Are you thinking of taking your culinary creations into edible commerce? But perhaps think that starting a food business is for “other people”? A home-based food business is a perfect way to start your journey and comes with tremendous benefits. Starting small can help you decide if being a foodpreneur is something you want to chase and turn into your legacy.
Setting up a commercial food business in your home may seem a daunting task at first. However, you may be surprised by just how easy state Cottage Food Business Acts have made getting into the commercial food industry without the full-scale start-up responsibilities restaurants require.
Below we will break down the best perks of realizing your culinary dreams from home.
The Advantages of Starting A Cottage Food Business
Low Barrier To Entry
Every home-based food business must comply with their state’s cottage food laws. This includes licensing, permitting, and hygiene regulations. These are generally straightforward and can be less rigorous for a home-based business depending on the area. Fewer start-up costs and legal requirements make a cottage food business an equal opportunity starting point for most foodpreneurs.
Less Capital Intensive
Setting up a full-scale restaurant requires a tremendous amount of start-up capital and potentially the involvement of investors. Instead, using space you already have can help save precious funds that can be reinvested into your growth instead of a landlord.
Additionally, you’ll be spending less on utilities, maintenance, and staffing required to run a brick-and-mortar operation. Items like utensils and cooking equipment can also be cross purposed.
Lower Liability
A home-based food operation allows you to operate with much less stress than a traditional commercial kitchen. For example, you likely won’t need to worry about employee insurance, costly maintenance, or risk an unexpected closure tanking your profits for the month.
Since your investment remains comparatively low, the risk quotient decreases compared to a stand-alone commercial food business. If something unexpected happens and you decide to take a break, you won’t have employees to lay off or a landlord banging at your door either.
Low Overhead and Operating Costs
Compared to the stand-alone commercial kitchen, the day-to-day operational costs of a home-based kitchen are appreciably lower. From utilities to rent, you’ll have less overhead to cover, and more profit can be made. Not only is the overhead reduced, but you also won’t have operating costs like POS systems, employee management software, or the wages of admin staff (like accountants and human resources) to cover.
You Can Scale As You Grow
As far as pressure goes, the ability to scale as you grow in a home-based food business is possibly one of the best advantages of running your commercial kitchen in-house. While starting a full-scale restaurant will mean that you need to be more or less fully stocked on opening day, a home-based kitchen means that you can scale as you grow.
You can level up your kitchen equipment and staffing needs as profits allow rather than spending money upfront. In addition, you won’t have to front the expenses of large volumes of packaging and ingredients until your customer base grows. It is a perfect solution for those with a food dream but without a millionaire’s bank account.
Tax Advantages
While you should consult your accountant, it is logical that you can claim many of your home-based business expenses on your taxes. For example, if your in-house commercial kitchen takes up 20% of your house, you should be able to make a write-off on your income taxes.
You can also receive tax deductions for expenses related to licensure and permitting. The same goes for marketing materials, website hosting, online courses, and vehicle expenses.
Flexibility In Concept
One of the best advantages of starting your foodpreneur journey with a home-based kitchen is that you can test the waters and modify your offerings with feedback. Instead, a stand-alone restaurant has a very slim margin of versatility as menus need to be printed with set offerings and ingredients need to be purchased ahead in large quantities. In addition, staff are trained to make specific recipes. Throwing new products into the mix will cause inconsistency, increased costs, and instability.
In a cottage food business, you have the benefit of testing products and friends, family, and even the local farmer’s market before you commit to a menu or product. Take advantage of this flexibility by hosting tasting events in your neighborhood or popping up at festivals to try out creations.
Finding a balance between your business and family can be easier in a cottage food business model.
Flexible Hours, Flexible Life
Finally, one of the most difficult tasks as a foodpreneur is establishing a work-life balance. Establishing a routine inside the comfort of your home and doing so early in the process will help you stay happy, passionate, and motivated.
Too often, entrepreneurs get sucked into the hustle. A busy week can turn into months that can turn into years where you’ve missed important life events and holidays to stay open as a brick-and-mortar business. Because, hey, the landlord, employees, and vendors still need to get paid.
