How to Start a Catering Business in 2025 [Full Guide]

Not everyone wants to open a restaurant, but plenty of people still want to cook for a living. Catering is one of the few food businesses that lets you start small, work flexibly, and grow on your own terms.

From private parties to office lunches and local events, there’s steady demand for good food that shows up on time. 

And clients aren’t just looking for fancy venues anymore; they want someone reliable who can deliver fresh, well-made food for real-life occasions.

If you’ve been thinking about how to start a catering business, now’s a good time to take it seriously. You don’t need a team or a shopfront. Just a kitchen, a plan, and a reason to begin. The rest of this guide walks you through exactly how to do it.

Understanding the market

Catering today spans many trends and customer niches. 

Popular trends include eco-friendly and plant-based menus – for example, modern caterers increasingly feature locally sourced ingredients and zero-waste practices, and offer vegan or vegetarian options as standard. 

Customers often look for unique experiences: think interactive food stations or fusion cuisine (blending world flavours), which make events stand out.

Health and sustainability are big drivers – many clients expect caterers to minimise waste, use recyclable packaging and include nutritious menu choices. 

Who is your audience?

Different customer segments want catering for different reasons:

Each segment has its own expectations – for example, business clients may prioritise punctual service and dietary compliance, while a private party may want customised menus and friendly staff. 

Is catering the right fit for you?

Underlying all this is the problem catering solves: busy hosts who don’t want to cook or organise food themselves. 

A caterer takes over the entire meal experience – shopping, preparation, cooking, serving and clearing up – leaving the client free to focus on the event. 

Caterers also solve food-safety and scale issues (they know how to cater for 50 or 500 people), handle different diets and allergies, and provide professional equipment and staff. 

A great caterer is the answer to anyone who loves good food at an event but hates the hassle of making it themselves.

Legal requirements and company setup

Before cooking for clients, you must set up your business properly. 

A key early decision is whether to operate as a sole trader or a limited company. 

On the other hand, a company means more admin: you must file annual accounts and confirmation statements. (For example, a home baker or single-chef food truck might start as a sole trader, whereas a catering team with investors might prefer a limited company.)

💡No matter which structure you choose, company registration is simple and fast – especially with ANNA. ANNA Money offers free same-day company formation (you can incorporate your business online in hours).

Once registered, you’ll get a UK business account straight away. If you use ANNA, the formation and account setup can happen together for a stress-free launch.

Legally, any catering business must register as a food business with your local council at least 28 days before you begin trading.

This requirement comes from the Food Safety and Hygiene (England) Regulations 2013, or the equivalent legislation in Wales, Scotland, or Northern Ireland.

Food safety inspections and hygiene requirements

Once you register, your premises may be inspected by an Environmental Health Officer (EHO) either before or soon after you begin trading.

You must also:

Licences you might need

Depending on how and where you operate, you may need additional licences or permissions:

Insurance for caterers

Insurance is essential even for small or home-based operations.

The three key types:

Most caterers use a combined insurance policy that includes all three.

Typical cover levels range from £5 million to £10 million.

Costs and finances

Major startup costs include equipment and premises, licences, and initial stock. 

The table below shows a rough range of startup expenses for a basic small catering business:

Ongoing running costs include ingredients (food, drink), fuel or utilities, wages (even if just a part-time helper), vehicle upkeep, marketing and replacement of equipment. These can be as low as a few hundred pounds per week for a one-person home business, or much more for larger operations.

How to price your service?

To stay profitable, most caterers aim for gross profit margins (revenue minus food costs) of around 60–70%. That usually translates into net profit margins of roughly 7–8% on total sales

(high-end events businesses can sometimes achieve 15%+).

In practice, you’ll need to price carefully: calculate all your ingredients and overhead costs, and set menu prices to cover them plus a healthy margin.

Where to find loans for your catering business?

Financing can come from several sources:

✨ Government-backed schemes like the UK Start Up Loans scheme provide personal business loans up to £25,000 at a low fixed rate (6% annual interest) and include mentoring.

