REWARDS

TWO TYPES OF REWARDS

Intrinsic Rewards
Are those that
the caterer
experiences as
a result of the
successful
implementatio
n and
execution of
an event.
Extrinsic Rewards
Are those that
the caterer
experiences
outside of the
event itself.
RISK MANAGEMENT
The task of identifying
potential hazards and
creating standard
operating procedures to
prevent their occurrence.
EXAMPLE SCENARIOS
Crisis Management Team
Is a group of homogeneous managers
and employees who can be quickly
summoned to deal with a fire.
A catering management team cannot
prevent the crisis, the team can quickly
attack the problem using structured and
pretested emergency plan.
INSURANCE!
A catering management team can help resolve
the immediate needs of the situation.
However, a well designed Insurance Program
will help protect the long-term interest of the
caterer.
When establishing the right
insurance program for the
organization, a caterer must..
1. Identify and analyze the exposures or
potential cause of loss.
2. Know the options to address the exposures,
and choose the best alternative for the
organization.
3. Monitor the insurance program and make
incremental adjustments to the overall
package.
ADDRESSING RISK
- A caterer may avoid or reduce or
transfer risk.
- The purpose of a catering safety
management team is to continuously
monitor the environment to identify and
correct potential risks, ensuring the
proper safety of the employees and the
guests.


- The team should first to create a plan
to describe the format of an
inspection.
- The team must structure a plan to
include a detailed format of an
inspection, the frequency of
inspections, and who is responsible
and accountable for its execution.


- A checklist to inspect all areas in a
catering operation is organized.

In case of emergency:
1. Keep calm
2. Do not attempt a rescue if it could result in
an injury.
3. Check for fire (heat), smoke, exposed
electrical lines and chemicals.
4. Dial 911. Stay on the phone with 911
operator until told to do otherwise.
5. Know the location, phone number and
your name.
Reducing Risk
- Risk can also be reduced. A caterer can
have a sprinkler system or a central alarm
system to reduce the risk of fire.
- A caterer can also transfer the risk of loss
by renting a facility instead of owning the
building.
- A caterer can also reduce risk by the
implementation of a safety program.
provi des fi nanci al
rei mbursement to the
owner of a structure
and i ts contents, i n the
event of damage
to have the bui l di ng &
contents covered on a
replacement cost (RC)
basi s
what you woul d pay
for the i tem at
todays cost
to cover on an actual
cash value (ACV) basi s
what you woul d pay
for a si mi l ar i tem at
todays cost mi nus
depreci ati on
ACV= RC - DEP
C A U S E S O F
L O S S
BAS I C BROAD
S PE CI AL
C A U S E S O F
L O S S
BAS I C BROAD
S PE CI AL
named peri l s onl y
provi de coverage
for l oss from onl y the
parti cul ar causes
C A U S E S O F
L O S S
BAS I C BROAD
S PE CI AL
named peri l s forms
provi de coverage
for l oss from onl y the
parti cul ar causes
al l ri sks form
coverages l oss
from any cause
broadest
protects the caterer
agai nst cl ai ms ari si ng
from the ownershi p,
mai ntenance, or use of
the premi se and of the
caterers operati ons
protects the caterer agai nst cl ai ms
al l egi ng fal se arrest, l i bel , sl ander, and
fal se adverti si ng
provi des coverage for the
caterers l egal l i abi l i ty ari si ng
from fi re damage to structures
rented by the caterer
rei mburses al l reasonabl e
medi cal expenses i ncurred by
anyone, except the caterer or
i ts empl oyees, as a resul t of an
acci dent wi thout regard for
the caterers l i abi l i ty
I N S U R A N C E
I N S U R A N C E
protects the caterer from l i abi l i ty i mputed
to hi m by the acti ons of an empl oyee
covers busi nesses agai nst cl ai ms by
workers that thei r l egal ri ghts as
empl oyees of the company have
been vi ol ated
SELECTION OF
INSURANCE
The most desirable program for a caterer is one that
addresses all possible causes of loss with a
combination of insurance, safety practices, and
sensible transfers of risk at the least expense to the
caterer. Before a caterer can purchase the policy,
he/she must design the best program to provide the
maximum coverage for the business.
SELECTION OF INSURANCE
1. What is required by the law?
2. What is required by a bank or lienholder for financed property or vehicles?
3. What must be covered to ensure survival in the event of a claim or loss?