A home-based commercial kitchen offers a somewhat more flexible routine with less impact if you need to take a day off. You can set your own hours, take feedback and make adjustments to offerings relatively easily, and every day is casual Friday. You also won’t lose precious time driving to the restaurant each day when you can just roll up to your in-house kitchen instead.
Conclusion
While there are also disadvantages to running a home-based business (you are essentially never able to leave your workplace after all!), we believe the pros outweigh the cons. Starting your foodpreneur journey in your home allows for a massive amount of flexibility and a faster approach to begin.
If you are still unsure if taking on a home-based food business is the right choice, consider touching base with fellow home-based food business entrepreneurs. Additionally, community forums are helpful to learn from those who have gone before you. If you want to make sure you are on the right path you can also connect with a consultant who specializes in helping home-based food businesses get licensed and comply with regulations.
The Top Five Questions About Starting a Home Based Food Business
Home Based Food Businesses Can Thrive If You Know The Secrets To Succeed
Suppose you’ve gotten countless compliments on your potluck specialty, been asked to make every kid’s birthday cake in the neighborhood, or everyone consistently votes to have dinner at your house. In that case, a home-based food business might be the vehicle to take your talent and passion to the next level.
While it is, by nature, a less start-up intensive business, a home-based or cottage food business still requires careful research and planning. While preparing your custom BBQ sauce for friends or catering an event on occasion can feel casual, running your food business out of your home involve the leveling up of your organization and operations.
Once you get your foundation in place, a home-based food business has many advantages and benefits. Check out more at The Perks Of a Home-Based Food Business.
Researching the laws and operating standards surrounding cottage food businesses can be time-consuming. So we’ve rounded up the top five questions commonly asked about home-based food businesses below so you can get to the fun part faster.
Do I need a business license or permit for a home-based food business?
Whether you need a business license for your cottage business depends on the requirements of your state. As you scale up, you’ll likely want one to formalize your operations. Most states require a business license or home-based business certificate, or both.
Here are just two examples of the differing requirements in California and South Carolina.
California
In California, you must also obtain the licenses and permits required of all businesses, such as a local business license as well as a food handlers permit.
You will need a permit from the county health department. A home-based food business can choose from two types of permits, depending on whether you want to sell products directly to customers or through other local businesses like shops or restaurants.
Class A permit. You can get a Class A permit in California if you want to sell only directly to customers within the state of California. For example, with a Class A permit, you can sell at farmers’ markets, festivals, from your home, or in other ways that allow individuals to purchase products directly from you. To get a Class A permit, you must complete a self-certification checklist, but there will be no physical inspection of your kitchen.
Class B permit. You need a Class B permit if you want to sell indirectly to customers – for example, through stores, restaurants, or other venues that will sell your products for you. In California, you may not sell indirectly outside of your own county unless the county where you want to sell has stated explicitly that they will allow indirect sales of cottage food products. To get a Class B permit, your kitchen must pass an annual physical inspection to get a Class B permit. (California Health and Safety Code § 113758 (2022).)
In addition, through the California Homemade Food Act, businesses ARE allowed to sell products online as long as they are picked up in person by the customer. Home-based food businesses ARE NOT allowed to ship food goods or cater.
South Carolina
Compared to California, South Carolina has a more flexible scenario for foodpreneurs. This state’s regulations do NOT require inspections, permits, licensing, registration, or a food handlers permit. However, a business license is recommended for taxation purposes.
Under South Carolina’s newly renovated 2022 Home Based Food Production Law, “home-based food production operations” can now sell items beyond shelf-stable baked goods and candy to include a wider variety or goods.
No retail food establishment permit is required as long as all production stays in the home space. Home-based food businesses are restricted to selling only to the end customer. New reform to the cottage food laws has opened up sales to restaurants and retail spaces, as well as farmer’s markets, roadside stands, events, and from home. (South Carolina Code § 44-1-143)
Additionally, you ARE allowed to ship and sell foods online in South Carolina as well as offer delivery and wholesale.
What information is needed to obtain a permit?
