A Guide to Starting a Food Business in 2024

min read

A Guide to Starting a Food Business in 2024

Are you ready to start a food business?

As you may expect, starting a food business in the UK takes a lot of commitment and is quite the lifestyle change from the standard 9-5. Becoming an entrepreneur requires patience and determination - after all, your business may not make the profit you want overnight. You may need to work long hours to get your business off the ground and will need to prepare yourself for less free time. There’s also the legal side to consider - you’ll have to study the regulations that surround the food industry and ensure you adhere to them.

If you’re ready to embrace the unknown and have the determination to succeed, there’s nothing to stop you from achieving your business goals. There’s no better feeling than starting a business - in fact, 82% of small business owners said being their own boss is the top perk.

Starting a food business can open the door to flexible working hours, financial freedom and the immense pride you’ll feel in calling yourself a business owner. If you feel ready to start a food business, what’s stopping you? There’s no limit to what you can achieve. And for the support to get your company up and running, the experts here at SUAZ would love to guide you through the process.

Can you start a food business from home?

While starting a food business from home is certainly possible, there are factors you’ll need to consider when deciding if it’s the right choice for you. Even if you don’t consider yourself a food business, but provide people with food on a regular, organised basis, you are seen as a food business under food law. This means you will need to ensure you’re following the laws outlined by the Food Standards Agency.

Here are some factors to keep in mind if you plan to start a food business from home:

Check you have permission: Planning to run your food business from home or on domestic premises? You’ll need to make sure you have permission from your mortgage provider or landlord. If you’re looking to make major alterations to your home to get your business set up, you may need permission from the local planning office. It may be worth checking with the local council whether you need a licence to run your business. Take a look at the government’s rules around running a business from home for more information.
Suitable premises: While you may love nothing more than cooking for your family in your home, you’ll need to make sure it’s suitable to run your business from. Your home must be kept clean and in good condition. Make sure you have enough wash basins for everyone working to wash their hands regularly, and that surfaces are regularly disinfected.
Food safety: Want to make sure you’re adhering to best hygiene practices? You could look to take a food safety training course. There are several food safety courses online for you to explore, including free allergy training where you can learn how to manage allergens in your kitchen.

How much money do you need to start a food business?

Before you commit to starting your own food business, you’ll need to make sure you have the funds available to bring it to fruition. While starting a business is a significant investment, with the average budget for new UK startups being £5,000, the possibility of financial gains is second to none.

A great place to start to help you estimate the costs of your new venture is by writing a business plan. Your business plan is a written document that details how your company will operate, its objectives and how you plan to achieve them. In simple terms, your business plan is what success looks like for your company. A key section in your business plan is around your finances - after all, without a profit, your business is likely to struggle. It may be worth making predictions around how much profit you expect to make, and any potential losses you envision. From there, you can calculate your equity by subtracting any money you owe from what you own. If you’re looking to apply for a bank loan to give your business a boost, banks will often ask to see the finances section of your business plan to understand your financial situation and ensure you have the means to pay back what you owe.

It’s often a good idea to overestimate the amount you’ll need. Expenses can always rise, particularly with inflation, so it may be worth overestimating the cost of something to avoid any panic further down the line.

How to find your niche

Finding your niche when starting your business can help you stand out from your competitors and attract loyal customers. When it comes to finding your niche, asking yourself what your skills and interests are is a good place to start. Perhaps you pride yourself on your hearty home-cooked meals, or maybe you’re a star baker whose cakes are always well-received. Choosing a cuisine or style that you love to cook will make your work even more enjoyable, and give you the drive to succeed should you face any roadblocks further down the line.

Another great way to identify your niche is by looking for gaps in the market. Are there any cuisines or dietary options that are missing in your area? Perhaps you’ll offer a unique dish no one else has thought of, or commit to sustainable business practices. Whatever your niche, setting yourself apart from your competitors is sure to make your business thrive. Remember that finding your unique selling point (USP) won’t necessarily happen overnight - don’t be afraid to experiment and adapt your niche to connect with your customers.

How to write a business plan

As mentioned earlier, your business plan is a written document detailing all the plans and aspirations you have for your new food business. While writing a business plan may sound tedious, it’s an important step in your entrepreneurial journey and can help to set your company up for success.

Our guide to writing a business plan covers the process in greater detail, but here are some considerations to get you started:

Use data as evidence to back up your points. The more research you have to support your ideas, the more readers will be able to trust what you’re saying.
Keep things simple. You don’t need to sound like the next Charles Dickens! Your business plan should offer a clear overview of your business’ goals, so the clearer you explain things, the easier stakeholders will find it to understand your ideas.
Show your passion. Your business plan is your chance to showcase your drive and determination, so don’t be afraid to express how excited you are for your new adventure.
Don’t rush. Take the time to know your competitors, your audience and your industry. The more time you spend writing, the more you’ll know your business inside out, so you’re prepared for all eventualities.

How to build your brand

Your brand is more than your company’s name or logo. It includes your stylistic choices, such as the colours used on your website, as well as anything that impacts your company’s image and reputation.

The first step in building your brand is getting to know your target audience and what the market is looking like. Is there a recurring theme amongst your competitors? Perhaps all the food businesses you’re looking to compete with use similar colours or tone of voice across their social media or website. Try to position yourself in your customers’ shoes and what you’d resonate most with.

