Looking for a catering and ballroom rental business plan? You're in the right place.
A catering company with its own hall earns twice from one event: once for the room and once for the food. It also carries a lease, a kitchen build-out and four quiet months before the first guest arrives. A lender will ask how many dates the room can sell, what deposits do to cash, and what happens in January when nobody books a wedding. A generic template answers none of that.
In this article we walk through a complete sample plan for a catering and ballroom rental business in Salt Lake City, Utah, section by section, ending on five years of financials with the first year shown month by month.
Here is what you will take away:
- The executive summary: see how to describe a business with two revenue engines, a room and a kitchen, on one page
- The event calendar: learn how weddings, galas, holiday parties and community events fill a hall through the year, and where the quiet months fall
- The venue economics: find out how a rental fee with almost no direct cost changes what a catering margin has to carry
- The booking and deposit schedule: see how retainers, balances and 15-day invoices turn into cash, and why held deposits are kept out of the cash line
- The start-up budget: understand what a leased ballroom, a commercial kitchen and the first four pre-opening months cost, and how equity and a term loan split it
- The five-year profit, cash flow and balance sheet: follow each hire, price rise and distribution through to the numbers
- The slow-booking case: have an answer ready when a lender asks what happens if dates sell 20% short
If you are planning an event venue with a kitchen, read this before you write your own. The business is fictional, so keep what fits your market and change the rest.
In this plan
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Crest Mead in Brief
Crest Mead is a catering company with its own event hall in Salt Lake City, Utah. It leases a 6,200 square foot single-story building and converts it into a ballroom that seats up to 225 guests at round tables, a commercial kitchen and two preparation suites, and it opens in May 2027. Four lines earn the money: ballroom rental fees, in-house catering for events held in the hall, coordination, AV and decor add-ons, and off-site catering. Joanna Hargrove, the executive chef, and Elias Brandvold, the venue and sales director, own the company with an outside investor who holds a minority share.
The company needs $845,000: $565,000 of equity ($200,000 from Joanna, $115,000 from Elias and $250,000 from the investor) and a $280,000 five-year commercial term loan. Of that, $381,000 pays for the build-out, kitchen and furnishings, $79,500 covers opening costs and stock, and $384,500 stays in the bank as a reserve.
| Year 1 | Year 2 | Year 3 | |
|---|---|---|---|
| Revenue | $690,500 | $1,296,700 | $1,783,150 |
| Net income after start-up costs | ($225,131) | $32,033 | $168,091 |
| Closing cash | $246,399 | $267,049 | $368,489 |
Year 1 holds eight trading months and 88 events: 52 in the ballroom and 36 at other sites. It loses money because payroll and insurance are paid for four months, and rent for one, before the first guest arrives, and because venues typically sell dates a year or more ahead while a new one sells on short notice. Operating profit is positive in August, September, October and December. Year 2 is the first profitable year.
The numbers are also run against slow booking. If dates sell 20% short and the owners answer with later hires, smaller crews, lower marketing and pay cuts, the company still ends every year with cash in the bank and is profitable from Year 3, but debt service cover falls to 0.45x in Year 2 and the owners would need the bank to relax a covenant that year.
The pitch is a single contract. A couple or a committee signs one agreement for the room, the food, the service staff and the add-ons, and a retainer holds the date. There is no alcohol sold on the premises, which keeps the hall open to church groups, schools and corporate events that prefer an alcohol-free venue.
The Company and the Building
Legal name: Crest Mead, LLC, a Utah limited liability company. Owners: Joanna Hargrove (executive chef) and Elias Brandvold (venue and sales director), with an outside investor who holds about 44% and takes no part in operations. Premises: a leased 6,200 square foot building in Salt Lake City with about 90 surface parking spaces and an overflow arrangement with a neighboring business. Start date: January 1, 2027. Build-out runs through April and the first event is in May. Stage: pre-opening. The lease is in draft, the landlord's $50,000 tenant allowance is agreed in principle and the kitchen layout has been drawn.
What the hall is for
The aim is to offer couples, companies and congregations in the Salt Lake Valley one room and one kitchen under one contract, and to fill the calendar early enough that the lease is covered before the season starts.
Goals for the first three years
- Open in May 2027 and hold 52 events in the ballroom in the first eight months.
- Reach 104 ballroom events and $1,296,700 of revenue in 2028, with a small profit after tax.
- Reach 136 ballroom events in 2029 and an EBITDA margin above 12%.
- Repay the term loan on schedule by the end of 2031, with owner distributions beginning in 2029.
The building
| Space | Size | Use |
|---|---|---|
| Ballroom | 3,400 sq ft | Seats up to 225 at rounds; about 200 with a dance floor |
| Commercial kitchen | 1,300 sq ft | Production for hall events and off-site jobs |
| Two preparation suites, lobby, restrooms | 1,500 sq ft | Bridal and groom suites, coat room, guest restrooms |
Four revenue lines
| Line | How it earns | Year 1 share of revenue |
|---|---|---|
| Venue rental fees | $4,800 for a wedding, $3,500 corporate, $1,750 community | 26% |
| In-house catering at the venue | $54, $62 or $32 a guest, by event type | 46% |
| Coordination, AV and decor add-ons | Day-of coordinator, sound and projection, centerpieces and lighting | 10% |
| Off-site catering | Corporate lunches and dinners at other venues, about $3,300 an event | 17% |
The alcohol policy
No alcohol is sold, served or stored on the premises, and each contract states it. Utah's alcohol laws are widely described as restrictive and change over time, so any change to the policy would follow a check with the state alcohol regulator. The model has no alcohol revenue, no bar staff and no liquor liability cover.
