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What is a Takeaway Business?
The takeaway industry is at an all-time high, with more than 46,000 takeaway and fast-food restaurants currently operating in the UK. 15% of adults in the UK order takeaway food at least once a week, equating to more than 5 million people. With the takeaway industry booming, now could be a great time to set up a takeaway business.
A takeaway business, also known as a quick service restaurant (QSR), is a type of food business that is specifically designed for takeaway food. A takeaway restaurant prepares food that is ordered and collected (usually from a drive-through window or an ordering counter) to be eaten off the premises or delivered directly to the customer’s home. A takeaway business is popular with customers because of its convenience and because of the typically lower prices.
Takeaway restaurants serve a wide variety of food. There are many different types of foods and cuisines that your takeaway business could focus on, including:
- Fast food, e.g. burgers, pizzas, kebabs, chicken nuggets and French fries.
- Cuisine from a specific country, e.g. Chinese, Indian, Italian, Thai or Japanese cuisine.
- Traditional fish and chips.
- Vegetarian or vegan food.
- Healthy eating food, e.g. salads, poke bowls, smoothies and protein boxes.
- Desserts, e.g. cakes, ice cream, milkshakes, waffles, brownies and cookie dough.
When choosing the type of food your business will specialise in, consider the food you are familiar with and are skilled at cooking and the market demand in your chosen area. Once you have chosen the type of food you are going to specialise in, you can then design your menu. Focusing on a specific type of food can help you to focus your menu, profit from a particular takeaway niche and make your business stand out.
There are several different ways you can operate a takeaway business, including:
A takeaway delivery service
This type of business offers a delivery service. Customers access your menu (usually online or via a physical menu leaflet) and place an order, either online, over the phone or via a mobile app. The food will then be delivered to them within the specified timeframe. Payment can be made online or over the phone while placing the order or customers can pay upon delivery (usually in cash). If you choose to set up a takeaway delivery business, you can handle deliveries yourself or sign up with an order and delivery service, such as Just Eat, Deliveroo or Uber Eats.
A takeaway collection service
This type of business offers food for collection. Your takeaway establishment will likely be located in a central or busy area that is easily accessible to customers and can capitalise on passing trade. Depending on the size of your premises, you may offer a drive-through service or a collection service from the counter. You may offer a collection service whereby customers order their food in advance and then come to your restaurant at a specified time to collect the food. Alternatively, they can order the food on your premises and wait for it to be prepared.
A collection and delivery service
To maximise your sales and profits, you may choose to offer both collection and delivery services. To do this, you will need to ensure your kitchen can handle a higher volume of orders and that you have an appropriate number of employees to fulfil your orders.
A home takeaway business
A home takeaway business prepares food at home, rather than on a commercial premises. They will then deliver the food or arrange for customer collection. This type of takeaway business usually accepts a significantly lower volume of orders and will likely only accept orders in advance.
There are many different responsibilities associated with running a takeaway business. Your responsibilities can vary, depending on the type of takeaway you set up, the size of your business, your menu and the number of employees you hire.
Some of the tasks you can expect to be responsible for include:
- Sourcing and ordering stock and ingredients.
- Planning and preparing your menu and pricing your food and beverages.
- Purchasing, cleaning and maintaining equipment and machinery.
- Preparing, cooking and serving food and beverages.
- Delivering orders to customers and handling customer collections.
- Implementing food safety and hygiene policies and ensuring they are followed by everyone in your business.
- Ensuring the cleanliness of your premises and avoiding cross-contamination.
- Complying with all legal guidelines and health and safety requirements.
- Managing inventory and maintaining accurate records.
- Speaking to customers, taking orders and handling payments and receipts.
- Overseeing daily operations, such as staffing, scheduling and managing inventory.
- Ensuring timely delivery of orders.
- Monitoring driver performance.
- Marketing and advertising.
- Completing business and administrative tasks, such as budgeting, forecasting and reporting.
Starting up a takeaway business can be both financially and personally rewarding. You do not need any formal qualifications to open a takeaway; however, you will need the necessary skills, experience and training required to create recipes and prepare and cook the food to a high standard. You will also need the necessary knowledge of health, safety and hygiene regulations and requirements to ensure you run your business safely and hygienically. A high level of knowledge of the food industry, an understanding of how to successfully run a takeaway, strong business skills and a solid business plan can also be beneficial.