A caterer must also be aware of THROW-INS. These are extra coverages at
no extra cost to the caterer. Salespeople/PRODUCERS, will point out these
throw-ins to a caterer to make their proposals more attractive than their
competitors policy.
INSURANCE
EXPENSE
A caterer trying to balance adequate coverage
and the cost of insurance is considered to be
making, at best, an educated guess.
INSURANCE EXPENSE:
BASIC TRUTHS
Higher deductibles, higher coinsurance clauses, low
losses, if any, and competitive quotes will keep the cost of
insurance down.
A caterer has the right coverage to fit the needs of the
business at a competitive rate.
The loss control services being provided should also be
clearly understood.
The relationship between the caterer and the agent must
be built on trust.
The caterer should request credentials and expect honest
and clear explanations.
INSURANCE CHART
Risk
1. Building




2. Contents




Non-Insurance
Rent instead of own
Install central alarm
system
Install sprinklers
Use fire resistive Material

Separate flammables
Safe storage
Have alternate supplier
Insurance
Insure at replacement or
actual cash value if no
intention to rebuild.
Special cause of loss
form


Insure at replacement
cost.
Special cause of loss
form.
INSURANCE CHART
Risk
3. Loss of Income


4. Boiler and Machinery


5. Liability
Non-Insurance
Cross Agreement

Boiler inspections
Back-up power supply
Surge protection

Keep certificates of
insurance on file for
subcontractors and use
hold-harmless
agreements in contracts
Insurance
Business income
coverage.
Include extra expense
and consider ordinary
payroll.

Some packages include
this to cover cooling
equipment, electric
equipment

Coverage to meet a
caterers organizations
needs
Protect company and
personal assets
INSURANCE CHART
Risk
6. Automobile



7. Workers
Compensation


8. Umbrella



Non-Insurance
Drug testing
Check MVR and conduct
safety meetings

Safety committee (some
states require insurers to
give discounts)
Drug free workplace

Incorporate to protect
personal assets
Insurance
Liability, physical damage, medical
Hired and non- owned liability is a
must, even if the organization does
not own a vehicle.

Required by law?
A caterer may need employers
liability

Sits over top of a caterers liability
Very broad coverage to protect
against large awards

CONTRACTS
A Binding agreement between two or more
parties. May also be defined as an agreement
creating an obligation.
CONTRACTS
A caterer does not need to have an elaborate contract, but the contract
does need to spell out some important details.
It is important for a caterer to understand some basic business
activities that involve contracts.
The caterer is obligated to provide the food and service implied or
detailed while the ENGAGER or client, is obligated to pay for food and
specific services, if satisfactory.
Every job a caterer agrees to execute, regardless of the party, requires
a contract. One exception where no binding agreement is required, is
when the caterer supplies catering as a gift.
A well-written contract will prohibit additional services demanded by the
client to be provided by the caterer during the implementation stages of
the function.


IT IS AN ABSOLUTE MUST FOR A CATERER TO USE A
CONTRACT. WITHOUT CONTRACTS, CATERERS WOULD
FIND THEMSELVES WITHOUT A LEG TO STAND ON
WHEN ATTEMPTING TO COLLECT PAYMENT FOR
SERVICES AND PRODUCT RENDERED. WE BUILD
ALMOST EVERYTHING INTO OUR CONTRACTS: WHEN
GUARANTEES CAN BE CHANGED, COST OF AV,
MINIMUM FOOD AND BEVERAGES PER NIGHT, COST OF
LAST MINUTE CHANGES, BAR MINIMUMS, ETC.
WITHOUT A CONTRACT, THE CATERER WOULD
SUBJECT TO THE HONESTY AND MEMORY OF THE
CLIENT.
Jeremy Engle, Banquet Manager
Contracts are also valuable business assets for the caterer. It can
be used as collateral to borrow money to meet short-term cash
needs and are considered tangible assets in the sale of a catering
business.
The exact number of people who will be served
must be stipulated.
The exact menu to be served.
The type of service to be provided at the event
by the caterer and staff.
The exact amount of time for each activity.
The exact price.
Payment policy.
Deposit and Refund Policy.
Cancellation and Refund Policy.
Method for Counting Guests.

a multi-purpose catering management tool
used internally to communicate the specific
details for execution of a catering event to
the appropriate personnel.

often used by a hotel catering department to
coordinate each catering event through
communicating to the appropriate personnel
or departments what participation is
needed.