Permits and approvals
A hall of this kind generally needs a city business license, a county health department plan review and food permit for the kitchen, fire and occupancy approvals for 225 guests, and a state sales tax account. The budget carries $9,500 for these and $4,500 in Year 1 for inspections and food-handler cards, both planning figures. Zoning and assembly-use approval for the building are a condition of signing the lease, and each requirement and fee is confirmed with the issuing office before work starts.
Salt Lake City's Event Calendar
A hall that sells on three calendars
Weddings generally cluster from May to October. Corporate events cluster in the fall and, above all, in December for holiday parties. Church and community events spread across the year with peaks around holidays and the school calendar. In a mature year about 12% of the hall's events fall in October, 11% each in June and September, 10% in December and about 14% across January, February and March together.
| Month | Share of a mature year's hall events |
|---|---|
| January to March | about 14% in total |
| April | 7% |
| May | 9.5% |
| June | 11% |
| July | 9% |
| August | 9.5% |
| September | 11% |
| October | 12% |
| November | 6% |
| December | 10% |
What the forecast rests on
The forecast does not use a count of Utah weddings or a statewide event spend. It rests on the number of dates the room can sell, the average ticket per event and the lead time at which dates are booked, all of which are planning figures that the owners test in tours and quotes before opening.
Who else sells a room and a meal
- Hotel ballrooms with in-house banquet departments
- Stand-alone banquet halls and reception centers
- Barns, outdoor and mountain-side venues that bring in a separate caterer
- Restaurants with private rooms and congregation or community halls that rent cheaply
- Caterers who cook at the client's venue
Competitor rates are gathered from each venue's published price list and tours before launch; none are quoted here.
SWOT
| Strengths | Weaknesses |
|---|---|
| Room, food and service under one contract, with one point of contact | Two businesses to build at once: a venue and a kitchen; weddings are about 46% of Year 1 revenue |
| A rental fee with a 4% direct cost under every catered event | Heavy fixed cost: rent, loan payments and a core team before the first date |
| No alcohol, so the hall suits church groups, schools and corporate buyers | Wedding clients who want a bar book elsewhere |
| Opportunities | Threats |
|---|---|
| Weekday corporate and nonprofit events that fill the off-peak calendar | Hotels and established halls discounting dates |
| Add-ons such as coordination, AV and decor sold with every date | Barns and outdoor venues taking spring and summer weddings |
| Off-site catering that keeps the kitchen busy between hall dates | Food and labor costs rising faster than a contract price signed a year ahead |
Who Books the Hall
The couple and their families
Most weddings are planned by two people with a parent or two contributing. They tour three or four halls, compare a price per guest and read every line of the contract. The ticket is large and emotional, and the date they want usually falls on a Friday, Saturday or Sunday between May and October.
The company, club or foundation
An office manager, an HR lead or a nonprofit development officer books a holiday dinner, a gala or an awards evening. The buyer wants a fixed price, a clean invoice and the same people each year. Corporate events fill Thursdays and Fridays, and December.
Congregations, schools and civic groups
Receptions, open houses, banquets and fundraising dinners, often for 60 to 120 people. Budgets are smaller, decisions come from a committee and events book with shorter notice. These events fill the weekday evenings and the January to March quiet months, and many such groups prefer a hall with no bar.
What each one asks of the hall
| Buyer | Average guests | Year 1 average ticket |
|---|---|---|
| Wedding or reception | 140 | $14,325 |
| Corporate or gala event | 125 | $12,655 |
| Church or community event | 90 | $4,963 |
Selling Dates a Year Out
From first tour to signed date
A tour of the room and a tasting for couples, a written quote within two working days, and a retainer of 25% of the estimated total to hold the date. Elias leads every tour in Year 1. The balance schedule is 50% of the total 90 days before the event and the remainder with the final guest count 14 days before.
The Year 1 pipeline
About 22 weddings from about 80 tours at a 28% close rate, about 14 corporate events from 40 proposals at a 35% close rate, and about 16 church and community events from 30 inquiries. Eighteen events are signed on retainers before the first one is held in May.
| Lead source | Share of hall events |
|---|---|
| Past guests, vendor referrals (photographers, planners, DJs, florists) | 34% |
| Wedding directories and search ads | 30% |
| Corporate outreach, chamber and association events | 18% |
| Congregation and community word of mouth | 18% |
Lead time and what it does to Year 1
Dates are typically booked six to 18 months ahead. A new hall has no calendar to sell from, so the first year is planned at 52 events, not the 104 of Year 2: wedding dates in May to August go mostly to couples with short engagements, and September to December fills from the open house and the bridal showcases.
How dates are priced
A peak-season Saturday sells at about $5,800 for the room alone, and a weekday evening from about $2,400. Fridays, Sundays and weddings outside May to October sell between $3,200 and $4,200, which is why the Year 1 wedding average is $4,800. Corporate events average $3,500 and community events $1,750. Prices rise about 3% a year from Year 2.
Keeping the calendar full
Cancellations forfeit the retainer and part of the balance. Repeat business comes from the corporate and congregation clients, who book the same weekend each year, and from wedding guests who book their own events later. Every date is modeled as a one-off sale, with no repeat rate.
