Sample of first chapter of Good Food Good Business. Starting and running a successful catering business.
Starting
a food business
What
everyone needs to know
The
only reason to start a business,is to make money
Starting
a food business
Food
safety procedures
Get
your food safety procedures right from the start,other wise you may
eventually get into difficulties and in the worse case scenario,ruin
your hard won reputation and even lose your business.
Key
requirements:you must have written records to show,that whatever
you do,make or sell,the food produced,must be safe to eat for
all,especially in the case of high risk groups such as:
- Babies and infants
- The elderly
- Pregnant women
- People who are ill or have weakened immune systems
These
food safety procedures mean that you must keep up to date documents
and records showing your procedures and methods,there also other
benefits such as:
- Being on the right side of food safety law
- Satisfied customers will keep returning as they trust your business.
- Good word of mouth about your business
You
must change and adapt your procedures to reflect your changing menu
and cooking methods especially,if the business gets busier and
expands. What you must do,is manage food safety issues and hazards in
your business. How do you prove it? by putting in place,food
safety management procedures which are easy to use and follow,so it
becomes second nature to you and your staff. Whatever procedures you
use,must be written down for inspection by your local authority.
These
procedures must be based on HACCP,what
a mouthful!,what does this mean in real life? HACCP
is
another technical sounding word for common
sense,it
is a method of looking at your operation and figuring out what could
go wrong and putting plans in place to make sure that problems are
avoided. HACCP
means Hazard Analysis Critical Control Points. This internationally
recognised process helps you look at how you handle food and
introduce procedures to make sure the food you produce is safe to
eat.
EU
Regulation 852/2004 (Article 5) requires food business operators, to
implement and maintain hygiene procedures based on HACCP principles.
HACCP
involves the following seven steps:
- Single out what could go wrong (use the hazard analysis form in the 2016 yearbook or 1 year diary)
- Identify the important points where things can go wrong (the critical control points – CCPs)
- Set critical limits at each CCP (e.g. cooking temperature/time)
- Set up checks at CCPs to prevent problems occurring (monitoring)
- Determine what to do if something goes wrong (corrective action)
- Prove that your HACCP Plan is working (verification)
- Keep records of all of the above (documentation)
Your
HACCP plan must be kept up to date. You will need to review it from
time to time,especially whenever any factor in your food operation
changes. You should always ask your local Environmental Health
Officer for advice. Remember that,even with a HACCP plan in place,you
must comply with all requirements of current food safety legislation.
Checking
out your business and seeing what could go wrong
For
instance,how quickly do you put delivered chilled poultry in the
fridge? or does it sit on the floor waiting for the kitchen porter to
come back from his third fag break of the morning?
What
do you do if something goes wrong?
You
come in on Monday morning and discover that fridge has packed up over
the weekend with a
£300
worth
of fresh
chicken
breasts in it. You
have no idea,when the fridge broke down over the weekend. Do you bin
it and take the financial
hit?
or do you thoroughly wash the dubious smelling chicken,marinate it in
strong herbs,spices and flog it,as the days special?
What
do you do? What do you do?. Do the right thing.
4
things bacteria need to multiply: Food Warmth Moisture Time
Make
sure that your food safety procedures will work,especially
when you are not there. Make sure that you use this book to put food
safety management procedures in place
and
keep the diary or yearbook up to date(and do not let your departing
staff leave with it,happens very often).
Hazards
HACCAP
(or common sense and honesty) is not complicated,it just a necessary
routine that must be followed,like brushing your teeth in morning.
Just include HACCP into your business routine to reduce and get rid
of hazards. Hazards are things that can be dangerous in relation to
food safety such as:
- Microbiological- harmful bacteria,such as the chicken mentioned earlier (waiting for the kitchen porter),usual suspects are listeria and campylobacter
- Chemical- rat poison,cleaning chemicals getting into foods.
- Physical- packaging,glass,stones getting into food(imagine crunching down on your freshly cooked burger and finding the cook's recently lost ear ring,in the salad,yes nasty)
COLOUR
CODED CHOPPING BOARD SYSTEM
RED
FOR RAW MEAT
BLUE
FOR RAW FISH
YELLOW
FOR COOKED MEAT
GREEN
FOR FRUIT AND SALAD
BROWN
FOR VEGETABLES
WHITE
FOR BAKERY AND DAIRY
The
local authorities
To
register your business with your local council,you need to give them
28
days notice before you start and they cannot turn you down,even if
you plan to open an eat
till you can’t move
buffet restaurant. Registration
is free and applies to most types of food business,including
restaurants,cafes,hotels,shops,canteens,market stalls,mobile catering
and food delivery vans. If you have more than one premises,you will
need to register all of them.
Changing
your information
Once
you have registered your food business,you only need to notify the
council if:
- The business changes ownership,the new owner must complete a new application form
- The nature of the business changes
- The address at which movable premises(vans and stalls) are kept,changes
You
can register,using the food business registration service at
www.gov.uk/food-business-registration
or
via your local authority website. You can also use the application
form,in the 2016 yearbook or 1 year diary,which you can
photocopy,fill in and send off to your local council. Remember
to inform the council about significant changes in business
and
keep them
updated
with information about your premises. For example that complaining
resident living in the flat on top of your business,who always whines
about the smells from your
kitchen,moves out and you decide to buy the space and open a dining
room up there instead.
