How to Start a Catering Business

The first step in starting any new business is to take a step back and do some research. You will need to find out about your future customers and what they want, as well as potential competitors and what they offer.

You can do this online, over the phone or in person, depending on your preference. 

Talk to friends, family and acquaintances who have used catering services in the past and find out what they wanted from the experience. Reach out to people who regularly book caterers, such as those working in events organisation, and find out what they look for when organising food. Check out rival businesses in your area to see what kind of events they cater and the types of food and drink they serve.

Keep thinking about:

1. whether there is demand for your catering services
2. what you can do differently or better than the competition
3. who is your target market

After putting the legwork in with your research, you should have a good idea of the answers to these questions. Additionally, you might have an idea of the type of catering business you are building. Some questions to consider include:

• What events will you cater? Caterers can be hired for weddings, parties, graduation ceremonies, corporate events and more. 
• How many people can you feed? Events can vary considerably in scale, but it’s probably best to start by catering small events so that you don’t find yourself out of your depth and scrambling to feed hundreds of hungry people.
• What type of food will you serve? Some caterers might specialise in a particular cuisine, or aim to meet dietary requirements, such as vegetarianism or veganism. You might have a small menu or provide clients with the opportunity to request custom dishes.
• What kind of service will you provide? You might choose to offer buffet-style catering, office delivery, food stations or plated meals. These different types of service will each have different challenges and requirements in terms of manpower, skillset and equipment.

How much money does it take to start and run a catering business? We can’t tell you that, because every catering business is different. However, we can help you build your own budget, which will give you the most realistic idea of the upfront and regular costs your business will face. 

Remember to include the following:

• Kitchen: Some sort of kitchen space will likely be necessary if you are going to prepare food at scale. For a small catering business, you might be able to start in your kitchen at home, but larger businesses will likely need a permanent commercial location or rented commercial kitchen space.
• Equipment: If you’re going to cook up a storm, You’ll need the right tools to do so. Think about everything you need, from ovens and food processors to knives and whisks. 
• Transportation: You will likely need at least one large car or van to travel to and from events. Make sure you can fit everything you need inside, from ingredients to portable ovens.
• Ingredients: This cost will depend on the types of food you intend to make. Remember to factor these expenses into the cost of any contracts you win, as you will be buying different ingredients for different jobs.
• Employees: If you plan to cater events that include a significant number of people, you may not be able to do all the work yourself. Consider the cost of hiring other chefs, waiters and drivers.
• Energy and utilities: Without power and water, you won’t be able to produce enough food for a party or event. 
• Insurance: A catering business will need several different types of insurance to operate, particularly if you have employees. Find more information about insurance for catering businesses further down this article.

For a detailed guide on putting your budget together, explore our five-step guide to creating a small business budget.

As well as a budget, it’s also a good idea to write a business plan. This will help you to establish goals and understand how viable your business idea is. Furthermore, business plans are normally a mandatory part of applying for a business loan.

For a detailed guide, read our article on how to write a business plan.

Every business needs to choose a business structure and go through registration. Choosing a structure can be tricky, and caterers may choose to operate as a sole trader, limited company or some form of partnership. If you are unsure about this process and how to make the best decision, explore our guide to picking a business structure. 

» MORE: Should I register as a sole trader or limited company?

As well as registering your business by choosing a business structure, you will also need to acquire certain licences and permissions.

Any business that will sell, cook, store, handle, prepare or distribute food must register with its local authority. It is mandatory to do so a minimum of 28 days before you commence trading. Registering is free and cannot be declined by your local authority. 

Once you have registered, your business can be subject to food hygiene inspections at any time without advance notice. Failing these inspections, which will assess the safety and hygiene of your preparation areas and processes, can result in a notice that would ban your business from performing certain procedures. 

Food safety training and a good understanding of UK food safety regulations can help your business avoid falling foul of these inspections.

If you plan on serving alcohol as part of your catering offering, you are also likely to require an alcohol licence. These licences are necessary unless there is no cost to the consumer. 

Most businesses are not free to start, and catering is no different. Once you are armed with your plan and budget, you can turn your attention to getting hold of the money you need to turn your ideas into reality.

Catering businesses vary considerably in size, but with all the equipment involved it’s fairly likely that you will need significant funding in order to get started. Business loans and grants might be the way to go, but there are plenty of other options to explore as well. To get the full rundown, read NerdWallet’s guide to funding a start up or small business.

Opening a business bank account will give you a place to put your funding, while it can also be helpful for budgeting and tax. Sole traders can choose to use their personal account for their business, but a limited company or partnership must have a business bank account. Additionally, sole traders often find it more convenient to have a business bank account as it allows them to easily separate business and personal funds and transactions.

The final key step of starting any business is finding some paying customers. Here are some ideas for getting catering clients knocking on your door, ringing your phone or filling up your email inbox:

• Get people talking: Get the word out about your new catering business. Tell everyone you know, from family and friends to acquaintances you hardly know. Before long, this is likely to lead to some kind of work.
• Business cards and flyers: Print off some professional-looking leaflets and business cards before pinning them up on noticeboards, sharing them with contacts and posting them through letterboxes.
• Get an online presence: Start a website and/or social media page that you can direct interested customers to.
• Local businesses: Find out about local businesses or organisations in your area and whether they hold events. Ask if they hold conferences, socials, Christmas parties, awards shows or other significant gatherings where catering might be required. 
• Event planners: Caterers will often be booked by event organisers, such as professional wedding or party planners. Find some of these professionals operating in your local area and make it known that you are a new and exciting option for the events they work on.
• Trade fairs: If you plan on catering for events like weddings, you might find that trade fairs are a good way to find customers. Fairs such as the National Wedding Show feature many different caterers, so you will need to stand out. 
• Positive reviews: Encourage any customers who have a good experience to leave a review on sites such as Google Reviews.

Remember that many customers will want an opportunity to sample your food before choosing you to cater for their event. Plan menu-tasting sessions that allow them to sample a variety of your dishes, either for free or for a basic fee.