Spending to Fill the Calendar
Year 1 marketing budget
The first-year budget is $66,000: $24,000 of launch spending from start-up capital and $42,000 of operating spend. That is 9.6% of Year 1 revenue; the share falls to 4.0% in Year 2 and 3.4% in Year 3 as past guests and vendors carry more of the load. Spread over the 52 hall events, Year 1 costs about $1,270 an event.
| Channel | Year 1 spend | What it does |
|---|---|---|
| Website, video tour and photography (launch) | $11,000 | A visible, bookable hall before the first event |
| Open house and tasting (launch) | $5,500 | First tours for couples, planners and corporate buyers |
| Two bridal showcase booths (launch) | $4,500 | Direct contact with couples early in their search |
| Signage and printed collateral (launch) | $3,000 | Street presence and tour handouts |
| Wedding directories and listings | $9,000 | Listings where couples search for halls |
| Search ads | $10,500 | Queries for Salt Lake City venues and caterers |
| Social media and short video | $4,500 | Real events, with permission from clients |
| Annual showcases and trade events | $5,000 | Wedding and corporate buyers in one room |
| Vendor referral program | $3,500 | Thank-you events and gifts for planners, photographers and florists |
| Corporate outreach | $4,500 | Chamber memberships and lunches with office managers |
| Congregation and community outreach | $2,000 | Open nights and tours for groups |
| Tasting events for couples | $3,000 | Food cost of tastings |
Marketing milestones
- January 2027: website live and the first tours booked against the build-out.
- March 2027: open house, with 18 dates signed on retainers.
- May 2027: first event held, with 30 of the 50 June to December dates signed.
- September 2027: second bridal showcase and holiday party outreach for December.
- January 2028: about 40 of the 104 planned 2028 hall events already signed.
Running the Hall and the Kitchen
The room
The ballroom is a flexible hall with a built-in sound and lighting system, a stage, and a floor that clears in about an hour between a ceremony and a dinner. 30 round tables and 260 chairs seat 225 guests; cocktail rounds and lounge sets turn the room for receptions. The hall hosts one event a day and does not double-book.
The kitchen
A 1,300 square foot commercial kitchen with a hood and fire suppression, ranges and ovens, a walk-in cooler and freezer, a prep line and a dish machine. It prepares food for hall events and loads a refrigerated van for off-site jobs. Joanna writes the menus and costs every plate.
An event day
The kitchen lead and prep team start at 8 a.m. for an evening event; the captain and pool crew set the room from 1 p.m. A plated wedding for 140 guests runs with about ten pool staff: six servers, two line cooks, one setup and teardown hand and one on the dish line, in addition to the kitchen team. The room is turned and cleaned by midnight. A community buffet runs with about five.
Event volume and paid hours
| Year 1 | Year 3 | Year 5 | |
|---|---|---|---|
| Hall events | 52 | 136 | 160 |
| Off-site events | 36 | 60 | 70 |
| Pool wages | $76,900 | $178,400 | $209,100 |
| Paid pool hours (at $17) | about 4,520 | about 10,490 | about 12,300 |
Equipment and upkeep
China, flatware, glassware and linens for 260 guests, a used refrigerated van and sound and lighting gear. Replacement spending begins in Year 2 at $6,000 and reaches $14,000 by Year 5, with a separate allowance for breakage and linen.
Insurance and food safety
General liability and property cover for the building contents, commercial auto for the van, workers' compensation in the payroll on-costs and cyber cover for client data. Insurance is $22,000 in Year 1. No liquor liability cover is carried because no alcohol is sold. Every kitchen employee holds a food handler card, and Joanna and the kitchen lead hold food protection manager certificates.
Suppliers
Food, produce and dairy come from two broadline suppliers and one local farm for seasonal produce. Linen laundry, rented chairs for overflow, florals and AV help are each sourced from at least two vendors.
Who Runs Crest Mead
Joanna Hargrove, executive chef and co-owner
Joanna has fourteen years in Salt Lake City kitchens: eight in a hotel banquet kitchen, rising to banquet sous chef, and six as chef de cuisine for an independent caterer. She holds a food protection manager certificate. Her $200,000 is fourteen years of savings. She is paid $70,000 from month 1.
Elias Brandvold, venue and sales director and co-owner
Elias has nine years in banquet sales and event management at a downtown hotel, where he booked about 90 events a year and ran the event-day floor. His $115,000 is his savings. He is paid $64,000 from month 1.
The investor
An outside investor puts in $250,000 for a minority share of about 44%, set by cash invested rather than by role. The investor is paid through distributions only, in proportion to ownership, and has no role in operations. The shareholders' agreement would give the founders a right to buy the investor out from Year 5 on terms set with counsel; no exit price is fixed in the plan.
Where the team is thin
Joanna has not run a profit and loss for a whole business, and Elias has not operated a commercial kitchen. Neither has managed a build-out. These gaps are covered by a part-time bookkeeper, a fixed-price contractor bid with a contingency of about 15% of the $160,000 net build-out cost (11% of the $210,000 bid), a weekly review of food cost by plate, and a kitchen lead hired at the start of the first event month.
If an owner is out
The kitchen lead can run production for a week. The event coordinator can run an event day without Elias, and the second coordinator, hired in month 48, covers tours as well. The company carries key-person life and disability cover on both owners.
Outside help
A local accountant who works with food businesses reviews the books each quarter, and an event-industry consultant reviews the pricing and contract before the first dates are sold.
Ownership and the bank
The two owners hold 55.8% between them (Joanna 35.4%, Elias 20.4%) and the investor 44.2%. The bank takes a lien on the kitchen equipment and personal guarantees from both owners, and the loan agreement carries a cap on distributions.
The Numbers Behind the Calendar
The tables below come from one five-year model that runs month by month for 2027 and by year after that. Funding and inputs come first, then revenue, staffing, profit, cash, the balance sheet, a downside case and a set of sensitivities.
