How to Start a Catering Business
Starting a catering business can be an exciting and rewarding venture. Whether you're a seasoned chef or a passionate food enthusiast, the catering industry offers a unique platform to showcase your culinary skills. It allows you flexibility and the opportunity to get creative in the kitchen, plus it can be a low-risk option for those new to the business.
Whether you’re completely new to the industry or you’re looking to change direction, we’re here to explain how to set up a catering business with this comprehensive guide. Here we’ll cover what a catering business entails, the advantages it brings, the rules and regulations you need to be aware of in the UK, and provide you with a detailed step-by-step guide on how to start your own successful catering company.
- What is a catering business?
- The benefits of starting a catering business
- The rules and regulations for starting a catering business
- 8 steps to setting up a catering business
What is a catering business?
A catering business involves the preparation and provision of food services for various events and gatherings. Unlike traditional restaurants, cafes, or food trucks, catering businesses operate on a contract basis, delivering food to specific events, such as weddings, corporate functions, parties, and more. This distinction sets the catering sector apart from other food businesses as it focuses on providing a tailored and specialised dining experience for a predetermined number of guests.
One key difference between catering companies and other types of food businesses is the menus. The vast majority of the time, restaurants and other food ventures have rigid menus (besides special daily dishes). Catering companies on the other hand can be more flexible and tailor some dishes to meet the preferences of clients, which can be a valuable bonus when it comes to attracting repeat customers.
The benefits of starting a catering business
Starting a catering business is a big commitment and should be taken seriously, just like starting any other hospitality business. However, the catering sector does have a number of advantages which dine-in establishments don’t. Below are some of the main benefits of starting your own catering company.
Freedom and flexibility
One of the primary benefits of starting a catering business is the unparalleled freedom and flexibility the venture offers. As a caterer, you have the autonomy to choose the events you want to cater, allowing you to align your business with your preferences and strengths. This flexibility extends to the types of cuisine you offer, the scale of events you undertake, and even your work schedule.
Lower start-up and running costs
Compared to establishing a bar or restaurant, starting a catering business typically incurs lower initial costs. If you’re starting your catering business at home, the absence of a fixed commercial location eliminates the need for hefty rent expenses associated with professional kitchen spaces. And if you are planning on running a more large-scale operation from a commercial kitchen space, rent will likely still be cheaper than other food establishments. This is because, like ghost kitchens, catering businesses don’t require a dine-in area.
As well as lower costs for setting up your business, you may also find the running costs to be lower than the average dine-in establishment. Not only do you not have to pay for the maintenance of a dine-in area, but as the number of portions is predetermined, you can reduce the cost of wasted ingredients and lower your environmental impact in the process.
Can be started at home
One of the most attractive aspects of a catering business is its suitability for starting from home. As previously mentioned, this option can significantly reduce overhead expenses associated with renting a commercial kitchen. This comes with all the bonuses the typical business owner has when working from home, such as no commute and more flexible working hours.
It’s important to note that this is not necessarily the best option for every catering start-up. While it can be a great place to start for smaller businesses, larger catering companies will likely need more space than the average home kitchen has to offer. It's also crucial that you navigate the rules and regulations for starting a catering business at home, ensuring your company complies with health and safety standards.
The catering sector offers budding chefs a diverse range of opportunities to showcase their culinary creativity. As menus may differ somewhat from each event, it’s an ideal option for those looking to widen their culinary expertise and cater to a broad audience. Depending on how you market your business, you may also be able to prepare food for a wide range of different functions. Each event presents a unique challenge, whether it's a formal wedding reception, a lively corporate party, or an intimate private gathering. This variety not only keeps the job interesting but also allows you to get a wide range of valuable experience in the industry.
Control over clients
Unlike restaurants that mainly rely on walk-in traffic, catering businesses often operate on a contractual basis. This provides a level of control over your client base, allowing you to plan and manage your workload effectively. Building long-term relationships with clients can lead to repeat business, referrals, and a positive reputation within your community.