Licences
Licences
for sale or supply of alcohol are now dealt with by your local
environmental health department,not the Magistrates Court. If you
wish to sell alcohol and do not already have a licence,you need to
contact your local council. A licence will be required from your
local authority for the following:
- Selling or supplying alcohol
- Selling hot food between 11pm and 5am
- Providing live music,theatre or cinema
- Selling food from a stall or van
Food
hygiene regulations
The
most important food hygiene regulations for your business are
regulation (EC) No 852/4004 which covers the hygiene of foodstuffs
and the food hygiene (England) regulations 2006 (as amended) and
equivalent regulations for the rest of the UK. These cover basic
hygiene requirements for your food business such as
premises,facilities and staff.
Premises
Along
with food costs and staff wages,your rent will be one of your highest
bills. To
serve hot food,you will need an A3 planning licence. They are
normally in high demand and may also have a premium attached.
(depending on location). The premium is a fixed sum of money,required
at the beginning of the lease,paid to the landlord or outgoing tenant
and usually covers things like equipment,fixtures,stock and for
existing trade,if the business is already established and profitable.
The premium will run to thousands,so look out for this when searching
for a premises.
Try
to maximise all space in your newly acquired premises,as you are
paying for the total square footage available,for example, a very
large basement might be great for storage but you can jazz it up,put
in more tables and chairs and turn it into a productive, profitable
area.
Your
premises
- Goes without saying: your business premises must be clean,in good condition.
- The layout,design,site,construction,size must allow for maintenance,cleaning and disinfection.
- It should avoid or minimize airborne contamination.
- Provide enough working space to carry out all tasks properly,even a small burger van must allow the cooks to carry out all tasks in a hygienic manner.
- Must protect against dirt,toxic material,prevention of crap falling into food(contamination) and prevention of mould on walls ( which means that you probably have poor ventilation)
- Make sure that it allows for effective pest control.
- Must provide best conditions for handling and storing food at appropriate temperatures.
Being
optimistic and thinking long term about the premises,is there room
for growth and expansion? To avoid headaches,loss
of
money,hassle,WTF! situations,consult local
experts such as commercial agents,surveyors and solicitors and
your local authority first,before you buy,lease or rent any premises.
Gather as much information as possible,even before buying an existing
catering business,research the name of the business on google,you may
find that they have a good reputation or you may discover a history
of improvement notices with a terrible local reputation. Will the
sign 'Under new management' be sufficient to tempt back customers?
Renting
premises
Every
situation is different but these are the kinds of things to expect:
- The rents are based on the open market rental value and you should work out in your business plan,if your turnover can pay the rent(and other overheads) and still leave you a decent profit.
- Rent reviews at the end of leases tend to be in an upward direction.
- You may be responsible for all repairs,decorations and maintenance of services for the premises.
- Factor in costs for dilapidations;an amount payable to the landlord at the end of the lease for repairs
- You will be responsible for the payment of all utility bills and business rates.
- Do not forget surveyor's and legal fees in connection with the letting process and preparation of the lease.
- Buildings insurance may be covered by the landlord,if not,another bill for you to pay.
- A rent deposit equivalent to anything from 3 to 12 months rent (depends on what you negotiate with the landlord) is payable on all new lettings,this significant amount of money is normally held throughout the term of the lease. Also normally three month’s rent in advance is payable on completion of the lease.
- If you are an individual without a business track record and insubstantial personal assets,the landlord may want a guarantee that you can meet the rent costs. In most instances a bank guarantee will be fine,however some landlords may want a cash deposit or they may insist on taking a charge on your personal property. Think carefully before agreeing to this,business failures happen to the best.
- The rent is normally payable quarterly in advance.
- Break clause: a date in the lease,agreed by you and the landlord,where the lease can be ‘broken’ without anyone facing a penalty. You need to give your landlord 2 months notice that you are using the break clause.
These
are classes of property planning use which are as follows:
- A1: a retail shop
- A2: professional and financial services (e.g. estate agency, bank)
- A3: restaurant or café
- A4: drinking establishments (e.g. pub or bar)
- A5: the sale of hot food for consumption off the premises
In
certain circumstances, it may be possible to change the use of the
property. You may also have to make an application to the local
council for planning permission to change the use.
Turnover
rent
Turnover
rents enable landlords and tenants to share the risk and reward of a
tenant’s business. A turnover rent arrangement usually involves the
tenant paying a base rent (usually between 70 – 80 %) of the open
market plus a turnover ‘top-up’ which is based upon a percentage
of the tenant’s turnover and which is payable only to the extent
that it exceeds the base rent. Landlords
will want to ensure that your turnover includes everything from
physical products to online orders.
Your accounts
will be independently certified and
the landlord is entitled to review the documentation. Make sure terms
are negotiated, so all parties are happy.