✨ Charitable funds or regional grants sometimes cover training or equipment, especially for innovative or green food businesses. 

✨ Equity investment or crowdfunding are options if you have an ambitious project (e.g. a restaurant-grade kitchen or large food truck).

Client acquisition strategy

With the business side set up, the next big question is how to find clients. You can build customers in several ways, combining local networking with online marketing:

1. Local outreach

Start in your community:

2. Online presence

3. Partnerships

Build relationships with businesses that share your customers. For example, wedding photographers, party suppliers, corporate event organisers or office managers might refer you. 

If you can reliably service, say, corporate lunches, contact local HR departments. 

Similarly, churches, schools and charities often need occasional catering – meet local organisers or join community business networks. 

Operations and capabilities

On a typical event day, things kick off early. You might start with final menu checks, ingredient prep (like chopping, marinating, and pre-cooking), and packing hot or cold food for transport. Once at the venue, you’ll set up your service area, coordinate with the client or venue staff on timing, serve guests, and then clean up afterwards.

Behind the scenes, there’s plenty more going on:

Skills that keep everything running

While cooking is at the heart of it, successful caterers rely on a broader set of skills:

It’s also worth acquiring some basic business skills, such as pricing jobs, negotiating with suppliers, and performing basic accounting tasks. These can make a huge difference to your margins.

Solo or with a team?

Many caterers start small, working alone or with a helper (often a spouse or friend). As your client list grows, you might:

Hiring too soon can eat into profits, but waiting too long can lead to burnout. The key is to scale gradually and flexibly.

Tools, systems and automations

Good tools can make the paperwork side of catering far easier. For administration and finances, many small businesses use accounting software or apps. ANNA’s business account is one such tool that does more than banking — it integrates invoicing, expenses, and bookkeeping all in one mobile app.

For example, ANNA lets you create a quote, send an invoice, and even share a payment link or QR code so clients can pay instantly. It will also automatically chase unpaid invoices. Alternatively, popular accounting packages like Xero or QuickBooks work well, and ANNA can sync with them if you prefer.

Taking payments and handling cash

If you’re taking payments on the spot — for example, at a market stall or event — a card reader like SumUp or iZettle is useful. ANNA’s account also supports paying in cash at many retailers, which is handy if you take physical payments or need to make supplier purchases in person.

Organising bookings and client info

On the admin side, consider using online forms for enquiries or event questionnaires. 

A Google Form or a booking plugin on your website can collect useful client information — guest numbers, dietary needs, event dates — and automatically populate a spreadsheet. This saves you time retyping, reduces errors, and keeps everything in one place.

ANNA’s receipt capture feature is also handy. Just snap a photo of each purchase invoice or expense, and the app automatically matches it to your bank transaction. That means no more shoebox of receipts or manual data entry to stress over.

Automating key admin tasks

Simple automations can save you hours each week. Set up automatic email reminders for following up on quotes or confirming event details. Even basic tools like Gmail allow you to schedule emails, while platforms like Buffer or Hootsuite can help you plan and schedule social media posts to keep your profiles active without needing to log in every day.

If you file VAT or taxes, software really helps here too. ANNA’s Taxes+ add-on (a low-cost extra) will calculate VAT, prepare returns, and even file them to HMRC for you. This “accountant in your pocket” feature can save you hours of number crunching and late-night admin.

Example: 1-year business plan snapshot

To make this concrete, here’s a simplified snapshot of what your first year might look like:

Final tips and common mistakes

Here are some do’s and don’ts distilled from experienced caterers’ advice:

Why ANNA works for new caterers

ANNA lets you register your company for free and open a business account in minutes—so you can focus on food, not forms. The app sorts your transactions, tracks expenses, and creates quotes and invoices with payment links or QR codes. It also keeps HMRC-compliant records and can handle VAT and tax filings if you add the Taxes+ feature.

It’s a simple, all-in-one setup for banking, invoicing, and staying on top of compliance – ideal for busy caterers getting started.

Try ANNA today and get your catering business up and running with less admin and more time in the kitchen.