What it costs to open the hall
| Use of funds | Amount |
|---|---|
| Ballroom, suites, restrooms and entry build-out on a fixed-price contractor bid, net of a $50,000 landlord allowance | $160,000 |
| Build-out contingency, about 15% of the $160,000 net build-out cost (11% of the $210,000 bid), released only against change orders | $24,000 |
| Commercial kitchen: hood and fire suppression, ranges, ovens, walk-in cooler and freezer, prep and dish line | $88,000 |
| Banquet furniture: 30 round tables, 260 chairs, cocktail rounds, staging, lounge sets and dance floor | $46,000 |
| Sound, lighting and presentation system, with a wireless microphone kit | $18,000 |
| Used refrigerated van, hot boxes and transport carts | $24,000 |
| China, flatware, glassware and linens for 260 guests | $21,000 |
| Business license, health department plan review, fire and occupancy approvals | $9,500 |
| Architect drawings, lease review, entity set-up and insurance placement | $22,000 |
| Launch: website and video tour, photography, open house and two bridal showcases | $24,000 |
| Kitchen trials, menu costing and pre-opening staff training (wages and food) | $14,000 |
| Opening stock: dry goods, disposables, candles, napkins and cleaning supplies | $10,000 |
| Reserve for the build-out months, the slow first spring and the first winter | $384,500 |
| Total uses | $845,000 |
| Source of funds | Amount |
|---|---|
| Joanna Hargrove, savings | $200,000 |
| Elias Brandvold, savings | $115,000 |
| Outside investor, minority share | $250,000 |
| Commercial term loan (5 years, interest only for the first 6 months) | $280,000 |
| Total sources | $845,000 |
Equity totals $565,000, 67% of the $845,000 raise: Joanna Hargrove contributes $200,000 and Elias Brandvold $115,000 of personal savings, and an outside investor takes a minority stake for $250,000. Ownership follows cash invested with no credit for sweat equity, which gives the investor about 44%, Joanna 35% and Elias 20%. The remaining $280,000, 33%, is a five-year commercial term loan at 10.0% with six interest-only months; the rate is a figure picked for this example, not a quote. A lender may ask for an SBA guarantee, a lien on the kitchen equipment and personal guarantees from both owners. Of the raise, $381,000 goes to the build-out, kitchen and furnishings and $79,500 to opening costs and stock, which leaves $384,500 as a cash reserve. That reserve covers four pre-opening months of payroll and insurance and one month of rent, and it was sized against three tests: a lowest month-end balance of about $124,000 in August 2027, a two-month opening slip that bottoms near $52,000 in September 2027, and a drawdown of roughly $96,000 across January to March 2028. A $40,000 build-out overrun, paid from the reserve, would cut the 2027 low to about $84,000.
Inputs behind the forecast
- The ballroom holds 52 events in Year 1 (22 weddings and receptions, 14 corporate and gala events, 16 church and community events), then 104, 136, 149 and 160 in Years 2 to 5. Off-site catering adds 36, 50, 60, 66 and 70 events. At 136 events in Year 3 the room is booked about every 2.7 days; the heaviest weekends fill and weekday evenings stay open.
- Seasonality follows a Utah event year. In a mature year, October carries about 12% of the hall's events, June and September 11% each, December 10%, and May and August about 9.5% each, while January to March together carry about 14%. Year 1 is laid out month by month around a May opening; Years 2 to 5 are annual totals that use the same shape only for event-day labor.
- A rental fee buys an eight-hour block with tables, chairs, house linens, setup and teardown. Year 1 averages are $4,800 for a wedding or reception, $3,500 for a corporate or gala event and $1,750 for a church or community event. A peak-season Saturday sells near $5,800 for the room alone, and Fridays, Sundays and off-season dates sell between $3,200 and $4,200. These are planning prices for a new hall, not a market survey. Prices rise about 3% a year.
- In-house catering is $54 a guest for weddings (140 guests on average), $62 for corporate events (125 guests) and $32 for church and community events (90 guests), covering food, service staff and a non-alcoholic beverage station. Coordination, AV and decor add-ons average $1,965 per wedding, $1,405 per corporate event and $333 per community event.
- A full wedding averages about $14,325 in Year 1 (fee, catering and add-ons), a corporate event $12,655 and a community event $4,963. Across all hall events the average is about $10,994 in Year 1, $11,567 in Year 3 and $12,228 in Year 5. Weddings supply about 46% of Year 1 revenue and about half of Year 3, the plan's main concentration. Off-site jobs average $3,300 in Year 1, from corporate lunches to full-service dinners at other venues.
- Direct costs are 33% of in-house catering, 36% of off-site catering, 42% of add-ons (florals, rented gear, outside AV help) and 4% of rental fees (linen laundry and supplies). The engine applies the Year 1 blend, 26.7% of revenue, to every year, so a line's own margin holds only in Year 1. Utah sales and use tax is not in the revenue figures; how prepared food and room rental are taxed is a question for the Utah State Tax Commission.
- Event-day labor is paid per event from a part-time pool: about $1,250 of wages for a plated wedding of 140 guests (roughly ten people: six servers, two line cooks, a setup hand and a dish hand), $1,150 for a corporate event, $640 for a community event and $640 for an off-site job. That is about 4,520 paid hours in Year 1 and 10,490 in Year 3 at an average $17 an hour, a planning figure well above the $7.25 federal and Utah minimum wage (U.S. Department of Labor state minimum wage page, updated July 1, 2026). The price per guest includes service, so no tip line is modeled; if guests tip staff directly, employer payroll tax applies to reported tips. Pool staff carry 15% on-costs, the full-time team 27%, and 3% annual raises appear as a separate line from Year 2.