Once you know what your customers are likely to expect or want from your brand, you can establish a brand personality. If your business were a person, what would they be like? How would you describe them? Alternatively, you may prefer to assign an animal or an object to represent your brand and the vibe you’re looking to give off. This can help you to identify the qualities you’re looking for your brand to represent. After all, your brand is more than the food you sell or the logo on your packaging. It’s the personality attached that makes your business feel human.

Understanding food laws

As a food business in the UK, it’s vital that you get to grips with the various food standards and regulations you must adhere to. Here are just some of the key regulations that underpin the food industry:

Food Standards Act 1999: This act established the Food Standards Agency. Introduced in 1999, its purpose is to protect public health where food is concerned, by outlining various food safety standards. This gives the Food Standards Agency the authority to step in on behalf of the consumer at any stage of the food production process or supply chain.
Food Safety Act 1990: This details all food legislation across England, Scotland and Wales. Its purpose is to ensure businesses don’t include anything in food, remove anything from food, or treat the food in any way that would damage the health of those eating it. Other areas covered include ensuring food labels aren’t misleading, and that food businesses sell food at the quality consumers expect.
General Food Law: As a food business, you’ll need to learn the legislation around food imports and exports, safety, traceability, labelling, product withdrawals and product recalls. This is to protect human health and applies to all stages of food production, including the processing and distribution of food.

How to grow your food business

There’s no one-size-fits-all approach to growing your business. But with a strong business idea and the determination to succeed, there’s no limit to the growth you can achieve.

Each business is different and what works for one may not meet the needs of another. While it’s easy to focus on increasing sales and the financial success of your new venture, the longevity and profitability of your business are just as important.

Some ways you can look to grow your business include:

Working with a business mentor who can support you and offer advice as you get your business off the ground.
Look for funding opportunities such as new investors.
Make use of customer testing (or tasting!) so you know what foods they love and which you should improve.
Focus on customer retention to build customer loyalty. Make sure to prioritise strong customer service, engaging with your customers on social media, or even creating a customer loyalty programme to reward your customers for their purchases.

How to hire the right staff

When you’ve put so much work into your business, you’ll want to hire only the best team to bring it to life. But how do you hire the right staff for your business? First things first, make sure you have a clear job description that outlines exactly what you’re looking for. What skills will the person need? How much are you looking to pay? During the interview process, be sure to make detailed notes of the candidates’ strengths, weaknesses and their expectations of the role.

Make sure to assess how well the candidate will fit in with the business culture you’re looking to create. This involves asking questions that go beyond their background or skills, and instead give a taste of their personality and values. That way, you’ll be able to assess who they are as a person and whether they’ll represent the ethos of your new business.

Understanding costs

To help you get an idea of what you’ll need to put money towards to get your food business off the ground, here’s a list of potential costs:

Essentials: These are those purchases that your business won’t be able to proceed without. From hiring employees to investing in new cookery equipment, you’ll need to factor these costs in for your business to grow.
One-off costs: The one-off payments you’ll need to make, such as Companies House’s filing fee which costs £50 to form your new business, or the cost of a top-level domain for your website. If you let us take care of the formation process for you, we’ll cover the cost of the Companies House filing fee for you - one less thing to think about.
Ongoing costs: These costs are what you’ll pay for on a regular basis, such as your utilities, rent and business insurance. If you’ve taken out a business loan, you’ll need to keep on top of your repayments too. You may not want to register your business at your home address, but you still may want to avoid the cost of renting a physical space, our virtual office solution may suit you. You’ll have a business address right in the heart of Manchester to help you to establish your professional image, while keeping your home address private.

Understanding postage and packing

Looking to sell your food products for delivery? To keep your food in good condition and ensure it’s safe to eat, there are various postage and packaging rules you must follow.

If you’re delivering food, it must be delivered in a way that keeps the food safe to eat. Looking to deliver food with your domestic vehicle? You’ll need to meet certain hygiene requirements outlined by the Food Standards Authority.

It’s important you choose appropriate food-grade packaging for deliveries, so if food needs refrigerating, make sure to keep the food cool during transportation by using a cool bag, for example. If you’re sending food by post, you’ll need to package it securely so the food remains intact and safe for consumption.

How to move your business to a business premises

Once your business starts to thrive, you may find you out-grow your home workspace and need to invest in a business space. Before you rush into making big decisions, make sure a physical office space is the right choice for you. Remember you don’t need a business premises to appear professional or make your mark in the industry. If you’re looking to keep your home address private but want a business address to boost your professional image, a virtual office may suit you. You’ll get your business’ name on the map, and avoid those hefty office rental costs.

If you do decide to make the move to a business premises, make sure to set a budget before you get your heart set on a space that’s out of your price range. After all, if you’re looking to move to grow your profits, it wouldn’t make sense for your outgoings to shoot up as a result. As a food business, make sure you choose a space that meets your needs such as enough cooking space for you and your team, and modern facilities that are easy to keep clean.

Get your food business cookin’ today

If you’re dreaming of becoming a business owner, what is there to stop you? Nothing beats the feeling of being your own boss… apart from sharing your passion and talent for quality food, of course. We have heaps of guide to help you out, including our complete guide to starting a business.

Looking for support with your new chapter? Our expert company formation service can do the hard work for you, so you can focus on the important stuff like your exciting new start. Form your company with SUAZ today.