Posted: Tue 2nd Apr 2019
What's it like starting a food business from your kitchen table? How do you make the jump from test sales to commercial food premises? The increase in flexible venue options and support have made it easier to grow a food business.
We talked to industry experts about what start-up founders should consider when growing a food business. Here are some of the best tips they shared.
You need to register with your local authority
It's important to make sure you have all the paperwork in place when you start working from home. Charlie Jones, who co-founded Kitchup, which helps start-ups find space, explains:
"You need to register your business with the local authority where your kitchen is located. Once you have done this an environmental health officer will come and inspect the premises and your operations, so make sure your paperwork is up to date!"
The Food Standards Agency has guidance on who needs to register and how the process works.
Consider the cost of commercial space cost for a food start-up
The cost of commercial space varies greatly, but there are low-cost opportunities available. Charlie says the cost varies depending on the type of space and length of time, but added he had rented space from £100 for eight hours.
"Most hosts will want a deposit upfront, so you'd have to factor that into your cash flow as well but some of our hosts ask for as little as £100.
"Assuming you've already paid for your business set-up costs and had your own equipment from your kitchen table business, you could get going from just £200."
Think about how your business will scale with time
It's really helpful to find a location that allows your business to grow. Having the flexibility to add additional storage space and staff on a piecemeal basis helps reduce risk.
Stretching what you can do at a location until breaking point will put pressure on production and getting a large space from the outset will be harder for cash flow. Bonnie Joplin from Safe and Local Supplier Approval (SALSA) explains:
"Commercial premises may be a daunting step for some businesses, but it's often necessary once sales start to reach a certain level.
"Operating from a professional workspace can also help build business credibility and it's usually a requirement for trade customers."
SALSA runs an approval scheme, which helps local food producers sell to national and regional buyers. Bonnie says it's vital that you make sure your premises:
is designed to control risks to food safety, such as preventing cross-contamination
has adequate storage
has effective pest control
"This may be easier to achieve in dedicated commercial premises but is also necessary if you're producing from home. Make sure you have a robust food safety management system in place – your customers' safety and your reputation depend on it."
Make sure you have fun
The founders of food businesses are incredibly passionate. But that doesn't mean it's easy. It's important to do something you love, build your network and never stop learning.
Oppo Ice Cream co-founder Charlie Thuillier said people thought healthy ice cream was a crazy idea when he launched in 2012.
"Looking back it was rather intense and lonely. I think every founder would agree it was tough in the early days of the company formation, especially if you are a first-time founder."
Charlie Thuillier recommends "acting like David, not Goliath" and negotiating on everything. He got a branding agency to help create the packaging and give him a desk in return for a share of the profit, for example.
"They had showers and a kitchen so what more could I need?! I didn't have a flat so it beat kipping on my brother's sofa and meant I could work much longer days and weekends."
Bonnie echoes Charlie Thuillier's comments about building a network, saying the small business food community is "very supportive". She recommends:
asking other producers questions
looking out for social media accounts
asking buyers for feedback
taking the opportunity to learn all you can about the industry
Kitchup's Charlie Jones reminds founders to enjoy the process, too.
"Have fun! It's a tough industry to be in and the long and unsociable hours you spend in this competitive market need to be worth it. So make sure you're enjoying yourself and doing this for the right reasons!"
Cost-cutting tips for food-business founders
Stay lean and subcontract or outsource everything that isn't within your skillset.
Learn in someone else's business. Founding a business as your first job means it will be more challenging than it needs to be.
Build relationships and be kind.