“I could do that: only better…”
If this is what springs to mind whenever you’ve eaten at an event then the chances are that you’ve toyed with the idea of starting your own catering business. There’s just one problem: you love food, but hate red tape. Sadly, we’re short on cooking tips. Instead, we’ve aimed to break down what’s actually involved in going it alone and starting your dream catering business.
Starting up: what to think about
Do your market research
Is there a market for what you propose to offer? Fieldwork is key, if possible, get talking to caterers who are already out there, compare their menus and pay particular attention to their pricing. Then ask yourself: can you compete? For instance, if you are aiming at the wedding market look out for wedding fairs in your area ask questions and get a feel for what potential competitors are offering.
For corporate work, many caterers first build up a relationship with the customer by becoming a favourite for the daily lunch run, before being trusted with much bigger client-focused events. You might suspect what you have in mind will go down well with the lunchtime crowd, but how can you be sure? Go in and ask who you’re targeting if they’re keen for what you’re offering, preferably before lunch.
Can you do it from home?
Yes, although when it comes to preparing food for the public the same basic laws concerning food safety apply to domestic and commercial premises. We’ll look in more detail at these requirements below, but from the outset, you’ll need to consider whether your home kitchen is physically capable of meeting those requirements.
Also, be sure to consider the wider implications of combining a workspace with a family kitchen. Think carefully about whether work and family life will be able to co-exist in the same space.
Consider costs from the outset
Your market research should tell you who your likely customers will be, what they want to eat and how much they are willing to pay for it. Next, you have to calculate whether you’ll be able to deliver this and still generate a profit.
Fortunately, catering businesses tend to be scalable. This means that you can start small with minimal outlay and invest later to increase your capacity once your customer base grows. Price-up equipment and pay close attention to replenishment cycles. For instance, how long it is likely to be until you need to replace that equipment. For produce approach local suppliers and shop around for the best prices. It’s worth selling yourself here and if a supplier sees that you’re serious he’ll be keen to establish a relationship.
Get to grips with essential food safety requirements
Notwithstanding the legal requirement to take food safety seriously it also makes good business sense.
Your potential customers need to know that they are in safe hands and for many this will mean checking your score under the Food Hygiene Rating Scheme (FHRS). Local Authority Environmental Health Officers inspect all food businesses (including home-based caterers). They will check if you are meeting hygiene standards and will issue a 0-5 star hygiene rating. Your rating is searchable online. From the get-go, this is one area where you can compete and achieve parity with the ‘big boys’.
When starting your food business you must register with your local authority, who will then arrange an inspection, so it’s important you go to your council’s website to find out their procedure for this. The emphasis is on practicalities, including cleaning, storage and pest control. The Food Standards Agency website gives a useful rundown of what new businesses need to cover. A basic hygiene training course could prove to be invaluable before you start. Offered by most further education colleges, these are geared at helping you work smart and safe, and to stop you falling foul of the inspectors.
Getting set up
Structuring and presenting your catering business in the right way
Presentation is all-important. It’s common for self-starters to commence trading as a ‘sole trader’. For this, you’ll have to register as self-employed. If you’re aiming to cater for business clientele you may wish to consider trading as a limited company, something that’s quick, inexpensive and relatively easy to arrange if you’re in the right hands. This can also be a wise move if you’ve come up with a catchy name for your business and you’re worried about someone else setting up a company with the same name.
Keeping track of everything
As your business grows so does that pile of invoices, receipts and supply orders. From day one get into the habit of good bookkeeping i.e. filing all paperwork in date order. This will make things a lot easier when it comes to sorting out your tax at the end of the year.
Want to know more about how smart small businesses deal with admin? Check out our help centre for more info.