- The building is 6,200 square feet at $20.50 a square foot a year, a planning figure that covers base rent, shared charges and property taxes: $127,100 a year, stepping up 3% a year on a ten-year lease with personal guarantees. Three months are rent-free during build-out, so Year 1 pays nine months, $95,325. The build-out line rests on a fixed-price contractor bid of $210,000 for a former event or showroom space that already has restrooms, heating and cooling and sprinklers. The landlord's $50,000 allowance is netted from the bid, and a $24,000 contingency covers change orders. Build-out cost per square foot, kitchen equipment, insurance and professional fees are planning figures to be replaced by bids and quotes.
- The hall neither sells, serves nor stores alcohol, and every contract says so. Utah's alcohol laws are widely described as restrictive and change over time, so the owners would confirm current rules with the state regulator before altering the policy. No revenue or cost in the model depends on alcohol.
- Deposits follow a written schedule: a non-refundable 25% retainer at signing, 50% in total 90 days ahead, and the balance with the final guest count 14 days before the event. Corporate and community accounts are invoiced on 15-day terms. The model books revenue and cash in the month of the event, carries receivables at 5 days of sales and payables at 21 days of direct costs, and leaves out deposits held ahead of events, which a real balance sheet would show as a liability. Held deposits are not free cash and sit in a separate account.
- Tax uses the federal corporate rate of 21% (26 U.S.C. 11(b), law.cornell.edu) and a Utah rate of 4.5%, a planning figure to confirm with the Utah State Tax Commission. The engine's tax base ignores the $69,500 of start-up costs and does not apply the federal 80% limit on using loss carryforwards, so tax in Years 2 and 3 is approximate. A two-owner LLC is taxed as a partnership by default, which would move tax to the owners' personal returns; corporate rates are the cautious choice, and a CPA would confirm the structure.
- Owner distributions are $50,000, $110,000 and $135,000 in Years 3 to 5, $295,000 in all, against $307,256 of cumulative net income after start-up costs. Each year's payout is below that year's net income and below cash after loan principal. Cumulative net income is still negative at the end of Year 3 (minus $25,007) and $140,816 at the end of Year 4, so the first two payouts, in Years 3 and 4, partly return invested capital rather than profit. Retained earnings stay negative until Year 5, and a Utah LLC would check its solvency tests with counsel before each payout. The investor takes about 44% of each, and a lender would typically cap them in the loan agreement.
Revenue by line
| Revenue stream | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| Venue rental fees | $182,600 | $362,650 | $506,050 | $570,400 | $627,350 |
| In-house catering at the venue | $320,900 | $631,350 | $878,750 | $992,850 | $1,096,050 |
| Coordination, AV and decor add-ons | $68,200 | $132,750 | $188,300 | $212,300 | $233,150 |
| Off-site catering | $118,800 | $169,950 | $210,050 | $238,000 | $260,000 |
| Total revenue | $690,500 | $1,296,700 | $1,783,150 | $2,013,550 | $2,216,550 |
| Growth on prior year | – | 88% | 38% | 13% | 10% |
In-house catering is the largest line, 46% of Year 1 revenue and 49% of Year 3. Rental fees are 26% and 28%, and with a 4% direct cost they yield about 37% of Year 3 gross profit from 28% of revenue. Off-site catering slides from 17% to 12% of the total as hall events claim the kitchen. Growth of 88% in Year 2 reflects only eight trading months in Year 1; it then eases to 38%, 13% and 10% as the calendar nears the 160 dates the room can practically carry.
Year 1: four quiet months, then eight of events
| Month | Venue rental fees | In-house catering at the venue | Coordination, AV and decor add-ons | Off-site catering | Total revenue | EBITDA |
|---|---|---|---|---|---|---|
| Jan 2027 | $0 | $0 | $0 | $0 | $0 | ($49,058) |
| Feb 2027 | $0 | $0 | $0 | $0 | $0 | ($49,058) |
| Mar 2027 | $0 | $0 | $0 | $0 | $0 | ($49,058) |
| Apr 2027 | $0 | $0 | $0 | $0 | $0 | ($49,058) |
| May 2027 | $6,550 | $10,450 | $2,300 | $9,900 | $29,200 | ($27,665) |
| Jun 2027 | $17,900 | $28,450 | $6,550 | $13,200 | $66,100 | ($631) |
| Jul 2027 | $17,900 | $28,450 | $6,550 | $9,900 | $62,800 | ($3,048) |
| Aug 2027 | $21,400 | $36,200 | $7,950 | $9,900 | $75,450 | $6,220 |
| Sep 2027 | $31,000 | $51,300 | $11,900 | $16,500 | $110,700 | $32,045 |
| Oct 2027 | $36,250 | $61,950 | $13,650 | $16,500 | $128,350 | $44,976 |
| Nov 2027 | $15,300 | $28,800 | $5,450 | $13,200 | $62,750 | ($3,085) |
| Dec 2027 | $36,300 | $75,300 | $13,850 | $29,700 | $155,150 | $64,611 |
Nothing is earned from January to April 2027 while the hall is built, fitted and licensed, and the first event is in May. The monthly view spreads annual non-payroll costs evenly, so rent, utilities and insurance are charged to the build-out months too; January to April therefore look worse than the cash that actually leaves, and the busy months look better than a ledger would. EBITDA is positive in August, September, October and December ($6,220, $32,045, $44,976 and $64,611) and negative in the other eight months. The lowest month-end cash balance is August 2027, at about $124,000 after allowing 5 days for clients to pay; this is an approximate figure, and deposits received ahead of events are not counted and would sit on top. A seasonal trough in January to March 2028 is not drawn in the annual model; a rough estimate from the mature-year shape is a drawdown of about $96,000, taking cash to about $150,000 by the end of March 2028.