While this also differs from state to state and may or may not require an inspection, you will generally need to be prepared with these pieces of information. Even if not required, it is always better to be over-prepared for venue or retail-specific requirements.
ingredients and full recipes for all of your products
a complete list of sources for your ingredients
labels for each product
source information for your packaging
a floor plan of your kitchen work space
a list of your equipment, utensils, and food contact surfaces
a certificate showing you have completed a food handlers course
Do I need insurance?
Anyone turning their culinary passion into a profit-based model should ensure they are well protected against the risks associated with running a home food business. However, even though you are making food from your residence, this doesn’t mean that you are immune to the risks associated with working in the food industry.
Food Liability Insurance takes the prudent step to protect you from unforeseen accidents or events. Whether you run you are primarily selling at your local farmers’ market or sell your special recipe BBQ sauce out your back door, the cost of your food insurance policy is mainly driven by the size and scope of the food business you’re running. Food Liability Insurance typically costs between $300-$1300 annually, depending on differing variables from state to state.
Labelling requirements for cottage food businesses have reasonable exemptions through the FDA.
What kind of labeling do I need?
Thanks to the Small Business Nutritional Labeling Exemption, the FDA exempts “low-volume” products from needing to use barcodes or nutritional contents. To be considered exempt a home-based food business must:
Not have more than 100 employees
Sell fewer than 100,000 units annually
Have less than $50,000 in annual sales
File an exemption with the FDA annually
Online submissions for the exemption can be made here on an annual basis.
Keep in mind that each food app, venue, or retailer might have its own qualifications for labeling with higher standards.
Selling home baked goods to retailers is possible through Cottage Food Business Laws
What kinds of goods can I sell in my cottage food business?
Can you sell beef jerky, fermented foods, and hot food? The answer is a predictable one by now; it depends on the regulations of each state. Forrager has a great resource for all 50 states that cover the foods that are allowed, controlled, or strictly prohibited. Their directory also includes valuable information about where you can sell in each state, if and how you can deliver, and limitations for the cottage food industry.
For example, Colorado will allow the sale of some “potentially hazardous” foods, like fermented sauerkraut, while South Carolina allows only baked and confectionary goods. Baked goods are the sweet spot of the cottage food industry with every state allowing for the sale of some type of sweets.
However, while some states will allow the sale of artisan cookies, they may not allow banana bread due to moisture content and shelf stability. There are exceptions to these rules. Special permitting may satisfy separate home-based food laws. For example, in Ohio, you can apply for a special “Home Bakery License” that allows for potentially hazardous baked goods like cheesecake and dairy-based foods. Where there is a will, there is a way!
Here are several other resources to check your state’s cottage food allowances for different types of food.
Starting at home is a great way to build a proof of concept for the big market with less financial risk and time investment. Not that the cottage food business is an easy street, however, there is just an ease of entry into the foodpreneur market that doesn’t exist in brick-and-mortar situations.
Starting small will help build your audience and allow you to scale up organically as you find success. Check out our other articles in the Grow Your Food Business Series on where to start!
How defining your purpose will help your food business define its values, create momentum, and become the ultimate touchstone for longevity.
Defining your brand’s purpose is an essential starting point for creating your brand story. While everyone’s story will be different, and the way you tell your story can take on various forms, your unique brand story should be anchored in your company’s purpose. Check out Grow Your Kitchen Series: 5 Steps To Creating Your Brand Story for more on how to build a compelling brand story.
A purpose statement will inform your brand story. It is a succinct description of why you exist beyond financial gain. Are you making your community healthier? Are you introducing authentic international flavors to an otherwise bland food desert?
The Harvard Business Review reports that companies with a defined sense of purpose can foster better employee satisfaction, facilitate business growth and transformation, and boost customer loyalty. Your Purpose Statement will provide a guiding compass to your business internally and a representation of your values and mission to the public externally.
What Is The Difference Between A Purpose Statement and A Mission Statement
When you are starting a business, you are inundated with different terms that are needed to create pitch decks, internal guidelines, and marketing copy. Your mission, vision, and purpose are all separate parts of creating a focused foundation and roadmap for your food business.
