How to start a food business and run it successfully

Starting a food business can be an exciting way to turn your passion for food into profit. To give you the best opportunity to run your business successfully, you should take the time to plan and prepare. From business insurance and energy savings to broadband and finance, Bionic offers services designed to support you in running and growing your business. 

In this guide, we provide advice on how you can get ready to start your food business. More information on the type of cover you might need can be found on our food business insurance page.

Things to consider before starting a food business 

Planning 

Before you dive into starting a food business, taking time to plan and prepare can make all the difference to your success. A detailed business plan helps you clarify your idea and understand whether it’s commercially viable. At this stage, you should consider: 

• Your concept – what type of food business are you launching (cafe, takeaway, restaurant, street food)?  
• Target market – who are your customers and what are they willing to pay? 
• Location – footfall, local demand, rent and competition can all impact profitability. 
• Costs and pricing – factor in ingredients, staffing, energy, rent, and waste to ensure healthy margins. 
• Growth strategy – will you start small and scale, add delivery, or expand your menu over time? 

Registration 

Once you’re ready to start your business, you must register with the appropriate authorities at least 28 days before you begin trading. Registration is free and applies to most food businesses, including home-based operations, commercial kitchens, market stalls, and mobile food units. 

When registering, you’ll be asked for details such as: 

• Your business name and address 
• The type of food you’ll handle or prepare 
• Your trading start date 

Permissions 

Ensure you have all necessary permissions and licences before opening doors. Local councils set their own rules and fees, so requirements can vary by area. Securing the right permissions before opening helps you trade legally and avoid fines, closures, or disruptions once you’re up and running. It’s essential to check these early, as some approvals can take time.

How much does it cost to open a food business? 

One of the first questions you may ask when starting your business is, ‘how much does it cost to open a food business?’ The truth is, there’s no one straightforward answer, and things can differ from business to business.  

The final amount depends on where you set up, the type of food business you want to run, and the scope and ambition of your plans and includes expenses like premises and renovations, equipment, professional services and more. 

The food industry is made up of a wide range of business types, and your business model can influence your food business insurance costs, legal obligations, target audience and startup logistics.  

For example, a small home-based business may have minimal upfront costs compared to a restaurant or cafe, which could require a more complex setup and operations. Similarly, food trucks and market stalls can have different upfront and ongoing costs than online and delivery food businesses. 

What are the key start-up costs? 

Understanding your main start-up costs is essential for creating a realistic budget and avoiding unexpected expenses. Typical start-up costs may include securing and renovating premises, purchasing furniture and equipment, getting licences, paying for professional services, buying initial stock, setting up payment systems, and funding for any pre-opening marketing. 

Once the business is up and running, you’ll also need to plan for ongoing monthly expenses. These usually include rent or mortgage payments, energy bills, staff wages, software subscriptions, equipment maintenance and marketing. You should also allow for unexpected costs, such as equipment repairs or increases in food prices. Building these expenses into your budget should help keep your finances under control and your business running smoothly. 

Premises and renovations 

Whether renting a commercial kitchen or renovating a food venue, premises costs can vary widely. Rent or purchase costs can depend on location, size and local demand. Renovations may involve updating electrics, plumbing, ventilation, flooring, lighting and overall interior design. 

Equipment 

High-quality equipment is essential for food production and safety. From ovens and refrigerators to fryers and dishwashers, along with smaller equipment like cookware and utensils, commercial kitchen equipment costs are another significant portion of a restaurant’s startup budget.  

Business rates 

Business rates apply to commercial properties and should be built into your financial plan. These charges are based on the property’s rateable value and are set by local authorities, meaning costs can vary widely depending on your location. 

Insurance costs 

Understanding Insurance costs is key to helping to cover liabilities and protecting your investment. All employers who have staff are legally obliged to have employers’ liability insurance. This helps cover the cost of compensating employees who are injured or become ill through work. Other covers to consider include public liability and product liability insurance. 

If you are unsure what type of insurance your business needs, the team at Bionic can help.

Energy costs 

Energy usage for cooking, refrigeration, and lighting can significantly impact monthly costs when running your business. At Bionic, we work with a panel of regulated UK energy suppliers to help you compare energy suppliers and find options that may be suitable for your business.  

Professional services 

Many business startups need support from various professional services. Accountants, legal advisers, and consultants can help with compliance and financial management. Getting support with expert guidance early on could help prevent costly mistakes and delays. 

Marketing and branding 

A compelling brand and targeted marketing plan are essential start‑up expenses for attracting customers. Initial costs might include logo design, website development, professional photography, social media setup, menu design and signage.

Are there any regulations and licenses I need to be aware of? 

Starting a food business means navigating regulations and licenses designed to protect public health and safety. Below are some of the key licenses and permits you may need: 

Food business registration 

All food businesses in the UK must register with their local authority at least 28 days before opening. This is a legal requirement for all food businesses and is free to complete online via your local council's website. 