Product
withdrawal and recalls
Keep
up to date as a supplier may have supplied your business,food that
that is harmful to health,unfit to eat and it may have neighed
instead of mooed. Withdrawn or recalled products must not
be sold,but immediately removed from the shelves and not used in your
kitchen. The food is not safe to eat as it may contain:
- Bacteria which may make people sick.
- There may have been a discovery of a physical contamination such as glass or metal.
- Mislabelling of food,a food may contain an allergen, such as nuts but does not appear on the label.
Make
sure that your staff are aware of such products and know what to do.
If in doubt:always ask your local Environmental health officer for
advice
Menu's
Make
sure that all your prices,service charges are clearly displayed. If
you run a business where you sell high tea for £45
or more,your customers should not have a shock when they are handed
the bill. Do
not use terms like 'freshly
made'
or
'home
made'
in
a misleading manner. Pictures
and descriptions of food must be accurate,if you say that you are
selling battered cod and chips,it better be cod and not cheaper
whiting or catfish.
True
life story
A
chip shop owner who tried to make extra profit by passing off catfish
as cod has instead found himself £2,000
worse off. The owner was prosecuted after a tip-off to trading
standards investigators by a customer who suspected the 'cod' was in
fact a cheaper alternative. The
shop in Bourton- on-the-Water sold Pangasius Hypophthalmus,a type of
catfish masquerading as cod.
Source:www.dailymail.co.uk
If
someone with an allergy asks about the ingredients in a particular
item,give the customer the correct and precise information,do not
guess. If your food contains genetically modified soya or maize then
it should be clearly displayed. You can also display the calorie
content of your dishes to help your customers make informed choices.
This is not a legal requirement.
VAT
To
charge or not to charge? that is the question, it all depends on a
number of factors:
- Are you selling hot or cold food?
- Do you need to register for VAT?
- Do you sell products like crisps, bottled water where VAT always applies?
The
main regulation that, you need to take notice of is VAT
Notice 709/1: catering and take-away food / VAT Notice 701/14
Starting
your own business aka the roller coaster
A
business plan is absolutely essential and has many functions from
securing funding,to measuring the success of your business. Your plan
must include details of your
objectives,strategy,sales,marketing,social media profile and
financial forecasts. Get
an effective,memorable business name at the same time,explore logos
and domain names for your website and availability of email
addresses. Starting up any type of business requires capital –
either through savings,a bank loan,grants,crowd funding or business
angels. This
task of securing investment is notoriously difficult,full of
rejections and setbacks,but always remember the following words:
“Nothing
in the world can take the place of persistence. Talent will not;
nothing is more common than unsuccessful men with talent. Genius will
not; unrewarded genius is almost a proverb. Education will not; the
world is full of educated derelicts. Persistence and determination
alone are omnipotent. The slogan Press On! has solved and always will
solve the problems of the human race.”
Calvin
Coolidge the 30th President of the United States of America
Types
of business entity
You
must choose a legal structure for your business. This structure will
define your legal responsibilities,such as:
- Paperwork you must fill in,to get started i.e. a limited company.
- Taxes you will have to manage and pay.
- Paying yourself from the profit your business makes.
- Your personal responsibilities if your business makes a loss.
There
are 3 main types of legal structure:
- Sole trader- self employed individual.
- Partnership-with another person or even more people.
- Limited company.
You
will need to choose your structure before you start,you can always
change it after you have started.
You
can register a private limited company online at
www.gov.uk/register-a-company-online,It
usually takes 24 hours and costs £15 (paid by debit or credit card
or PayPal account).
You
will need:
- The company’s name and registered address
- Names and addresses of directors (and company secretary if you have one)
- Details of shareholders and share capital
Record
keeping AKA red tape
Which
ever business structure you choose ,you have now entered the world of
endless paperwork:
- Income records
- Expenses
- Tax returns
- Employees details
- Bank statements
- Bills
- Work place pensions
The
list never ends but you will have to get with the program,so update
your records regularly,keep all receipts,pay your employees tax and
national insurance contributions etc. You must keep records for at
least 5 years. You will need to be aware of employee rights,minimum
wages,equal opportunities,immigration status etc. Get
an accounting and cash-flow system set up to maintain
accurate,up-to-date information about cash-flow is absolutely
essential from the start. You
need to keep on top of all these and run your business
successfully,if all this sounds like too much,then you might be
better off working for someone else for a living and forget your
outrageous dream of running your own successful food business.
Dig
deeper
www.fpb.org/business-resources
www.gov.uk/starting-up-a-business/start-with-an-idea
www.gov.uk/alcohol-licensing
www.food.gov.uk/news-updates/news/food-alerts
www.hse.gov.uk/workers/employers
www.gov.uk/renting-business-property-tenant-responsibilities
www.gov.uk/rates-of-vat-on-different-goods-and-services
www.startups.co.uk/10-steps-to-starting-a-business
www.smallbusiness.co.uk/starting-a-business
www.startupdonut.co.uk
www.knowledge.hsbc.co.uk/business_plan
www.fsb.org.uk
federation of small business
www.simplifythelaw.co.uk
www.lawdonut.co.uk
Equipment:
www.nisbets.co.uk
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