As people’s schedules are getting busier and their jobs more demanding, food delivery businesses are gaining widespread popularity around the globe. Due to the effects of the current COVID-19 pandemic and the fact that people carry many of their activities from home, the industry is continuously growing and slowly shaping a new norm for food consumption.
Another thing the pandemic has taught us is that working or starting a business can well enough be done from the comfort of our house. Digital businesses require digital solutions, and assembling or growing your customer base is no exception. When it comes to the food delivery sector, your options are endless; from fast food to home-cooked meals, to groceries, you can certainly find – and feed – the demand for it.
Running a food business is undoubtedly a potentially profitable venture but still involves a delicate set of rules and challenges to look out for if you don’t want to drain your wallet or close your services too early. If you’re looking to start a food delivery business from home, here’s a comprehensive guide to help you navigate the process.
Licenses and Legal Coverage
When it comes to food, safety is always a concern. That is why national and regional government organizations closely monitor and regulate the industry. The type of license you may or may not need will depend on the place of business, but you should check your local regulations to explore the legal requirements and procedures.
Other legal coverages include food delivery insurance to protect your business from accidents, taxes, and other online service regulations. These may cover location data security, information exchange, and even food regulations that apply exclusively to online businesses. There are even laws that limit the amount sold for specific items and food groups, so be sure to cover all legal grounds before ordering your supplies or creating your menu.
A Business (and Meal) Plan
Even when starting a small business, your success relies on a carefully crafted business plan. Within the food delivery industry, this also means coming up with a meal plan. Primarily, you should evaluate if your business can generate a high-enough return on investment, which you should be able to arrive at by considering the following things:
- The cost of each meal, including ingredients, packaging, and travel;
- Necessary costs like electricity and gas;
- Total labor expenses, including part-time and full-time workers and all forms of compensation.
If you have a defined meal plan, you will be able to make close-enough estimates for all these areas and compare your returns. You should also be realistic about your revenue potential and adjust it often to level your expectations. If the numbers aren’t adding up, you can make adjustments to your meal plan or your overall model.
Preparing Your Materials
A great thing about starting a food delivery business is that you can do it without securing a large amount of capital. If you’re preparing home-cooked dishes, chances are you already have most of the utensils you need for the preparation or can buy new ones at relatively low prices. You will typically need the following materials:
- Plastic or cardboard meal containers and bags and single-use utensils for deliveries;
- Pots and pans – preferably large so you can cook multiple meals at a time;
- Food containers to store the cooked food.
When buying the supplies – including the ingredients – look for good local deals and preferably suppliers that sell in bulk. While you should, of course, make sure not to run out of supplies, you should also make calculations about your needs, especially since fresh food can expire quickly and your budget can be exhausted by overestimations.
If you’ve landed on a business idea, you’ve probably researched the local market and identified your target audience. To get your business off the ground, you will need a good marketing strategy for reaching that audience and raising interest in your product.
If you’re starting small, some great cost-effective marketing options are word-of-mouth marketing, local digital campaigns, and distributing flyers in nearby residential areas, schools, or other facilities. You will also need some preliminary branding, like a logo, flyer design, or campaign slogans, for which you can either hire a freelancer, acquaintances or even try to do it yourself.
Food delivery is a great business option to explore – specifically because of the current opportunities in the industry and especially if you want to work from home. When starting your business, be sure to acquire any licenses and legal coverage, create a business and meal plan, prepare your materials, and craft an effective marketing strategy.
In a time when people are increasingly leaving their kitchen stoves for precooked meals, there are plenty of opportunities for success.