Catering

Being Savvy About Contracts (August, 2004)

As the old saying goes, “a verbal agreement is a prescription to disaster.” That’s why contracts are so important – especially when it comes to your wedding and making sure every last detail and promise is down in writing. But for many people, reading and executing a contract is a new experience.

It’s important to know the ins and outs of the wedding contract lingo so that you’re not caught by surprise. In the first of a series, PrescottWeddings.com is going to share insights on how to review, read, and negotiate contracts – that can save you money and avoid headaches down the road.

Since a large part of your budget (50%) is usually spent on the reception, this month’s issue is going to focus on catering/banquet contracts.

Inclusive/Exclusive



One of the first things you should notice on the menu is whether the pricing is “inclusive” or “exclusive”. This makes a world of difference, especially for brides on a budget. “Inclusive” means that gratuities and taxes have already been calculated in the price; “exclusive” means that gratuities and taxes are still to be added. As many catering contracts arbitrarily establish an 18% gratuity charge, and with Arizona state taxes at 8%, that’s a whopping 26% extra to the cost of the meal.

To simplify the example, let’s say you’re looking at a cost of $24.95 per person, exclusive. The caterer will add 18% gratuity ($4.49) and then assess the 8% tax on the meal and gratuity ($2.36). That’s an additional $6.85, or a true cost of $31.80 per person, inclusive. When you’re looking at a reception for 100 guests, that’s a difference of $685 ($2,495 vs. $3,180). PrescottWeddings.com tip? Make sure all menu prices are quoted “inclusive”.

Caps/Ceilings



Here’s another way that your budget can skyrocket out of control. Many times you enter into the catering/banquet contract 6-9 months in advance. In larger cities and/or popular reception sites, it’s not uncommon to sign the contract 10-12 months before the big day. The problem is, the further away your wedding date is when you sign the contract, the more likely it is that the catering company will raise its prices. That’s because costs go up, the company needs its profit margin, and you’re the one stuck paying the bill.

Negotiate a cap or ceiling on the cost of meal. The differences between the two are minor for your purposes. A “cap” means that the increased cost has been limited to a certain percentage or dollar amount per guest. A “ceiling” means that no matter what, the cost will not exceed a certain price.

One couple we know didn’t do this and learned the hard way. Months after signing the catering contract but less than week before the wedding day, the price of beef soared. As the couple had provided guests menu choices on the RSVP card, the cost of the banquet increased an additional 24%. Ouch!

Making sure that there is a cap or ceiling on the cost of the meal is just smart planning – and ensures you remain on budget.

Liquor/Beverages

Many times your bartender and bar costs are part of the catering contract. The cost for soft drinks, coffee and tea are either included in the cost of the meal or there’s a small charge for the service. Regardless, the cost is minimal when compared to the cost of alcohol. There are a number of things to consider when liquor is being served.

First and foremost, learn about liability coverage. Serving alcohol carries with it certain responsibilities and you don’t want to be held personally liable should one of your guests over-imbibe. (It does happen.) If your reception is taking place in a well-known or respected establishment, chances are the necessary insurance is already in place. If your event is being catered outdoors, at a private residence, or in a public arena (i.e. park, art gallery, museum), you might wish to consider a special one-day only event policy. Your insurance agent should be able to provide you with one but be prepared for the small sticker shock. The cost for the special 24-hour policy ranges between $250 – $500. Overall, it’s a small price to pay for your peace of mind (and simultaneously protect your pocketbook).

If you are having a bar, negotiate bartending fees being waived when the dollar amount of liquor served exceeds a certain sum. If wine or champagne is being served, the cost is generally calculated on the number of bottles that are opened or uncorked. Carefully determine the number of bottles you believe you will need (at 4 1/2 glasses per bottle). Add a few extra bottles for contingency sake if you like. Just make sure the contract states that further approval is required should the number of bottles exceed this amount. A mad un-corker turned loose at a wedding reception can wreck havoc to your bar tab.

Just one last hint. If the number of bottles to be served is unlimited, have someone you trust count the number of bottles the caterer brings in prior to the reception. One unscrupulous caterer we’re aware of tried to bring out empty bottles of wine after the reception saying that the guests had drunk them all. The ruse didn’t work – the host and hostess were pretty savvy – but what if it had? And what if it was to you?



Deposits/Cancellations/Postponements



Most catering contracts require a non-refundable deposit. Before signing on the dotted line, make sure you know what monies are refundable and not. No matter how firm your plans are, discuss the possibility of a cancellation or postponement. Life happens and there are family emergencies or situations that require a wedding to be delayed or cancelled completely. Many caterers are amenable to applying the deposit monies paid to another wedding date but rarely do they refund the money in its entirety if your wedding is cancelled. Know the whens and ifs – just in case.