The rules and regulations for starting a catering business
Before starting your catering business venture, it’s important to have a good understanding of the rules and regulations governing the industry in the UK. Compliance with these regulations is not only a legal requirement but also ensures the safety of your customers and the success of your business. The good news is that the laws around catering companies are the same as they are for almost any other food business. Below are the regulations you need to adhere to if starting a catering company:
- You should register your catering company as a food business with your local authority at least 28 days prior to starting operations.
- You should either register as self-employed as a sole trader if you plan on running your catering company alone or register the business as a limited company if you plan on hiring other people as well as yourself.
- Ensure you and your staff are appropriately trained before you begin preparing or handling food. The law states that anyone working with food must be adequately trained in order to do so. While a food hygiene certificate isn’t mandatory, training for this is a great way to provide yourself and your staff with a good overall understanding of food safety, plus it shows food inspectors that the training has been done.
- You must keep detailed records of where you get your food supplies from and when, including receipts and invoices. This is part of food traceability, which is a legal requirement for any food business. You can find out more about it in the FSA’s food traceability quick reference guide.
- You must have a full list of ingredients available for your dishes and provide your customers with information on any potential allergens in writing.
- Your business should abide by general food law, which covers a variety of laws and regulations, including food traceability rules, import and export legislation, and food safety laws.
If you plan on supplying alcohol, you may also need an alcohol licence. This largely depends on the nature and details of the event. For example, if your catering business is supplying alcohol for a ticketed event which includes food and drink prices, a licence is mandatory. However, if for example, you supply alcohol to an employer for a work do and they do not charge their employees to attend the event, this does not require a liquor licence. Contact your local council if you are unsure as to whether you require one for your catering company, and read our alcohol laws guide for more information.
How to start a catering business from home in the UK
If you plan on catering from home in the UK, the regulations you must adhere to are largely the same as the ones listed above. However, there are a few extra considerations to take into account for your home catering business. One of the main additional steps you’ll have to take is to contact the local environmental health department to register your kitchen and request a visit from one of their officers. They will conduct inspections to ensure your facilities meet the necessary health and safety requirements for food preparation. From their inspection, they can advise you further on areas you may need to improve on, such as waste management, which is a common concern for home food businesses. You should contact the environmental health service before starting your catering business.
If you don’t own your home outright, you should also get permission from your landlord or mortgage holder before running your catering company from home. If your request is approved, you may also want to request amending your tenant/mortgage contract to reflect this to ensure you have this agreement in writing. Other authorities to notify include the local council, and potentially the local planning office if you plan on expanding your current kitchen or building a new one from scratch.
Finally, you should also take a look at your current insurance policy. Your home insurance likely won’t cover you for any accidents or damage relating to your business equipment, even if it is in your home. Fortunately, this can easily be fixed, as you can either purchase business insurance separately or buy combined home and business insurance to ensure you have comprehensive cover.
8 steps to setting up a catering business
If you’re ready to take the plunge and start a catering business of your own, you’ll no doubt want a detailed plan of where you go from here. To help you get started, we’ve put together a handy eight-step plan for setting up your catering company.
1. Make sure the business is viable
Before delving into the logistics of setting up your catering business, it's crucial to conduct a thorough viability assessment. This involves researching the market to understand the demand for your services, identifying potential competitors, and assessing the overall feasibility of your business idea. Key considerations to make when researching this include:
- Market analysis: Conduct in-depth market research to identify your target audience, their preferences, and the competition in your area. Understand the demand for catering services and the specific needs of potential clients.
- Competitor analysis: Analyse the existing catering businesses in your area and identify their strengths, such as good customer service or a choice of unique dishes, and weaknesses, such as having a poor quality website or a limited food offering. Use this information to determine how your business can differentiate itself to attract clients.
- Feasibility analysis: Assess the financial viability of your catering business. Here you should consider your start-up costs, operating expenses, and predicted revenue and profits. A well-researched feasibility study will help you make informed decisions and set realistic goals.
