Age Old Question: Prices Over The Phone or Not?

Each and every salesperson is faced with this decision each and every day of their selling career. If we polled caterers, we would find that many of the salespeople believe that giving prices over the phone is perfectly o.k, while others would tell us that it’s crazy to give your prices to somebody who’s not sitting in front of you. So, should we give pricing information over the phone? What do you do when you have a caller ask you the questions below:

“Yes, I’m calling to find out how much you charge for a wedding of 200 people?”

or

“”What are your prices?”

From the “never give prices over the phone” point of view, the decision would be made to try to set an appointment or to tease the individual calling.

“It’s really difficult for me to give you prices without knowing exactly what you’re looking for. All of our menus are customized to fit most budgets. As a caterer we do a wide variety of menus and themes, so it is best not of project price till we hear exactly what you wish.”

From the “sell over the phone” point of view, the decision would be made to give the caller an understanding of what price range they might fall into.

“With respect to price, I can only give you an example because I don’t know the particulars of your event. We have wonderful wedding packages that sell for $78 per guest and some that sell for $129 per guest. The main difference between the two is the type of entrée our customers select and the day of the week they wish to have their catering.”

Are you starting to see the dilemma? It’s really a personal decision by each and every salesperson as to whether they give price information over the phone. Of course, it could also be a management decision. I wish to suggest that in either case, it’s probably better not to treat each and every caller in the same manner. In other words, it’s best not to have a hard and fast rule about giving , or not giving, prices over the phone.

Let’s take a moment and think about this from the caller’s point of view. How will they respond to either of your approaches? Can we raise their curiosity, or will it just make them angry? Think about this... you walk into a jewelry store and begin to look at some watches in the showcases. Do you look for the price tags? When you look at a restaurant menu in a new restaurant do you look at the prices?

Most of us would certainly look. We want to know about prices. We wish to know the type of store, or restaurant, we’re in. We don’t want to be embarrassed by being in the wrong buying situation. We’re not suggesting that having a policy of giving prices out over the phone will get you more sales. I’m suggesting that in certain cases, with certain buyers, it is best to give them an idea of what type of “store” they’re in.

On the other hand, I can also share with you, what most caterers have found that when they give pricing information over the phone, they tend to give ranges of price or price examples. In this way, they get the best of both worlds!

NOTE: This is a great topic to discuss with your team!

Create Stealth Closings

Many caterers close off certain dates with the intention of giving staff a breather—and simultaneously cutting back on other costs. IN other words, prop sects are told that the date they are seeking is closed. A few days, very often a Friday or Monday, plus a weekend, are declared a “stealth” or invisible closing. No bookings for those dates are taken. Everyone in the company knows that a mini-break is on the books to increase the staff’s quality of life. This time can also used for outside contractors to come into the facility to deep clean or do other maintenance, repair or upkeep.

Remember: there are variable costs accumulating whenever your company is open. Everything from cost of staff consumables while at work to lights and phone calls. Every little bit of savings helps.

Thoughts On "Unwise" Sales

Note: What I''m about to write about has always been a "touchy" subject for my audiences. So, just take it for what it is and don't read too much into it. It does not represents a problem that ALL caterers have. That being said, this topic is central in creating proper profit in a catering business.

Unwise sale? How can any sale be unwise? Sometimes it’s important to keep my staff working? We’re here anyway... so why not take the smaller orders?

No sale is unwise if you want to take it. After all it is your business and you have the right to do with it what you want. The question is why you’re taking a particular order. So, once again I ask the question...What is an unwise sale?

An unwise sale is one that causes you loss of profit or lessens the quality of your life. An interesting answer... don’t you think? How can a sale lose profit? Simple... it is either not priced correctly, or it is too small, or it’s the wrong order for the flow of a particular catering day.

An unwise sale is created when the price is incorrect and/or the number of guests are too few.To put this another way, the problem rests with the price being too low and the number of guests also being too few. A $7.00 box lunch for 9 guests is probably an unwise sale. However, the same $7.00 box lunch for 45 guests is a better sale.