Staffing and the event-day pool
| Role | Annual wage | Starts | Year 1 end | Year 2 end | Year 3 end | Year 4 end | Year 5 end |
|---|---|---|---|---|---|---|---|
| Owner and executive chef (Joanna Hargrove) | $70,000 | Month 1 | 1 | 1 | 1 | 1 | 1 |
| Owner and venue sales director (Elias Brandvold) | $64,000 | Month 1 | 1 | 1 | 1 | 1 | 1 |
| Kitchen lead and sous chef | $56,000 | Month 5 | 1 | 1 | 1 | 1 | 1 |
| Venue and banquet captain | $42,000 | Month 22 | – | 1 | 1 | 1 | 1 |
| Event coordinator | $46,000 | Month 6 | 1 | 1 | 1 | 1 | 1 |
| Prep cook (full time) | $37,000 | Month 20 | – | 1 | 1 | 1 | 1 |
| Sales and guest-care coordinator | $42,000 | Month 30 | – | – | 1 | 1 | 1 |
| Catering chef (second kitchen lead) | $50,000 | Month 42 | – | – | – | 1 | 1 |
| Second event coordinator | $46,000 | Month 48 | – | – | – | 1 | 1 |
| Event-day pool: servers, setup, teardown and dish crew (paid per event) | $12,000 | Month 5 | 0.5 | 0.5 | 0.5 | 0.5 | 0.5 |
| Total payroll incl. on-costs | $340,222 | $489,034 | $635,865 | $720,700 | $815,660 |
Joanna and Elias are on payroll from month 1 at $70,000 and $64,000, both with 27% on-costs, so the profit lines are what is left after they are paid. The kitchen lead starts in month 5 (May 2027), the first event month, and the event coordinator in month 6. The prep cook joins in month 20 (August 2028), the venue and banquet captain in month 22, the sales and guest-care coordinator in month 30 (June 2029), a second kitchen lead in month 42 and a second event coordinator in month 48 (December 2030). The event-day pool is one line counted as half a position at each year end; on a wedding day it is about ten people, paid only for events held. Coverage check, using planning ratios of about 20 coordinator hours per hall event (12 on site, 8 of meetings and run sheets) and 8 per off-site job: the floor needs about 1,330 hours in Year 1, 3,200 in Year 3 and 3,760 in Year 5, against about 1,210 coordinator hours in Year 1 (seven months of one coordinator, so Elias covers roughly 120 hours on top of tours), 4,160 in Year 3 (coordinator and captain) and 6,240 in Year 5. In the kitchen, at about 14 salaried hours per hall event and 6 per off-site job, the need is about 940 hours in Year 1, 2,260 in Year 3 and 2,660 in Year 5, against the kitchen lead's 1,390 hours in Year 1 and two full-time cooks from late 2028, with Joanna's own time on top. Peak weeks with four or five events are the thin spot. The salaried roles sit above the federal weekly salary floor for exempt status (about $684 a week, or $35,568 a year, a planning figure to confirm with the U.S. Department of Labor); the prep cook at $37,000 is close to it, and if that role is hourly, overtime beyond 40 hours in peak weeks adds cost that the model does not carry.
Profit and loss after the owners are paid
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|
| Revenue | $690,500 | $1,296,700 | $1,783,150 | $2,013,550 | $2,216,550 |
| Direct costs (food, non-alcoholic beverages, disposables, decor materials and rented items) | ($184,613) | ($346,687) | ($476,745) | ($538,345) | ($592,620) |
| Gross profit | $505,887 | $950,013 | $1,306,405 | $1,475,205 | $1,623,930 |
| Payroll incl. on-costs | ($340,222) | ($489,034) | ($635,865) | ($720,700) | ($815,660) |
| Rent | ($95,325) | ($130,913) | ($134,840) | ($138,885) | ($143,052) |
| Utilities | ($24,000) | ($33,000) | ($34,000) | ($35,000) | ($36,000) |
| Marketing | ($42,000) | ($52,000) | ($60,000) | ($64,000) | ($68,000) |
| Insurance | ($22,000) | ($25,000) | ($27,000) | ($28,500) | ($30,000) |
| Professional fees | ($12,000) | ($9,000) | ($9,500) | ($10,000) | ($10,500) |
| Software subscriptions | ($6,000) | ($7,500) | ($8,000) | ($8,500) | ($9,000) |
| Card, ACH and wedding-platform fees | ($18,650) | ($35,000) | ($48,150) | ($54,350) | ($59,850) |
| Venue repairs and maintenance: HVAC service, floors, lighting, grease trap | ($6,000) | ($12,000) | ($14,000) | ($16,000) | ($18,000) |
| Janitorial service and waste hauling | ($9,000) | ($15,000) | ($16,000) | ($17,000) | ($18,000) |
| Van fuel, upkeep and delivery | ($3,500) | ($6,000) | ($7,000) | ($7,500) | ($8,000) |
| Permits, inspections and food-handler cards | ($4,500) | ($3,500) | ($3,600) | ($3,800) | ($4,000) |
| Breakage and linen replacement | ($4,000) | ($8,000) | ($10,500) | ($11,500) | ($12,500) |
| Equipment replacement reserve | $0 | ($6,000) | ($10,000) | ($12,000) | ($14,000) |
| Bad debt allowance (corporate invoices and chargebacks) | ($1,500) | ($3,000) | ($4,000) | ($4,500) | ($5,000) |
| Annual pay raises (3% a year) | $0 | ($14,671) | ($38,724) | ($66,828) | ($102,373) |
| EBITDA | ($82,810) | $100,394 | $245,226 | $276,142 | $269,995 |
| Depreciation | ($45,343) | ($45,343) | ($45,343) | ($45,343) | ($45,343) |
| Interest | ($27,478) | ($23,018) | ($17,311) | ($11,006) | ($4,041) |
| Income tax | $0 | $0 | ($14,481) | ($53,970) | ($54,171) |
| Net income before start-up costs | ($155,631) | $32,033 | $168,091 | $165,823 | $166,440 |
| Start-up costs expensed at opening (legal, licensing, launch marketing) | ($69,500) | $0 | $0 | $0 | $0 |
| Net income after start-up costs | ($225,131) | $32,033 | $168,091 | $165,823 | $166,440 |
Year 1 loses $155,631 before start-up costs and $225,131 after them: four months of payroll and insurance come before the first event, and then eight months of a growing calendar follow. Depreciation of $45,343 is charged for a full year in Year 1 although the hall is in service for eight months, which makes Year 1 about $15,000 worse than a month-weighted charge. Year 2 is the first profitable year at $32,033, a 2.5% net margin. Year 3 earns $168,091, a 9.4% net margin and a 13.8% EBITDA margin, with tax of $14,481 because most of the Year 1 loss carries forward. Year 4 slips to 8.2% net as the second kitchen lead and a full tax charge arrive, and Year 5 is 7.5% after the second coordinator.