Many people confuse Mission, Vision, and Purpose Statements. Here are the key differences:
Mission Statement: This statement is about what you do and for whom.
Vision Statement: This is where your food business is going is goals and intentions are accomplished.
Purpose Statement: The intent of a Purpose Statement is to define the reason or reasons you exist as a business.
Your Mission and Vision Statements will be the tangible goals and people that you serve. Your Purpose Statement will tie this all together to show your resolve and determination is seeing your mission and vision through.
How To Create A Purpose Statement
Deep diving into your company’s morals, ethics, and beliefs will help you define your purpose. You will often find your purpose organically by asking yourself and your employees:
“Why are we here?”
“What problem do we solve?”
“What movement are we championing?
In the food world, this could be that you are championing the slow food movement where everything is prepared fresh from local farms.
Maybe you are solving a gap in the market where your community has no authentic Asian cuisine.
The problem + your solution = your purpose.
The Five Steps To Creating a Purpose Statement
When crafting such an essential piece of your company’s foundation, it might seem hard to hone in the perfect concise purpose statement. It takes time to create a purpose that perfectly captures your food business’s essence. Here are a few things to keep in mind.
1. Consider Forming A Committee
This doesn’t have to be a formal group, but of course, it can and should include stakeholders when suitable. A committee can be a group of close friends and like-minded business people who know you and your goals and can help you define your purpose.
2. Figure Out Your Why First
You can refer to Finding Your Why to inform your purpose. Your “why” is the reason you decided to open up your food business in the first place. It is the excitement that keeps a foodpreneur up late at night dreaming, and it is essential to be able to describe the motivation behind your purpose.
3. Identify Your Legacy
Identifying your legacy is a good exercise to put you in a purposeful frame of mind. The description of your purpose should be informed by what your future impact looks like. Knowing what you want your legacy to be and working backward will help you develop your core purpose.
4. List Your Values
In listing your values, you will find some of the most critical vocabulary that will become the words you use for your purpose statement. Your values will help you align with your purpose.
5. Create A Draft and Leave Room To Grow
Once you have collected feedback from a trusted group, listed your values, determined your ‘why’, and identified your future legacy, it’s time to create a draft. Try to keep your Purpose Statement between 1-2 concise sentences. Also, aim for easy-to-understand vocabulary and a tone that matches your audience.
Remember that your business will evolve, and your Purpose Statement might as well. Leave room for growth.
Examples Of Purpose Statements
Here are a few examples to fire up your creativity in creating your own Purpose Statement.
Campbell Soup: Real food that matters for life’s moments.
QR Codes are the versatile best friend of your food business.
Somewhere between “life was very normal” and “what is COVID and how will I ever eat out again” QR codes started to seep into our everyday lives. What was once a mysterious-looking digital square that we regulated to something only “the young people” used has now become eponymous with dining in, takeaway, and delivery of our food.
Maximizing The QR Code In Your Food Business
Since their surge of use in 2020, when contactless food ordering became a real thing, we now use QR codes regularly as consumers and food business owners.
How Does A QR Code Work
As a consumer you are likely pulling out your phone to look at a digital menu, check a restaurant’s website for information, or get directly linked to social media account to follow a business that you have become a fan of.
As a food business owner, you encounter QR codes for administrative tasks like reordering supplies or even accessing a time clock system for your employees. However, QR codes can be instrumental in gathering information to determine your target audience and their habits and to foster engagement with the community. More on that below.
First, how does a QR code work? A QR code (short for Quick Response Code) is a type of matrix barcode that was the product of a Japanese automotive company in 1994. It is a machine-readable pattern that contains information attached to an item, website, or application.
Why Use QR Codes
Although it started with the automobile industry, QR codes are now part of everyday convenience that anybody with a smartphone can access.
They are also easy and often free to generate on the business’s end. Every restaurant, food truck, and food delivery service should begin to utilize QR codes for the vast potential they offer to both the business owner and consumer. Below we pitch our case to generate your first QR code.
1. Positive ROI
Using QR codes in your business can provide a high return on investment (ROI). Of course, using a free generator is going to give you a great return (although without an added layer of security) while those with small monthly fees are well worth the return of analytical insight they provide.