On the other hand, a $1.22 per person charge for a day care meal for 100 is probably unwise even if it is a seven day a week order. However, a $1.22 for 800 per day is a great sale. A caterer’s quality of life is also affected by the unwise sale. Imagine coming in on a Sunday for an order that generated only $63. You need to understand that we’re taking a “catering” view in this education. Other forms of foodservice, like restaurants, might find it well to take any order that comes along. Catering, however, is different.

Many have learned that a great day can become a bad day simply by taking that one order that turns out to be the “order from hell”! So, it is important to have some kind of policy as to which are unwise orders.

Another reason a sale becomes unwise deals with the product line mix on a particular day. When a caterer has three weddings leaving their kitchen on a busy Saturday, it is unwise to also have a drop-off cold buffet for 25 on the same day. The Saturday cold buffet, on a busy full-service day, will create real, or false, problems for the culinary and delivery staff. When all attention should be focused on the importance of high volume orders, the kitchen staff is taking time to create the smaller cold buffet. By the way, the host that gets the drop off cold buffet will probably call you back to tell you to bring over some additional mustard because they don’t think they have enough!

For those caterers who still say “An order is an order” or “A sale is a sale” or “A dollar is a dollar” I can only say... that is not necessarily true.

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New Research That You Need To Know About

Check these stories out - very important info for caterers!


http://www.sacbee.com/2011/09/13/3906713/office-catering-opportunities.html


http://www.nrn.com/article/office-based-breakfast-and-dinner-catering-growing

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It's Normal For Buyers Not To Buy "Today"

This article has moved to the new CateringGuru.com! Click here to read the updated article!

A Unique 911 Story From Tasty Catering

The email below was sent from Rich Henquinet, the Human Resources Manager of Tasty Catering in Chicago, to Larry Walters, one of the principles of Tasty Catering. I asked for permission to publish this since it is such a learning experience in many obvious ways and some deep thinking ways.

Rich Henquinet

Rich delivered the catering order mentioned in his email on September 11 to a group of Marines - here is the email sent by Rich:


While delivering the US Marines order of hot food for 140 yesterday, I opened the first of three pans of mashed potatoes. I was struck by what I saw - the US Flag! I stopped...and swallowed hard....as goose bumps engulfed my body. I opened the two other pans and they were decorated as well. I could not believe my eyes...and immediately started to try to guess who did this. What an awesome act of Patriotism on Patriot Day*. Two Marines wandered in and asked what was for lunch and I told them "chicken" as I removed the mashed potatoes lid to show them the flag. They both paused and acknowledged the thoughtfulness of the decoration. They mentioned it to a few Marines standing about 40 feet away who then walked over and asked to see it. They too acknowledged the decoration...and very much appreciated it. After the presentation was set up the Sergeant in charge came in to sign the delivery ticket. I showed it to him. He paused as he admired it....and looked me straight in the eyes and thanked me for the decoration. I told him I'd pass his "Thank you" on to the chef who decorated it. This act of kindness WOW'ed the Marines on this truly special day. I felt 10 feet tall as I left the building.  The photo, taken with my cell phone, is not the best of quality. Larry, please pass on my most sincere regards to the chef responsible for this. He or she made us look incredibly good. This is another example of why Tasty Catering is the leader in corporate catering.


Here is the photo Rich took with his cell phone of the mashed potatoes:

Not a great photo, but you can see the FLAG!

Here is the Tasty Catering Chef Ricardo Gervacio, Hot Food Prep Line manager, who took it upon himself to do the American Flag for the Marines.

Chef Richie Gervacio
Great Work Richie!

Discussion Topic For Your Next Sales Meeting #5

Below is a very advanced selling script that should be discussed before adopting for use in your company. It is bold to say the very least. I actually heard this script used by a power caterer in Washington, DC. I was amazed on how much it endeared the shopper to the salesperson. I believe that the shopper was just as surprised as I was when the salesperson used it. In essence, the salesperson was saying to the shopper that the most important thing was for the shopper to have a "successful" catered event which was more important than just making a sale. Please discuss this with each other.

