Catering pricing: costs, margin, tax and deposits
A catering quote is a total for the whole event. Getting it right means being honest about the costs you include, and clear about what a margin is measured against.
Last updated 2026-09-21. Every figure below is a fictional illustration. This guide is a method, not tax, legal or accounting advice.
1. Scale the food to the guest count
Each guest can receive one portion of several dishes, so scale each dish on its own.
For 50 guests, one serving each, and a 10% food buffer, you prepare 55 servings. A buffer is extra food only. It does not add billable guests, staff, tax or packaging.
If a recipe makes 20 servings and costs $120 per batch, then 55 servings is 2.75 batches ($330) when scaled proportionally, or 3 whole batches ($360, making 60 servings) when you can only cook full batches. Which is right depends on how you cook.
2. Add the other costs you will really incur
- Packaging and consumables: quantity × unit cost.
- Labor: people × hours per person × hourly cost to you. If payroll taxes, workers’ compensation or similar costs apply to you, include them in that hourly figure yourself.
- Rentals, transport, venue costs and miscellaneous: enter each as an amount.
- Overhead: a share of fixed costs you choose to allocate. Leaving it at $0 means none has been allocated, not that your business has none.
- Contingency: a percentage cushion applied to the costs above. It is a financial allowance, distinct from the food buffer.
3. Margin and markup are not the same
Margin is measured against the price. Markup is measured against the cost.
Costs of $1,000 with a 25% markup gives a price of $1,250. The margin on that price is $250 ÷ $1,250 = 20%, not 25%.
To reach a 25% margin instead, the price is $1,000 ÷ (1 − 0.25) = $1,333.33.
Mixing them up is one of the easiest ways to underprice a job. This calculator solves for margin and shows markup separately, labeled.
4. Payment fees and tax
Card and payment processors usually charge a percentage of what the customer pays, which includes tax. In this calculator the fee is applied to the full customer total. Sales tax is collected on behalf of the tax authority; it is not part of your revenue or contribution. Whether a given item is taxable, and at what rate, depends on where you operate. Check with your local tax authority or an accountant. This calculator supports one simple rate on the whole quote.
Worked example (fictional)
Food $900, packaging $40, labor 2 people × 4 hours × $30 = $240, travel $60, overhead $60. Total cost: $1,300.
Target margin 25%, payment fee 3%, tax 0%: $1,300 ÷ (1 − 0.25 − 0.03) = $1,805.555…, rounded up to $1,805.56.
Fee = 3% of $1,805.56 = $54.17. Contribution = $1,805.56 − $1,300 − $54.17 = $451.39, which is 25.0% of the price.
5. Deposits
A deposit splits when the customer pays; it does not change how much they pay. With a $2,000 quote and 8% tax the customer total is $2,160, and a 25% deposit is $540, leaving a $1,620 balance. If you are collecting a deposit, make sure your terms say what happens if the event is cancelled. That is a business and legal question this calculator does not answer.
6. Estimate, then quote
The customer-facing printout from the calculator is labeled “Estimate.” It is not a contract or a tax invoice, and it leaves out your ingredient prices, labor rates and margin. Review every input, and consider anything the calculator does not model (service charges, gratuity, discounts, flat fees), before you send a number to a customer.
Build an estimate in the catering calculator
Related: recipe costing and cooking yield.