FSSAI Food License

How to Start a Catering Business in India

With the ever-evolving corporates, IT parks, hospitals, schools, colleges, and other businesses in India, Catering business is the one common thing to all. It serves as the backbone to all these sectors and provides ample employment opportunities in a country like India. However, don’t presume the business of catering means serving food to the guests in the big fat Indian wedding. Catering is a diverse business, for which there is a number of legal formalities and other aspects that one needs to fulfill. In this blog, we will guide you on how to start your own catering business from scratch and adhere to all the norms and regulations that government imposes.

Deciding the Business Entity for Your Catering Business

In India, it is seen that people often talk about business ideas, even so, when it comes to executing those ideas they compromise upon the legal requirements of the business. Same is the case with the catering business. If you are a chef, good cook or a passionate food enthusiast, that wants to enter into the business of catering, then you must decide the kind of business entity you want to set up.

Either you can set up a private limited company or a limited liability partnership. Now the question arises is that when you have so many options of business structures available in India then why will zero in on to these two business entities?

If you set up your business of catering as a private limited company or a limited liability partnership, then these business entities are transferrable and provide limited liability to the owners of the business. And these are two of the core advantages that cannot be leveraged through another form of business entities.

In the case of Limited Liability Partnership

If the annual sales of your catering business lead to a turnover of less than Rs. 40 lakhs and the capital requirement are lesser than Rs. 25 lakhs then you have an upper hand, which helps you to be relieved from an audit.

In the case of Private Limited Company

If the turnover exceeds Rs. 40 lakhs, then you need to set up a private limited company. This is the case with almost all the businesses involved in the catering, as the business of catering is on the boom.

In addition, private limited works as a tag of recognition, trustworthy, and attract investors in the market. Because at the end it comes down to the right funding at the right time for the unhindered growth of your business.

Once you decide the right type of business structure, you need to obtain various licenses from the Government Authorities. Some of them are as follows:

FSSAI License

Entering into a food business without getting a food license! Don’t even think about it.

Obtaining an FSSAI license for your catering business must be on the top of your list. Otherwise, the FSSAI will slap you down with such hefty charges and penalties that you will not even able to recover from the damages incurred from the imposition by the FSSAI authority. Forget about starting again from scratch.

But don’t you get all bog down; we are not here to demotivate you. These are just preventive measures to run your food business without being caught up in the legal battles.

What is FSSAI?

FSSAI is basically a Food Safety and Standards Authority of India^[1] that grants a Food License to all the food operators in India. FSSAI authority let the food operators carry on the activities related to the Packaging, manufacturing, storage, processing, distribution of food, transportation, import & export of food products and services, catering services, the sale of food or food ingredients.

FSSAI license is mandatory for all the businesses mentioned above.

How to obtain the FSSAI License in India?

To obtain an FSSAI License in India for your food business, you need to provide the documents of incorporation of the business. Along with this you just need to submit the documents related to the address proof, identity proof as per the format of the Application.

Now you have a business entity and food license to start your food business. But who is going to take care of the other accounts such as tax registration? Do you know, you need a GST registration as well?

Why your food business needs a GST Registration?

Catering business in India requires a certificate of GST registration as per the turnover and the state in which you decide to run your business.

You must get a certificate of GST registration if the annual turnover of your business exceeds Rs 40 lakhs (Rs. 20 lakhs in northeastern states).

How and where do you get the GST Registration?Why your food business needs a GST Registration?

You can either visit the web portal of GST registration or contact any reliable service provider to get the GST registration. For this, you just need to provide a few basic documents and you will have your GST certificate within 7 working days.

Once you start your catering business and have established your name in the market, then how do you protect it from not being taken away by someone else. Well here comes the role of trademark registration.

What is Trademark Registration and how it saves your Catering Business Identity?

Trademark is a unique and distinct identity of your business. It helps in the creation of the brand image. When you get your trademark registered, you own the intellectual rights of that trademark.

In this fiercely competitive market, cases of business identity thefts are not unheard of. Trademark registration will protect the identity of your business. None of the competitors will be able to use the same trademark for their business. What about the growth of your catering business? You are successfully running one catering business and making profits out of it, it is time to open a new branch then trademark will play a major role in this.

Work on your Business Strategy

You are entering into a multidimensional industry; prepare yourself to face the unexpected. And if you want to be a player in the long run, you need to have a proper set of the business plan. Following are the things that you must keep in mind before starting a catering business-

• Decide the kind of food you want to serve such as gourmet, comfort food, BBQ or Ethnic
• Are you planning to specialize the menu and services or you will be dealing in diverse cuisines
• Will you be serving alcohol?
• Which demographic area are you targeting? Who is your targeting audience?
• How you are testing the quality of food and make sure that the quality is not compromised
• What are the preventive measures for guests, if the food and services do not satisfy them? How do you compensate these clients?
• Prepare a list of best vendors to outsource your products and raw materials
• Make a proper list of pricing. Do proper research in the market, what your competitors are charging?
• Do you have a back for the busy days? Once your business picks up there will be days in the midst of your ongoing events, when you may fall short of food or other products you are providing.
• How are you going to manage your leftover food items? How you will minimize the wastage of food items?
• You will soon get chances to host multiple events at a time, design a strategy to justify all the events in your kitty.

Workforce and Inventories for Your Catering Business

To be the main player of a catering business in the market, you must have the right kind of manpower and inventories.

• You must hire the right kind of people who are willing to work during peak times and have the patience and ability to work flexibly.
• Your workforce must be equipped to listen and reply to the clients’ demands. You need to hire a good cook and other people to assist the cook, delivery boys to deliver the materials and equipment, and extra serving staffs for the parties and events.
• When you hire the staff, do check the reference to make sure that your team is reliable enough and would show up to the event.
• Once you are done hiring staff, train them as per the industry standards.

Basic Checklist of the Inventory to work for any event-

• Cooking Oven
• Serving Equipment (trays, water pitchers etc)
• Table setting
• Buffet equipment (Chaffing dishes, serving spoons, plates, fuel cells)
• Coffee/ Beverage station
• Cambro
• Garbage bins
• Tin foil
• Plastic wraps
• Disposable containers for food storage ( for keeping the leftover food items)

Conclusion

If you are looking to start your own catering business, then you must go for it. This is the best time to enter the market. You have the right skill set, know the art of delivering delicious delicacies; Great! The only hustle is to fulfill the legal formalities involved in the business. But don’t you worry there is a single platform where you can get all the registration certificates, fulfill other legal formalities.

Contact Enterslice to start your catering business today.

Read our article:New Food Packaging Regulations Which You Must Be Aware Of