Street trading licence  

If you plan to sell food on the street or at markets, a street trading licence is essential. Note that each local authority has its own rules and regulations. 

Music licence 

Playing copyrighted music in your venue requires a music licence to compensate rights holders. For recorded or live music, you’ll need a licence from PPL PRS Ltd. 

Alcohol licence 

Serving alcohol means applying for a designated premises licence with your local council. To apply for a licence, you will need to complete an online application form and send it to your local council licensing team, along with the fee. 

Planning permission 

Changes to a building or its use may require planning permission from your local authority. For example, if you’re converting a retail shop into a bakery or cafe, you’ll need planning permission. 

Food hygiene certificate 

A Food Handler’s License (often called the Food Hygiene Certificate) confirms that staff working in food service know how to handle food safely. While formal food hygiene certificates are not always a legal requirement, local authorities normally expect food handlers to be appropriately trained.

Are food businesses profitable? 

Food business profit margins can vary widely depending on your concept, location and how well your business is run. Some food business models offer higher profit based on overheads, efficiency and scalability.  

Recent data across 2025 industry reports show that full-service restaurants in the UK typically operate with net profit margins between 3-5%, quick-service establishments often achieve higher margins of 6-9% and high-end dining venues in prime locations with strong brand recognition may exceed these averages, reaching 8-12%. Figures are indicative only and will vary a lot by business, location and operating model. 

While strong systems, efficient operations and smart marketing can make almost any business profitable, the best food business to start is one that you enjoy running, not necessarily one you pick solely for the margins. 

How can I make sure my food business attracts customers and makes money? 

Attracting customers and keeping them is just as important as launching your food business. Here are some key strategies to help you draw in customers and keep them coming back: 

Design a fantastic menu 

A well-designed menu can attract customers and help you drive profit by clearly showcasing what makes your food business special. Including options that cater to all dietary requirements helps widen your customer base and encourages repeat visits. Pair this with a strong USP, whether it’s locally sourced ingredients, bold flavours, customisable options, or signature dishes that can’t be found elsewhere. 

Marketing  

Effective marketing can help you reach your target audience and keep your business top‑of‑mind. Posting engaging content such as food photography, day-to-day moments from the kitchen, or news about specials helps build familiarity and trust, making potential customers more likely to visit.  

Keeping your website and Google Business profile accurate and current ensures customers can quickly find your location, opening times, and menu easily. What’s more, investing in targeted paid advertising allows you to reach local audiences at the right moment, increasing foot traffic and turning visibility into consistent revenue growth. 

Add online ordering and delivery services 

The takeaway sector in the UK has boomed in recent years, making it an attractive proposition for restaurants, pubs and other food businesses. Online ordering and delivery options help capture a larger customer base and increase sales. From a profitability standpoint, you can try to generate extra revenue and increase your reach beyond in-store customers.  

If you are delivering food orders, there is some additional information you need to be aware of. You’ll need to check you’re complying with the law, provide allergen information before the purchase of food is completed, and when the food is delivered, choose appropriate food-grade packaging and ensure your transportation vehicle for food meets hygiene standards.

How to start a food business from home? 

Starting a food business from home is very different from operating a commercial restaurant or takeaway. Home-based food businesses usually operate on a smaller scale, using a domestic kitchen that still needs to meet food safety and hygiene requirements. 

Because your business is based in your home, there are additional legal and practical considerations. You’ll need to make sure you’re complying with food laws, protecting customers and safeguarding your equipment and property.  

Register with your local authority 

Before you start selling food, you must register your home food business with your local authority. In the UK, this is done through the GOV.UK website and must be completed at least 28 days before trading begins. Registration is free and ensures your business can be inspected for food safety compliance. 

Check you have the appropriate permissions 

Operating a business from home may require approval from other parties. Depending on your situation, you might need consent from your landlord, mortgage provider or local planning authority. It’s best to check this early to avoid issues once your business is up and running. Remember, standard home insurance won’t cover you for business activities carried out at home, so you should consider arranging business cover as well. 

Register as self-employed 

If you’re starting a food business on your own, you’ll need to let HMRC know that you’re self-employed. This applies even if the business is part-time or alongside another job. 

Food safety training 

Food safety is essential when selling food to the public. While formal qualifications aren’t always legally required, completing a recognised food hygiene course is strongly recommended. 

Prepare your premises to run a food business 

Your kitchen should be clean, well-organised and suitable for preparing food safely. This includes having proper storage for ingredients, clear systems for managing allergens and routines for regular cleaning and maintenance. 

Get your food business on its feet with help from Bionic 

Getting your food business up and running starts with careful planning and preparation. At Bionic, we’re here to help with your business basics like energy, insurance, broadband and finance.  

We work with a panel of regulated UK suppliers and providers to get you a deal suited to your business needs, and requirements. We’ll provide you with the tools and support you need, so you can focus on managing costs and scale your business with confidence. Get in touch by starting a quote online today. 

Ready to start your food business? Get a quote for business essentials today.