2020 has been a turbulent and unsettling year but with lockdown forcing us to take a breather, it has also has been the prime time for self-reflection and development. With many finding comfort in the kitchen during these uncertain times, cooking skills have sharpened and for some, a hobby has turned into a career!
In addition to new food businesses blossoming, some catering and hospitality workers have changed their business model by transforming their own kitchen into a delivery kitchen, allowing them to operate food delivery businesses from home.
Starting a business can be daunting and overwhelming (even from the comfort of your own home); there is a lot to consider and do before you even start producing food from home. We’ve covered all the essentials needed for starting a home-based food business and tips for scaling up.
Benefits of Setting up a Food Business from Home
- Low cost
- No limit to your creativity
- Flexibility: the ability to create your own working schedule
- Running a business from the comfort of your own home
Starting a Food Business: Checklist
Construct a Business Plan
First things first; create a business plan. Having a business plan helps you set achievable goals and milestones and is proven to help your business grow 30% faster. It makes you think about what you want your business to be, where you see it going, and what you want to achieve from it. It will help you set out your objectives for your home-based food business. It will also help you to prioritise your next steps:
- Who is your target market? The market research you do will influence how you market your product and interact with your customers.
- Do you have a unique selling point? Where do you draw your inspiration from? What types of foods do you use in your cooking? Ensure these points are reflected in the design of your product, as this will boost sales.
- Where do you want to advertise your product: local markets or selling online? Research the best places near you and which online marketplaces are most suited to your target audience.
Register your Business
Once you have a working business plan, the next steps are as follows:
- Register your business with your local authority at least 28 days before you start selling. You’ll be pleased to know registration is free.
- Inform HSRC that you are self-employed – verify your account and confirm the specifics of your food business.
A food business is categorised as preparing, cooking, storing, handling, distributing, supplying or selling food. The below businesses require a licence to become a part of the food industry:
- Restaurants, cafes and take-aways
- Catering businesses run from home, mobile catering
- Food stalls, food pop-ups and food trucks
Getting your Food Establishment Ready for Approval
Good food hygiene in the kitchen is essential; it ensures that the food you serve meets food health and safety rules and regulations and hygiene standards. The Food Hygiene Rating Scheme gives businesses a rating out of 5 so that consumers can make informed decisions about where they buy their food.
Ratings are a reflection of the standard of food hygiene found at the time of inspection from an environmental health officer. As a business, it is your responsibility to comply with food hygiene laws at all times to ensure food is always safe to eat.
- Handling of food
- How food is stored (cold storage)
- How food is prepared
- Cleanliness of facilities
- How food safety is managed
General Food Law
Before you begin trading, you should brush up on the General Food Law requirements you’ll have to abide by as a professional caterer. The Food Standards Agency has a guide that covers the following areas:
- Food imports and exports
- Food safety
- Labelling and product withdrawals and recalls
Scaling Up Your Food business
First Step: Find the Perfect Kitchen Space
Scalability describes the ability of your business to grow when production increases, without being held back by available resources. Acquiring a professional kitchen space for rent is the biggest leap a home food business will take. Your business has grown and evolved and now requires a long-term and sustainable business plan. Buying a food production space is very costly for small businesses or startups and isn’t always achievable. The answer to cutting costs and reducing your overheads: renting a commercial kitchen.
To ensure your suppliers are the correct fit for your business, visit trade shows or exhibitions to help you decide on the best and most cost-effective manufacturers. It’s also a great opportunity to network.
Acquire your Kitchen Equipment
Safety, workflow and space efficiency should all be taken into consideration when acquiring the necessary kitchen appliances. A commercial kitchen requires industrial-grade equipment that can withstand the wear and tear of heavy-duty use.
Invest in Technology
Technology makes it easier and less expensive to scale a business. You can grow quickly and efficiently at a lower cost by investing in the right Customer Relationship Management (CRM) software, digital marketing tools and Point of Sale (POS) systems. Evaluate not only software but also networks and hardware such as servers and computers.
Create a Marketing Strategy
Marketing is the heart of every successful business; it’s the first step in creating awareness about your brand.
4 great tips to market your business;
- Subscription boxes: subscription boxes are collections of niche products aimed at your target audience.
- Influencer marketing: influencers use their social media accounts, blogs and websites to increase your brand reach.
- Social Media: taking pictures of your creations on social channels with relevant hashtags and the correct tone of voice will engage your audience.
- Word of mouth – trade shows and exhibits: introduce yourself to local businesses who may be interested in your business idea and product.
At Dephna, we offer flexible commercial kitchen spaces with 24-hour access and commission-free deliveries. If you’re looking to scale up your home-based food business and are interested in renting one of our commercial kitchens, dark kitchens or modular cold rooms, book a visit to one of our prime London kitchen locations now.