Cash, deposits and the loan
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|
| Cash from operations | ($192,318) | $75,155 | $211,651 | $210,321 | $211,040 |
| Ballroom build-out, kitchen and furnishings | ($381,000) | $0 | $0 | $0 | $0 |
| Funding received | $845,000 | $0 | $0 | $0 | $0 |
| Term loan principal repaid | ($25,283) | ($54,505) | ($60,212) | ($66,517) | ($73,482) |
| Owner distributions | $0 | $0 | ($50,000) | ($110,000) | ($135,000) |
| Net change in cash | $246,399 | $20,650 | $101,439 | $33,804 | $2,557 |
| Closing cash | $246,399 | $267,049 | $368,489 | $402,293 | $404,850 |
Closing cash is positive at every year end, and the lowest year-end balance, $246,399, comes after Year 1. The lowest month-end balance falls in August 2027. Distributions start in Year 3 and the term loan is fully repaid by the end of Year 5. Year 5 cash of $404,850 is about 2.5 months of costs, which is the buffer for a quiet January to March that the annual figures do not show. Customer deposits are excluded from these balances because they stay in a separate account until the event is held.
Balance sheet at each year end
| At year end | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| Cash | $246,399 | $267,049 | $368,489 | $402,293 | $404,850 |
| Accounts receivable | $9,459 | $17,763 | $24,427 | $27,583 | $30,364 |
| Food, disposables and event supplies | $13,692 | $16,934 | $19,535 | $20,767 | $21,852 |
| Ballroom build-out, kitchen and furnishings (net) | $335,657 | $290,314 | $244,971 | $199,629 | $154,286 |
| Total assets | $605,207 | $592,060 | $657,422 | $650,271 | $611,352 |
| Vendor payables (food, floral, rentals) | $10,622 | $19,946 | $27,429 | $30,973 | $34,096 |
| Commercial term loan | $254,717 | $200,212 | $140,000 | $73,482 | $0 |
| Paid-in capital | $565,000 | $565,000 | $565,000 | $565,000 | $565,000 |
| Retained earnings | ($225,131) | ($193,098) | ($75,007) | ($19,185) | $12,256 |
| Total liabilities and equity | $605,207 | $592,060 | $657,422 | $650,271 | $611,352 |
Margins, break-even and labor
| Measure | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| EBITDA margin | -12.0% | 7.7% | 13.8% | 13.7% | 12.2% |
| Net margin (before start-up costs) | -22.5% | 2.5% | 9.4% | 8.2% | 7.5% |
| Payroll incl. pay raises as share of revenue | 49% | 39% | 38% | 39% | 41% |
| Revenue per full-time equivalent at year end | $153,444 | $199,492 | $237,753 | $211,953 | $233,321 |
| Average monthly revenue | $57,542 | $108,058 | $148,596 | $167,796 | $184,713 |
| Monthly revenue needed to cover operating costs | $66,961 | $96,639 | $120,703 | $136,386 | $154,002 |
| Debt service cover (EBITDA / interest + principal) | -1.6x | 1.3x | 3.2x | 3.6x | 3.5x |
In Year 1 the company averages $57,542 of revenue a month against $66,961 needed, a shortfall; Year 2 averages $108,058 against $96,639. Debt service cover is negative in Year 1 and 1.29x in Year 2, just above a likely 1.25x covenant, then above 3x from Year 3. The sensitivities below show how little slippage breaks that Year 2 test. Revenue per full-time equivalent counts the event pool as half a position; counting pool hours at 2,080 a year per position gives about $112,000 in Year 1 and about $148,000 in Years 3 and 5. Payroll with pay raises is 49% of revenue in Year 1, 38% in Year 3 and 41% in Year 5.
