understand the theory of pricing based on demand but you still need to know your costs before you start. I didn’t suggest a particular markup, only that he needs to know his costs before he can set a price.

You don’t need to be an expert to start or run a business. You DO need to be able to coordinate and organize the business with people who do know. Entrepreneurs don’t just do what they know; they know what to do to get things done.

After all that, taking over the family business might be a better option!

All in my humble opinion.

[Paul]

Paul,

I totally agree with both your posts. Having your own business could be venturing out with something risky or it could be taking over your family business. Both are valid ways to be a small business person.

I agree.

In Chelle's case he may have the best of both worlds. He can take over the family business and then expand into a catering type of business. It's a short hop from the family business to other food related businesses. Also, the family business would give him a base from which to operate.

[huggytree]

I don't see why anyone would mentor me if they knew my goal because then it would mean competition for them I'm the future. I've just always wanted to own my own business and be proud of what I started like a lot of my family and it sucks that I'm not knowing what to so or what I would be good at. Guess I have to keep figuring out what it is.

I found a mentor...he was a competitor and gave me a 6 hour class on how to run my business...he even gave me some paper work that saved me 100+ hours or research....walked me through his shop.....answered any questions I had

his reason was that he didn't want me to be a price cutter..he wanted me to charge full price.....he felt he could compete if we all charged correct pricing and found most new guys undercut the market to get their foot in the door....I would not teach new business owners as he did...I don't think it was a smart idea for him....but it sure helped me

you may find a mentor....its really the best way to get started....I think most people don't find mentors though

[huggytree]

if someone is offering you a business id take it....your parents will be your mentors

[Paul]

The Thai restaurant is next door which my dad started and gave to his brother to run so he could have a job. He must've done something right because it's been winning awards. But yeah, we depend on each other for business in a way. I would take it over if I didn't have issues with not feeling proud of myself for starting something from ground up...I mean, would you feel accomplished and proud if a business was handed over to you??

Business ain't like it used to be. I mean we do good but not as great as before.. but we used to be the only spot with an Asian grocery/restaurant and now over the years there are tons of them.

Another thing is, my dad's two other brothers kind of have a place in the store where they just take up space. They're never there and don't work hard and I can't kick them out lol Meaning my uncle is kinda lazy...scratch that really lazy.

I have to recommend reading, “Acres of Diamonds” and “Horse Sense”. “Acres of Diamonds” talks about finding opportunities right in your own back yard, and “Horse Sense” talks about “finding a horse to ride” to be successful.

In your case, I think the diamonds and the horse are your family business.

I think you may be foolishly prideful and misguided in your dismissal of your family’s business.

Unless you’re “fulfillment” comes from the actual personal work you do such as an artist, tradesman or professional you really do need to “find a horse to ride”. To be a little more corny, it sounds like you are right in the middle of an Acre of Diamonds and the horse is right in front of you waiting to be mounted.

With family businesses of an Asian grocery and an Asian restaurant (right next door) and your thoughts of a catering hall business in an Asian community….well jeesh…can it get any more obvious?

Take that business and run with it! Stop pondering and start doing.

The pride and fulfillment will come from being successful.

Acres of Diamonds - Earl Nightingale - YouTube (http://www.youtube.com/watch?v=2MPGbwdqCC4)

Acres of Diamonds - Acres of Diamonds - Discover Your Own Acres of Diamonds (http://www.acresofdiamonds.net) Horse Sense: The Key to Success Is Finding a Horse to Ride: Al Ries, Jack Trout: 9780070527355: Amazon.com: Books (http://www.amazon.com/Horse-Sense-Success-Finding-Ride/dp/0070527350)

[Jim Briggs]

Starting a business is a very personal decision and its hard to give good advice without knowing someone--a bit. In his book, Drilling for Gold (http://www.amazon.com/books/dp/0471128902), John Warrilow, based on empirical data he collected from interviews and focus groups, defined three kinds of three kinds of entrepreneurs: mountain climbers, freedom fighters, and craftspeople.

Mountain climbers are motivated by growth and achievement.
Freedom fighters are motivated by independence. Owning a business is the ultimate way to achieve independence.
Craftpeople just want to practice their craft and often don't even think of or like to think of themselves as business people.
And you can imagine combinations: a rock star could be a mix of mountain climber and craftperson.

All of these paths are legitimate forms of entrepreneurship.

If you're a mountain climber, the last thing you want to hear is someone tell you to put in your time and take the easiest path. Please! If you're a freedom fighter, then what's most important is what can give you that independence (more pragmatic). If your a craftsman, you're more interested in doing your thing ("spare me the biz talk; I won't even be on this forum").

I think you have to ask WHY. Why do I want to start a business? Then ask yourself why a couple more times to try to get to the root motivation (called the five whys BTW brought to you courtesy of Toyota).

To tell you the truth, chelle, I might be offended by some of the reponses to your post. But then again, I'm a mountain climber which is a blessing and a curse.

What's your deepest motivation to start up? Which path would best satisfy that motive? Could owning your parent's business satisfy what drives you? It's less risky. Or do you want/need something more? Also important: what are you willing to commit to and pay a price for? What's going to make you happy in your career (ultimately most important)? Be hones with your self. Mountain climber often pay a BIG price--don't underestimate that, but you have to be true to who you are.

It's OK to stay hungry, stay foolish (Steve Jobs), or be well-fed, be pragmatic. But above all, be true to yourself.

(this is the plan before the plan before the plan)


P.S. Having said all that, let me add/tweek/tinker with my statement by saying that taking over your parent's business is not inconsistent with growth and achievement.

[davidb3069]

You need passion in what you do and you need to know what you're doing (for a number of reasons, including licensing or liability). Stick with things you know and love or find a business partner that you can work with.