Think your culinary skills are a cut above? Do your friends often tell you that you could be the next Gordon, Jamie or Nigella? How about turning your passion for food into a full-time business you can run from home?
Starting a food business from home could be the beginning of a satisfying new career. And a very lucrative one at that.
The UK catering sector is worth £1 billion. But, more to the point, it’s one of the very few industries that isn’t dominated by a handful of big companies. This makes it one of the best small business ideas you could try in 2019 because getting a foothold in the market isn’t as hard as it can be in other industries.
Here’s a look at how to get started setting up a food business from home in the UK.
To start a food business from home in the UK, you need four things:
Many successful entrepreneurs recommend specialising or niching down to succeed. And, with 5.7 million small businesses currently active in the UK — 186,000 of which are in the food business — it’s not hard to see why. The idea is that if you build your business around a specific theme, it’ll be easier to become known.
It not only applies to food businesses but for any business. Entrepreneur Judge Graham puts it this way: “...only by homing in on a niche can you be unique and stand out within your industry. You simply cannot be a generalist anymore.”
The question is, what should you focus on? How do you find the right niche for your food business?
Here are a few tips to get you started:
Thinking of asking your bank for a loan to finance your business? You’re going to need a business plan. Outline of your vision will show the bank how you’re going to make it profitable. Which is crucial if you want to convince them lending you money is a sensible decision.
That said, it’s still worth writing a business plan even if you’re going to pay startup costs out of your own pocket. Your strategy will probably change over time as your business evolves. But having one in place from the outset will help you:
The Prince’s Trust has business plan templates and a business-plan pack — complete with financial tables — that you can download for free. It’s also worth looking at a few business plan examples to get a feel for how they’re written. Bplans has over 500 free business plan samples.
And when you sit down to put your business plan together, do keep the following in mind:
Yes. You have to apply for food premises approval if you carry out food operations at home. This is also known as food business registration.
Food operations include:
You’ll need to get a licence for any premises where you carry out food operations, even if they’re temporary. So, if you prepare food at home and sell it from a stall at the local market, you’ll need a licence for your home and a licence for your booth.
To apply for food business registration:
Alongside your licence, your local authority will also inspect your kitchen regularly to make sure you’re following food safety laws. In particular, they’ll:
Handle fish, meat, eggs or dairy? You may also need to get special approval.
As a rule, you DO NOT need to get special approval if:
That said, it’s up to your local authority to decide. And they may require that you get special approval even if you satisfy these requirements.
Running a food business without the right approvals is a criminal offence, so it’s probably best to ask. Better safe than sorry.
On a note that’s unrelated to food, you’ll also need to register your business with HMRC. We’ll get to this in a minute.
No. As surprising as it sounds, you don’t have to have a specific certificate to run a food business from home.
By law, you must be able to show the authorities that you know how to handle food safely. But a formal qualification isn’t the only way to do this. You can also satisfy this requirement by showing you’ve had on-the-job training or learned through previous work experience.
If you enjoy spending time in the kitchen, you’re probably already aware of food hygiene standards such as the 4Cs. The 4Cs are:
That said, the best way to make sure you’re in line with the law is to take a formal training course. Most people who work in professional kitchens opt to take a Level 2 food hygiene course. This covers:
You can do an accredited course in one in a day for as little as £10 plus VAT. And while you’re at it, you should also brush up on food law in the UK. The Food Standards Agency has a guide that covers general food law basics.
Alongside your special licence, you’ll also need to register your business with HMRC.
Before you do this, you’ll need to decide whether you’re going to do business as a sole trader or limited liability company.
Limited liability companies have certain tax and legal benefits, but they’re also more expensive to set up and run. For most new businesses, registering as a sole trader is easier, quicker and cheaper. You can always incorporate at a later stage.
To register as a sole trader:
Well, this depends on what type of food you’ll be making.
If you spend a lot of time in your kitchen, chances are you already have the necessary equipment you need to get started. That said, do keep in mind that, as a business, you’ll be cooking a lot more than you do now. For this reason, it’s worth doubling down on the tools you’ll be using most often, such as:
As your business grows, you’ll want to invest in professional-grade equipment that’ll help you meet the increased demand for your goods more efficiently. You may be able to deduct some or all of the money you spend on this Equipment from your tax bill by claiming capital allowances.
Alongside kitchen equipment, you’ll also need tools to handle the business side of things. In particular, you might want to look into:
And there you have it. With a good idea, a solid business plan, the right licences and the right equipment, you’ll be well on your way to setting up a successful food business you can run from home.
Now, time to fire up that stove and get cooking.