2. Analytics
Perhaps the most important thing a QR Code can do for your food business is providing you with organic information about your audience; who they are, when they shop, and what they buy. Every scan whether it’s to find your store hours, your location, or to view a promotion, has the potential for you to absorb and utilize information for business.
3. SEO
Using QR codes can enhance both your social media and search engine optimization (SEO). When you increase traffic to searchable objects, you can optimize them by encouraging even more sharing which will ultimately create a snowball effect with the algorithm for people who search for services like yours.
4. Customer Efficiency
Print media, such as flyers, and brochures, may have a direct link to your contact and social media but can also get lost. Tying your physical marketing materials with a QR Code means that you won’t have to worry about your potential customer remembering or writing down information incorrectly. When it’s scanned, prospective customers can be taken straight to your landing page.
Five Ways To Use a QR Code For Your Food Business
Knowing how to integrate QR codes into the daily functions of your food business can help streamline both front and back-of-house operations. Here are five easy ways to integrate QR Codes to elevate your food business game.
1. Connect To Your Website
Every opportunity to route a potential customer back to the hub of your business should be taken. A QR code on a menu, marketing materials, business card, or even a sticker that makes it easier for customers to find you will be a win for exposure and organically convert to more business.
2. Connect To Your Menu
The simplest way to do this for a dine-in restaurant or a food truck with long lines is to put a QR Code in a strategically visible place to allow people to browse your offerings from their phones. This cuts down on printed menus and time when people have the opportunity to look at the menu before ordering. In addition, placing a menu QR Code on marketing for your home delivery service or catering will make it easier for customers to find you if you are not serving from a brick-and-mortar establishment.
QR Codes can also help provide additional information about ingredients or special processes on the packaging. If you are a delivery service, this is a great opportunity for customers to find out more about special health benefits or seasonal specialties with a scan that will lead them to an information page.
3. Make Payment Easier
We are quickly on the road to being a cash-free society, and QR Codes are making spending easier than ever. It is estimated that by 2025 more than 30% of all transactions will use QR Codes to complete payment. This a great way to facilitate APP-to-APP payment (from customer bank to your payment platform) and reduces the time and resources needed to manage in-person cash payments. Having a bespoke payment QR Code is especially handy if your food business is cloud kitchen or delivery based.
4. Promotion or Contest
A QR Code is a great place to create buzz and connect promotional deals, sales, and other special offers that activate when a customer scans the QR code. In addition, your food business can receive valuable analytics about your consumers.
5. Call To Action
You want visitors to your website or those who view your marketing materials to convert to loyal customers, so why not use QR codes as a call to action? This is the perfect opportunity to link them to a ‘call us’ or ‘email us message so that people can instantly get in touch. This is also a great opportunity to link people to ‘how it’s made’ videos or direct them to social media.
QR Code Resources
There are many free QR code generators online that are easy to use and customize. The fee-free versions sometimes come with a watermark, but they are often discreet.
There are also paid versions that will allow bespoke customizations such as shape, color, and look. These versions can have a yearly fee but will provide the option for you to add your own logo and have access to analytics. Finally, a paid QR code will get you an added layer of contactual security. There is some risk associated with not having total control over where your QR code is directed and a paid version insures against this risk.
Here are a few great resources to generate a QR Code.
Sprout QR
Sprout QR is a paid service (starting at $10/month) that will protect your data and your links. They also offer customer service and professional design.
BeaconStac
BeaconStac offers both free and paid versions of QR code generation services. They offer a deep dive into analytics that will tell you who is scanning and when. Paid versions start at $5/month.
QR Code Monkey
Qr Code Monkey is one of the most popular free QR Code generators. For a free version, it is highly customizable with areas to change the look, color, and logo placement of your unique QR code. With the paid version, you can add folders and a customizable analytics dashboard.
Scanova
Scanova is one of the most comprehensive QR code services available. You can generate QR codes that can link to websites, PDFs, or even geolocations to optimize their use in your business. In addition, Scanova will allow you to create a basic mobile landing page.