2. Find your niche
The catering industry is vast, and finding your niche can be instrumental in setting your business apart. The good news is that there is a whole range of catering business ideas to choose from, so you’re sure to find the perfect fit. To help you figure out your precise niche, consider your own strengths, passions, and the unique aspects of your culinary skills. Your niche could be based on any of the following:
- Cuisine specialisation: Focus on a specific cuisine that aligns with your expertise and interests. Whether it's gourmet, fusion cuisine, or cuisine from a specific country or region, a distinct culinary style can attract clients looking for specialised offerings.
- Dietary specialisation: Consider catering to specific dietary preferences or restrictions, such as vegetarian, vegan, gluten-free, or organic options. This can appeal to a niche market and broaden your client base.
- Event specialisation: Tailor your services to specific types of events, such as weddings, corporate functions, or private parties. Specialising in particular events allows you to hone your skills for a specific clientele. However, if you’re new to the industry and looking to get as much catering experience as possible, you may want to choose a broader niche. As well as giving you experience with a wider range of clients, this will also ensure that work stays consistent all year long.
3. Create a catering business plan
A comprehensive catering business plan is the foundation of a successful venture. Not only does it serve as a roadmap, guiding your decisions and providing clarity on your business objectives, but it is also a necessary step if you plan on securing external funding. Your business plan should include the following elements:
- Executive summary: At the beginning of your catering business plan, provide a concise overview of your catering business, your premises, and your key goals and objectives.
- Business description: Next, write up a more detailed description of your catering business concept. Outline the services you plan to offer, your unique selling points, and the values that will define your brand. Here you should also include the types of events you plan to cater for and your target market.
- Market analysis: Research the current state of the catering industry in your area to identify the strengths and weaknesses of your competitors, industry trends, and potential gaps in the market your venture can fill.
- Organisation structure: Outline the structure of your catering team, roles, and responsibilities, emphasizing relevant skills and experience. This will only be a short section if you plan on running the business single-handedly.
- Products and services: Here you should specify the range of catering services you offer, including sample menus and any unique selling points that set your business apart.
- Marketing and sales strategy: A good marketing strategy is key for any business. Describe your marketing approach, detailing how you plan to attract clients and promote your catering services.
- Financial projections: Provide detailed financial forecasts, including startup costs, revenue projections, and break-even analysis. This is especially important if you plan on securing funding for the business.
- Funding requirements: If you’re looking for external funding, clearly state how much you need to get your catering business up and running, how you plan to use it, and the expected return on investment.
- Regulatory compliance: Ensure that your plan includes information on the rules and regulations for catering businesses, including any licenses or registrations required to operate legally.
- Risk management: Prepare for anything that may be thrown at you by addressing potential risks and outlining strategies to mitigate them.
- Operational plan: Last but not least, include a detailed prediction of day-to-day operations, from sourcing ingredients to food preparation and delivery, highlighting key suppliers and logistical considerations.
4. Choose your premises
Deciding where to operate your catering business is a crucial decision that depends on various factors, including your budget, business scale, and local council regulations. The three following options are some of the most popular for catering companies:
- Commercial kitchen: Renting a commercial kitchen is a common choice for catering businesses. This option provides a dedicated space equipped with ample storage, cookers, hobs, and fridges. It is often the most expensive option, but also the most convenient.
- Home-based kitchen: If your local council and landlord/mortgage provider permits, starting your catering business from home can significantly reduce start-up costs. However, it's essential to ensure your home kitchen complies with health and safety standards.
- Shared kitchen space: If you can’t have your catering business kitchen at home but you’re looking for a cheaper alternative to your own commercial kitchen, you may be able to find a shared kitchen space that hosts multiple businesses.
5. Set up your kitchen
The efficiency and functionality of your kitchen and cooking equipment are of course paramount to the success of your catering business. Whether you're using a commercial kitchen or setting up at home, consider the following aspects:
- Appliances: Invest in high-quality kitchen equipment and appliances suitable for professional catering needs. This includes larger appliances like industrial ovens and refrigeration units, as well as smaller ones such as food processors, dehydrators, stand mixers, thermal mixers, and stick blenders. Ensure that all of your equipment is well-maintained and meets safety standards.
