Starting a Food Business

If you’re cooking up plans to start a food business, follow these guidelines to get your new business off to a sizzling start!

• Decide what type of food business you want to run. There are many options, such as a retail restaurants, wholesale food stores, mobile food facilities, caterers, and vending machines. The type of business you ultimately choose will determine the training and permits needed. Also, keep in mind that different businesses require different capital and time commitments. You can browse through Franchise Direct’s directory of food franchise opportunities for various food franchise options.
• Create a business plan and obtain capital. You will need to include important details in your business plan, such as a description of your business, an overview of the food industry, a financial forecast, growth projections, the marketing plan and the required starting capital. This will all require some research, although if you are a food business franchisee, your franchisor may already have information available for you. Restaurant industry sites are a great source of information on the industry itself. These sites give you access to articles and publications that will help you start a successful food business.
• Find out which licenses and permits you need. Depending on the type of food business you have chosen to run, you will need to obtain licensing from different government agencies. Generally, the important ones to contact are your local zoning office, consumer protection or services office, the health department and the department of agriculture. The zoning office will help you determine where you can set up food businesses. The laws will differ from state to state and even amongst municipalities. Depending on what type of food business you wish to operate, the consumer affairs offices may give you your city permit license and approval. There are more approvals required for full service restaurants, and less for a food business like a coffee shop, where food is not prepared on-site. The department of agriculture  in your state may also license businesses, such as bakeries, candy stores, groceries or food processing plants. Further, the health department  licenses other food businesses, like restaurants, bars, catering operations, coffee shops mobile food services and vending machines. If you are working with food in any capacity, especially preparing and serving it, a health permit is important. Often, it will require an annual fee, typically based on both the type of food business and its physical size. Note that licensing requirements are no different for previously existing food businesses that were purchased, and in fact you may be required to make upgrades to the facility. If you plan to make any changes to existing operations (e.g. changing the menu, putting new equipment in, etc), you will need a plan review before these changes can be made. Contact your respective state or local government agencies to understand more about the licenses and permits you need to start your food business, and comply with all the codes established in your area.
• Know the food safety requirements for your state. Every state will have a different set of requirements for food safety and you must be aware of what they are. For instance, most states require that you have someone who has passed an approved and accredited food safety certification exam in employment at your facility. You can check the National Restaurant Association’s website for US regulatory requirements by state.  Often, that requirement can be met with a ServSafe examination. If you need more details on requirements, you might want to contact your local health department or state restaurant association.
• Purchase equipment. Depending on the type of food business you choose to open, you will need to purchase different types of equipment. This may include food preparation stations, hand washing stations, sinks, ovens, refrigerators, vents, bathroom equipment, as well as seating and tables. Also keep in mind important preparations, such as pest control. In the case of a food franchise, the franchisor may provide you with a discount for the equipment by wielding their purchasing power.
• Hire necessary employees. If you choose to run a restaurant or retail food establishment, you will probably need to hire employees, typically cashiers, hosts and hostesses, waiters and waitresses, chefs, busboys and other employees. Make sure you have a clear plan outlined for staffing your business, including hiring policies, wages and job qualifications. Employees in the food industry often have high turnover rates, so be prepared to regularly recruit new employees. You may want to write an employee manual so you have a good foundation for difficult issues, such as wages , employee conflict , and employee termination.  Also keep in mind there are important OSHA workplace safety rules that must be enforced as well.
• Open your business. You are now ready to open your food business. If you have chosen a food franchise, you can begin filling the built-in demand that may exist for your well-known brand name.

If you need further guidance on opening a restaurant, it may be helpful to peruse some books on the topic.