The Ultimate Checklist For Starting A Catering Business
For many entrepreneurs who want to dip their feet into “foodpreneurism,” going all out with a full dine-in restaurant may seem daunting. However, a private catering business is the perfect intermediary step to test the waters, work out your menu, and build your reputation in the local food world.
Catering has become an umbrella term for many food hustles, including private events, regular pop-ups, or even a weekly stand at the Farmer’s Market. Catering is the perfect entry point into a food business for those with entrepreneurial dreams but without the hefty initial investment or desire to swing full-time kitchen life.
Benjamin Franklin once said, “If you fail to plan, you plan to fail.” From that wisdom, we have created the Ultimate Checklist For Starting a Catering Business.
Why Start A Self Catering Business
After COVID shook the food world to its foundation, many people gravitated towards a food business model less susceptible to unforeseen changes. As a result, catering businesses saw a 5.5% surge in 2022, which amounted to over 30 000 individual catering operations in the United States.
Running your private kitchen or catering service can have a lot of benefits over other types of food business models.
They have versatility. Menus, hours, and offerings can change as the business evolves.
You can make your own hours. Anyone in the restaurant industry will tell you there are no weekends and few holidays in a brick-and-mortar business.
Lower liability. While catering liability insurance is a good idea, you won’t have to worry about the regular maintenance of a standing restaurant.
Low overhead costs. Depending on where you operate, you might have little to no rent. Ditto for utilities and
Low initial investment. The money needed to start a catering business is relatively minimal at the beginning, and if you reinvest your profits wisely can be built as you grow.
Can be extremely lucrative. Due to the minimal overhead, low staffing needs, and fewer middlemen, catering can have big profit margins.
Opportunity for creativity. Catering offers a great way to stay creative with custom or seasonal menus that can change as you learn and grow. By comparison, a restaurant menu needs to stay more or less the same to reduce logistical hassle and to maintain tight margins.
Finally, catering or running a private kitchen can be a much more intimate experience than running other types of food businesses. You have the opportunity to work closely with people to create bespoke menus and be part of setting the ambiance for special events. It allows you more personal access to the community and a genuine opportunity to create connections.
So what do you need to know before you jump into self-employment and start your catering business dream? We’ve created the ultimate checklist to consult before your first gig.
The SAPi Self Catering Business Eight-Step Checklist
The Eight-Step Checklist To Start Your Catering Business
1. Do Your Market Research
The first and most important step to founding your self-catering business is complete due diligence on the market’s potential. This means studying the competition, examining gaps in the market, and comparing pricing. Of course, you don’t want to enter the market blindly, against obvious competition, or by outpricing yourself. You don’t want to walk into an oversaturated plan unless you are looking to disrupt the market.
Before you move on to the next step of opening your catering business be sure to know:
Competition
Pricing
Targeted customer base
What food niches or services are underserved
2. Draft A Business Plan
Unfortunately, just being known for your food quality and reputation are not enough to create a sustainable business. Drafting a plan from the start is imperative to understand what is ahead and to create a long-term strategy. Failing to plan can land you in difficult situations without the tools to recover.
Part of your business plan will be the market research you have already done. In addition to having proof of concept, an idea of your audience, and an understanding of your competition, you’ll need to develop a roadmap. This should include the following:
A mission and vision statement.
Your unique value proposition.
A twelve-month budget of expenses and projected income.
A plan to reinvest profits into growth.
Funding plans.
Menu with cost-out projections.
A marketing strategy.
A note on setting your business budget and projected costs. Entrepreneur Magazine estimates that self-catering business start-up costs can run anywhere from $10,000 – $50,000, depending on the scale of your project.
Don’t let this discourage you if you are cash-strapped. There is a great ability to make a good profit margin with a catering business and you can invest in your equipment inventory as you go. In addition, you won’t necessarily need a commercial space to rent. However, you may also be able to finance a self-catering business for much less than $10,000. If you are bootstrapping and light on start-up cash, consider applying for a small business loan or looking for investors – in which case a complete business plan will be a necessity.
3. Draft a Menu and Set Pricing
Start with a rough draft menu of signature items that you have a proof of concept for – and had good feedback from. Then, build on those items with dishes that meet an unfulfilled niche or can compete with what is already in the market.