If bookings run 20% short
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|
| Revenue | $552,400 | $1,037,360 | $1,426,520 | $1,610,840 | $1,773,240 |
| Net income before start-up costs | ($187,800) | ($33,245) | $75,627 | $88,719 | $136,055 |
| Net income after start-up costs | ($257,300) | ($33,245) | $75,627 | $88,719 | $136,055 |
| Closing cash | $214,736 | $170,552 | $209,883 | $232,752 | $286,073 |
This case cuts every revenue line by 20% in every year through fewer events. Costs that follow event volume fall with it: the event-day pool shrinks by a fifth, and card fees, bad debt, van costs and breakage are cut by 20% in every year. The owners' responses start when the shortfall is visible. At month 4, signed retainers are 20% short of plan and the event coordinator hire moves from June to December 2027. Joanna and Elias each take a 20% pay cut from July 2027. From Year 2, marketing is cut 20% and the equipment replacement reserve 30%. The prep cook, captain and sales coordinator start six months late, and the second kitchen lead and second coordinator are never hired. Year 1 marketing and other annual lines are left untouched. Distributions are scaled to 40% of the base case, $20,000, $44,000 and $54,000 in Years 3 to 5; at $118,000 in all against $9,856 of cumulative net income by Year 5, they are a return of capital in each of those years. On those terms the company loses money in Years 1 and 2 ($257,300 and $33,245 after start-up costs), then earns $75,627, $88,719 and $136,055. The Year 3 net margin is 5.3% on $1,426,520 of revenue, which is thin. Debt service cover is negative in Year 1, 0.45x in Year 2 and 1.78x in Year 3, so a 1.25x covenant fails in Years 1 and 2 (it also cannot be met in Year 1 in the base case). Year-end cash never falls below $170,552 and is under the base case in every year; Year 1 equity ends at $307,700. The lowest month-end balance in the engine's monthly view is about $138,000 in August 2027, above the base case low of $124,000. That is a feature of the monthly view, which spreads Year 1 payroll evenly and so does not place the pay cuts and the later coordinator hire in the months they start; it should not be read as the downside holding more cash than the base case in that month. The ask of the bank is a covenant holiday with the cover test starting on Year 3 accounts, and a distribution cap tied to cover rather than a fixed schedule.
Sensitivities
Each row changes one input in the base case and leaves distributions as in the base case. Revenue cases remove events, so the event-day pool, card fees, bad debt, van costs and breakage fall with sales; direct costs stay a fixed share of sales. Every figure comes from the same engine run, and the January to March 2028 trough is not drawn in any of them.
| Case | Year 2 net income | Year 2 cover | Year 3 net income | Lowest 2027 month-end cash | Year 5 closing cash |
|---|---|---|---|---|---|
| Base case | $32,033 | 1.29x | $168,091 | about $124,000 | $404,850 |
| Revenue 10% lower, costs that follow volume scale with it | ($43,554) | 0.32x | $82,076 | about $116,000 | $58,743 |
| Direct costs 3 points higher on every line | ($6,868) | 0.79x | $129,077 | about $117,000 | $226,268 |
| Wages 10% higher, including the event pool | ($18,337) | 0.65x | $115,112 | about $101,000 | $161,609 |
| Rent 10% higher | $18,942 | 1.13x | $163,473 | about $117,000 | $356,337 |
| Rental fees 15% lower, same events | ($19,487) | 0.63x | $110,926 | about $115,000 | $165,177 |
| Build-out $40,000 over bid, paid from the reserve | $28,033 | 1.29x | $167,037 | about $84,000 | $369,761 |
Opening two months late: the whole Year 1 revenue ramp and every hire after the owners move back two months, rent and owner payroll continue as planned, and the November and December 2027 events are dropped, not moved into 2028. Year 1 then loses $333,874 after start-up costs, ends with $138,390 of cash and $231,126 of equity, and the lowest month-end balance is about $52,000 in September 2027. Cash stays positive, with about $52,000 of headroom at the low point, which is why the reserve is $384,500.
The result is fragile in Year 2. Debt service cover is 1.29x in the base case, and each of the first five cases above takes it under 1.25x, and four of them under 1.0x. Cash, not profit, carries that year: Year 2 closing cash stays above $150,000 in every case in the table. A revenue shortfall of 10% with the Year 3 to 5 payouts unchanged leaves $58,743 at the end of Year 5, so the owners would cut those payouts first.
What a lender would still ask
- Lease and guarantees. The ten-year lease is in draft; the landlord's $50,000 allowance needs to be in writing, assembly-use zoning confirmed before signing, and the personal guarantees from both owners sized against the owners' other obligations.
- Covenants. Cover of 1.29x in Year 2 leaves almost no room against a 1.25x test; the owners would ask for the first test on Year 3 accounts.
- Owner track record. Joanna has not run a whole company's books, Elias has not run a commercial kitchen, and neither has managed a build-out.
- Build-out bids. A fixed-price contract for the $210,000 scope, the $24,000 contingency terms and the timetable for permits and plan review ahead of a May 2027 opening.
- Reserve against the lows. A $124,000 low in August 2027, about $52,000 in a two-month slip and roughly $150,000 at the end of March 2028 are estimates on a monthly view that spreads annual costs evenly and ignores deposits held.
- Investor return and split. The investor receives about $130,500 of the $295,000 in distributions by Year 5, roughly 0.5x the $250,000 invested, plus a 44% stake in book equity of about $577,000; no exit price is fixed, and the split follows cash invested.
- Distributions. The first two payouts, in Years 3 and 4, exceed cumulative net income and return capital; the loan agreement would cap them.
- Sales tax. How Utah taxes prepared food and room rental is not sized in the revenue figures.
Sources
- U.S. Code, 26 U.S.C. 11(b), Legal Information Institute: the 21% federal corporate income tax rate.
- U.S. Department of Labor, state minimum wage laws, updated July 1, 2026: Utah and federal minimum wage of $7.25 an hour.
- Salt Lake County Health Department, food program information: plan review and permits for food establishments.
- U.S. Small Business Administration, apply for licenses and permits: general guidance on the license and permit path for a new business.
- Planning figures to confirm with the issuing offices: the 4.5% Utah rate (Utah State Tax Commission), the weekly exempt-salary floor (U.S. Department of Labor), alcohol rules (Utah state regulator), permit costs (Salt Lake City licensing).
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