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This consideration of reducing your profit for the sake of establishing an ongoing relationship is valid. I didn't consider it when I posted my reply.
Just me, but a consideration of a price reduction for the sake of an ongoing relationship, translates to an ongoing price reduction.
I'm not really understanding this whole thread. You are a plate up caterer, and this restaurant wants to sell your food?
What are they expecting? Plated food, bulk food, ?? The OP needs to decide if he or she wants to enter the wholesale market. A lot of pro's and con's come along with this decision. My first thought would be quality consideration. If you've grown your catering business on food quality, than I'd be leery about attaching my name to a product another vendor is going to be responsible for.
I can go on. I've been in both markets for a bit of time.
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