Ensure that the menu has ingredients that can be regularly sourced and can meet your price point. For example, avocados as a year-round ingredient can be difficult to source and have a fluctuating price point.
For catering, consider a customizable menu with multiple options and price points for different packages. Set pricing that is within the range of market competition that also meets the needs of your profit margin. Pricing is a science and something that can be difficult to change after creating a loyal customer base.
Lastly, you’ll need to address a minimum order quantity and lead time. This should reflect the speed at which you can procure your ingredients from suppliers and the minimum order quantities they require. You’ll also need to make sure that the total order value is enough to cover your costs. This can include staff, set up, breakdown, and other variables.
4. Get Legal; Licensing, Insurance, and Permits
You will need to check your local requirements. However, most states require any food business to obtain a business license, insurance, and potentially permits.
Licensing will come with the formal incorporation of your business. In addition, you may need liquor licenses, health and safety, and food handlers permits. Venues you service may cover part of these requirements.
Business insurance is imperative in protecting your catering company in the case of the unexpected. It is not only wise to protect your assets and shield you from being sued, but it may be mandatory.
Furthermore, there are several kinds of small business insurance, the most common being general liability coverage. Other types of coverage you might consider are commercial property insurance, business interruption insurance, employee insurance, and personal liability.
Before you launch your self-catering business, investigate the licenses, insurance, and permits you’ll need with the United States Small Business Admistatrative services.
5. Make An Equipment List & Budget
You won’t have to start with much to launch a self-catering business. The great thing about having flexibility is that you can start small with the equipment and materials you have and scale as you grow. It is helpful to create a complete list of what you have (your assets), what you will need to start, and what you have on your wishlist as you grow.
No need to worry about buying everything new. Checking resellers like Craigslist for second-hand commercial equipment can be very cost-effective. One of the secrets to any food business start-up is to look for restaurants that are scaling their equipment and want to unload their older kitchen goods or even a business that is closing and clearing out. This can lead to great deals on normally expensive commercial equipment.
6. Plan & Execute A Marketing Strategy
Word of mouth is an invaluable touchpoint of marketing, but it won’t be enough to gain elite status. Fortunately, there are many strategies you can employ as a self-catering business to get the word out.
Decide where and how you want to spend your marketing budget. Set a monthly plan and adjust as you see what is working and what is not. Social media presence is imperative in modern times and if you aren’t savvy, hire someone who understands your goals and brand aesthetics to make regular posts to show that the lights are on and you an active business.
In addition, to considering where and how you want to market, you can do several other things to gain momentum and build traffic to your business.
Invite reviews and engage with your commenters.
Give a real-time look at your business with regular photos and videos of events.
Get personal, invite people into your business to see how things are made, and meet your team.
Engage, engage, engage! Create conversations on your and other local social media sites.
Encourage your friends and happy customers to spread the word and photos of your events and signature dishes. The opinion of others is possibly the most important free marketing you can get.
7. Create A Staff List
Creating your team is imperative. Even if it is just family to start, you should know who is available and when. Catering is usually geared towards weekends and evenings. Strategically speaking, you will need people who are available during these peak times and are alright with part-time hours.
Keep a primary list and backup list of available people. The worst scenario for any catering service is that you have the opportunity but not the staff to execute the event. In addition, consider potentially training staff on evenings when you don’t need their manpower so that they are ready to be called up for future events.
8. Plan Your First Gig, Contact Potential Venues
Your first professional gig when you are launching a catering business is crucial. Many people find it more relaxing to promote your business with an event that will have a friendly audience of people they know. Think about hosting an event with friends to get the word out, get great marketing photos, and spread word of mouth about your services.
Self-catering means that you will often be at venues for the first time. Be sure to check out the facilities well in advance. When doing a site check, take notes on entrances for loading, kitchen amenities if any, on-site equipment and electricity, and available staging items (like tables).
Lastly, if you want to spread your services to launch regular pop-ups, make connections with weekend markets and event promoters. Send them a menu or sample dish to engage them with possible partnership opportunities.