“Mr. & Mrs, Jones, if after you think about it for a while, and you decide to use another caterer than us, don’t hesitate to call us for an opinion on what the other caterer is offering. Also, if you like one of our menu items, and the other caterer doesn’t have the recipe, please have them call me and I’ll gladly give it to them. I just want your party to be the best it can be!”

Ten Actions For Successful Sales!

1. Be a giver... not a taker!

2. Be able to laugh at yourself.

3. Make buyers feel comfortable.

4. Continually search for new business.

5. Remain positive and optimistic.

6. Have total confidence in yourself.

7. Always stay on the buyer’s side.

8. Practice your presentation skills.

9. Develop mentors to learn from.

10. Be a team player.

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My Tips On Finding A Great Accountant

1. Accountants are very busy people. However, they need to be able to give a caterer more than just a little time. Shop for your accountant. If they are reluctant to come and make a sales call to you to “see” what you do before you hire them, think twice.

2. Unfortunately, most accountants don’t really understand what caterers do. Most accountants only know accounting procedures for restaurants, which tends to get them into trouble with caterers.

3. The single biggest area of concern deals with the fact that, unlike restaurants, caterers have prices and menus that are always different from those sold yesterday. They are for different size groups with different amounts being sent. These variablesoften “throw” the accountant.

4. Caterers tend to get into trouble with taxes especially payroll taxes. Therefore, it would be wise to select an accountant that has some tax expertise. Some caterers search for a CPA that is also a JD – Lawyer. It’s a plus if they have IRS work experience.

5. Most accountants will want the caterer to use a computer program to manage their books. This is a good thing for both parties.

Scripts For High Price Objections

As we all know, prospects often directly “attack” the fairness of a caterer’s pricing – “You’re prices seem higher than other caterers.” Often these price objections are harsh and aggressive. Below are some simple scripts that just might help a salesperson “explain” their prices to the prospect.

“Yes, Ms. Weaver, we realize that we charge more than many caterers in town, but when we started ABC Catering, we quickly realized that we could charge less by giving less, as some other caterers have chosen to do. Or, we could charge a realistic and fair price that would allow us to maintain a catering business that offers only the finest quality in order not to embarrass our clients, their guests or ourselves. So, Ms. Weaver, I’m sure that you want only the best for your friends, don’t you?”

“When a caterer doesn’t have any track record, they usually offer lower prices, which results in lower levels of experience and quality that foster much more risk for the host.”

“Many customers think that all caterers are the same, just as the same model of a car is the same, no matter what dealer you buy it from. But you’re not buying a car when you buy catering. Let me explain: If you can decide on a particular car model that you want and then go to different car dealers and try to get the best price, that’s great; a Lexus is a Lexus. But when you call and get different prices from different caterers for the same menu, you are buying qualities that you can’t examine by “kicking the tires,” such as experience, track record, quality of suppliers, cleanliness, staff and the overall investment in the profession. Spending $500 less on a caterer could become one of your worst nightmares, like expecting to get a Lexus but ending up with a Camry.”

 “We hear that from many people, and it’s an honest comment. But because we charge a little more, we are able to put a lot more into the order. So, I think the extra money is worth your peace of mind because you won’t have to worry about the success of the party. What do you think?”

“As you know, as with most things that you buy, you get what you pay for.”

“Since you brought up XYZ Catering, let me share with you some of the major and minor differences between the two of us …”

“Yes, XYZ is somewhat less expensive than we are …but look over this list of clients who have switched to us from XYZ because of what they discovered after they tried us just once.”

Discuss these scripts, make them better or discard them – but, please do something to prepare your response to high price objections.

My Very Cool Additional Phrases for Proposal/Bids

These are some of my favorite phrases to use in bid/proposals. You might add one or more of the following phrases to your proposals:

a) “Your price of $85 per guest is guaranteed for forty-five (45) days until October 3. After this date, a review needs to be done to assess any increases in cost.”

b) “When you call us, please use this special number, 555-5555, which will place you with my associate, Gregg Jones.”

c) “Gratuities are not required, but are graciously accepted by the staff.”

d) “Most important, we assume all responsibilities for planning and coordinating the total flow of your event.”

e) “All of our ingredients are fresh. All of our portions are generous and you may be assured of ample quantities for your invited guests.”