- Cookware and kitchenware: You shouldn’t underestimate the importance of good quality cookware, bakeware, and kitchenware The right baking tools can elevate the taste of your food, while reliable can openers, portioners, and utensils can make your kitchen as efficient as possible.
- Storage facilities: Adequate storage is essential for maintaining a well-organised kitchen. Implement proper storage solutions for ingredients, utensils, and prepared dishes, in the form of GN pans and ingredients containers.
- Layout and organisation: You should design an efficient kitchen layout that helps you and your kitchen workers to operate as smoothly as possible. Organise your kitchen space logically, with designated areas for food preparation, cooking, and storage.
- Hygiene and safety protocols: Establish strict hygiene and safety protocols in your kitchen. When planning your catering business set-up, this includes implementing proper waste disposal practices and ensuring that cleaning supplies are in an easy-to-access area.
6. Create a sample menu
While catering businesses don’t traditionally have fixed menus, a sample menu is important as it shows your customers the kind of dishes they can expect when they order from you. Consider the following tips when creating your sample menu:
- Culinary expertise: Showcase your culinary expertise by featuring dishes that highlight your skills. Consider your niche and the preferences of your target audience when developing the menu.
- Diversity: Include a diverse range of dishes to cater to different tastes and dietary preferences. Offering a variety of options increases the appeal of your catering services and makes your business more attractive to a wider range of clients.
- Seasonal considerations: Be mindful of seasonal ingredients and trends when designing your menu. Seasonal dishes not only reflect freshness but also allow you to take advantage of cost-effective produce.
- Special occasion dishes: You may want to consider creating some sample menus to have on hand for special days or periods, such as a festive sample menu, or one for Easter or Valentine’s Day events.
7. Register your business
Registering your catering business is a legal requirement and an essential step towards establishing your brand. This includes registering your business with the local council, registering as a self-employed sole trader or as a limited company, and registering with environmental health.
8. Market your business
Effective marketing is crucial for success and growth when you start a catering business. As well as attracting new customers, this is an important task for retaining regular clients. Plan and implement a thorough marketing strategy which includes both online and offline advertising. Below are a few of the most effective ways to market your catering company:
- Professional website: Develop a professional, user-friendly, and SEO-friendly website showcasing your catering services. This should include high-quality images of sample dishes, a detailed sample menu, contact information, and any client testimonials.
- Social media presence: Establish a strong presence on social media platforms such as Instagram, Facebook, and Twitter. Sharing engaging content, including photos of your dishes, behind-the-scenes glimpses, and updates on upcoming events, can help people learn more about your business and show customers exactly what you have to offer. If you plan on catering for corporate events, you may also want to create a strong and active LinkedIn profile.
- Online advertising: Consider online advertising options, such as Google Ads or social media ads, to reach a wider audience.
- Collaborate with event planners: A particularly effective method for getting repeat business as a catering company is by building partnerships with local event planners, wedding coordinators, and venues. Collaborating with professionals in the event industry can lead to referrals and opportunities to cater high-profile events.
- Participate in food events: Attend local food fairs and catering expos to showcase your offerings. This provides exposure to potential clients and allows you to network with others in the industry.
- Positive reviews: Any business owner knows just how important reviews are for the success of a venture. Positive word-of-mouth can be a powerful marketing tool and contribute to the credibility of your catering business, so encourage satisfied clients to leave reviews and testimonials.
Starting a catering business is an exciting and rewarding venture. By understanding the nuances of the catering industry, adhering to regulations, and following a systematic approach to business setup, you can establish a successful catering company of your own. Whether you plan on catering for grand events or offering bespoke services for intimate gatherings, the information on how to start a catering business in this guide can help you take the next step in your journey.
We’ve got the essential equipment you need to start your catering business here at Mitchell & Cooper, whether you’re setting up at home or in a commercial kitchen. From appliances and storage solutions to cookware and kitchenware, we’ve got the premium quality tools you need to make your business a success.
Looking for even more tips and advice for navigating the hospitality sector? Read the rest of our guides for more informative content, including our guide to creating a more sustainable restaurant, our dehydrator buying guide, and more.