f) “We take pride in understanding and anticipating the special needs of our clients. We make them partners with us in creating memorable and treasured events!”

g) “The menu enclosed has been customized for you and reflects our earlier discussions. However, I will gladly make any adjustments you wish. The menu and services have been priced according to the number of guests you are presently estimating.”

h) “All other charges for equipment rentals, flowers, music, etc. will be on your final invoice or billed directly by our affiliate companies. Please note that we accept major credit cards for payments of deposits or invoices.”

i) “The staff will leave your event at 1 A.M. and will cost $685 per hour for the eight hours of service. In addition, a 12 percent Social Security and Unemployment Tax fee and a $20 gratuity will be charged.”

j) “Enclosed, please find a statement of insurance from our insurance carrier. We want you to know that all ABC Catering staff working at your event are legal employees and not independent contractor casual labor. This means that, since they are covered by Workmen’s Compensation, you are protected from possible claims by staff for any injuries that might happen while at your event.”

k) “Once you have booked with us, you will receive unlimited phone assistance to confirm and reconfirm each and every detail.”

l) “Over the phone yesterday, you mentioned the need for keeping costs down at your event. Bob, you’re not alone in your wish. Most of our clients are voicing the same concern for value and lower-cost impact ideas from us.”

m) “Just in case you need me before or after regular business hours, my cell number is 555- 5555 and my home number is 555-5551. My children are up at 6 A.M. each morning . . . feel free to call!”

n) “One reason for our company’s success is that our planning department has the total support of our culinary team.”

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My Getting Money From Vendors Concept

Below is a real memo I’ve had some of my consulting clients use to secure marketing money from the people they send money to for goods and services. You send thousands of dollars to your seafood distributor, etc. Why shouldn’t they help you in your marketing? The people and locations mentioned in the memo below are fictitious. You will either like this idea or not. I personally hope you like it and give it a try!

Date:

MEMO

From: Jim Smith

To: Bob Jones

I really need your help... but first let me tell you once again what a super job you and your crew are doing for us! I receive nothing but raves from my clients and their guests about your products.

Bob, I’ve arranged to do some marketing during the months of November and December targeted at getting more business during our slower season of January through March. The total budget is $4,800 for some ads in the City Light magazine and a direct mail letter to 3,000 people in the Plum Grove area. Since we both will gain from the success of this marketing, I’m asking my suppliers for their financial support in this marketing program.

Please consider investing 10%, or $480, in our marketing efforts. You may send us a check directly, or if it’s better for you, you can make the check out to one of the companies that I need to pay for the marketing i.e. postage, printing ad design etc. In either case, please call us before September 25 with your decision. You may ask for me or Margaret.

Thanks for your consideration!

P.S. Why don’t we meet for lunch!

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Planning For A Marketing Promotion

1. Decide what promotion fits in with your overall marketing goals.

2. Concentrate on increasing the most profitable parts of your business.

3. Write down what you expect this promotion to bring you.

4 . (a) Make sure you know what Unique Selling Propositions you will be marketing to.

     (b) Determine what you are going to offer and to whom.

5. Create your theme, point of interest, gimmick, attention getter or whatever you wish to call it!

6. Figure how you can get your entire staff involved in the promotion.

7. Test your ideas with your various mentors.

8. Put a budget together to look at the numbers. Remember, if a catering business is earning 20% profit on every dollar sold, then you get back $20.00 for every $100.00 of stuff you sell. So, if a promotion is figured to cost you $1,000.00 of your hard earned money, then you will need $5,000.00 in sales from the promotion just to break even!

9. Create a realistic timetable and assign tasks to create the promotion for yourself and the staff.

10. Put the promotion aside for a few days. Let it roll around in your head. If it still makes good sense and nobody is able to critique it... put it in motion.

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Start Marketing Holiday Events Now!

OK - it's after Labor Day - caterers shouldn't wear any "white" and must start working on holiday sales.

A Win-Win Flood Donation

Check this out -

http://blog.timesunion.com/tablehopping/25158/classe-catering-cooking-picnic-for-flood-ravaged-windham/