Types of Customers
A takeaway business can be popular with people of all ages and demographics. However, multiple factors can influence the typical customers that order from your takeaway. Identifying your typical customer base can help you to plan your advertising and marketing strategies, focus your business and maximise your profits.
Some of the factors that can determine your typical customer base are:
This is one of the most important factors in determining the types of customers your business is likely to appeal to. It could be that customers are searching for a particular type of food or cuisine (e.g. pizza or Chinese food) or that your menu appeals to them. Consider the types of customers that are most likely to be interested in your food and how you can personalise your menu further to entice them to choose your takeaway restaurant. For example, a fish and chip takeaway may be popular with families so offering a children’s menu could be advantageous.
Your primary ordering and delivery strategies
This is another important factor, as the majority of takeaway customers are looking for convenience and ease. What ordering strategies are in place in your restaurant (e.g. online, over the phone or via a food delivery service)? Do you offer a delivery option or is it collection only? Does your business have a drive-through? These are all important factors that can determine whether a potential customer will choose your business.
Takeaway restaurants usually only offer a delivery option to customers located in their vicinity (the maximum delivery radius is usually two miles). This is to reduce delivery costs and ensure the food is delivered to customers at the appropriate temperature and in a good condition. If your business operates a collection service (e.g. via a drive-through or ordering counter) your typical customers will be those who live locally or are visiting the area for another reason. For example, if you are located close to a retail area, your typical customer base may be primarily shoppers.
Your wait times
When a customer attempts to make a food order, the waiting time for food will be an important factor they consider. Your wait times will be determined by the size and capabilities of your kitchen, the number of employees you have, the volume of orders and the availability of delivery drivers. A shorter wait time is likely to be most attractive to potential customers.
Your pricing strategy
Your price points will be a key determiner of your customer base.
Takeaway customers can typically be separated into three pricing categories:
- Budget: This type of customer is looking for the lowest-priced food and is usually happier with a more limited menu and more basic service. Price will be a major factor when choosing a takeaway restaurant.
- Mid-range: Mid-range customers are looking for a combination of quality and affordability. Although they don’t want to pay premium prices, they don’t look for the cheapest option and instead look for a less limited menu and higher quality food at a reasonable price.
- Luxury: This type of customer wants the highest quality, best-tasting food and is willing to pay higher prices. These customers will look at your menu, your hygiene rating, customer reviews and your brand, rather than your prices.
Your business brand and aesthetic
Your brand and aesthetic are key factors in the types of customers you are likely to attract. If you have a physical premises, consider the style and design of your takeaway, including your décor, accessories and the front of your premises. You should also consider the name of your business. If you primarily accept orders online, your takeaway’s website and the design of your online menu will all be important factors that can affect your typical customer base.
Your food hygiene rating
This will be a key consideration for certain customers. If you have a low hygiene rating, this will deter some customers from ordering from your business.
Your customer rating and reviews
Food delivery services (such as Deliveroo, Just Eat and Uber Eats) will all display your customer rating (usually scored out of 5). Search engines such as Google will also display your customer rating and reviews that are easily accessible with a quick search for your business. Some customers will look at your rating and reviews before creating a food order.
Equipment You Will Need
The type of equipment you require will depend on the type of takeaway business you set up, your menu and the size of your premises. Choosing the appropriate equipment is imperative as without it you will not be able to run your business.
Although your equipment requirements can vary, below is a list of the equipment typically required by takeaway businesses:
Stock and ingredients
This is an important ongoing purchase that can take up a large percentage of your business’s running costs. Before ordering food stock and ingredients, you will first need to plan your menu. Try to include common ingredients in multiple dishes to reduce your food waste and create an ongoing inventory that makes it easier for you to create a stock order. As part of your stock order, you will also need to purchase any condiments (e.g. ketchup and mayonnaise) and any herbs and spices that you will require.
An industrial fridge and freezer
A fridge and freezer are essential in your kitchen. You will need to store any perishables and fresh stock or ingredients in your fridge or freezer. Consider how much you will need to store when considering what size you will need. If you have the available space, you may opt for a walk-in or industrial-sized fridge and freezer. Ensure both the fridge and freezer are set to the correct temperature.
A food display warmer
A food display warmer is a glass-fronted piece of heating equipment that applies direct heat underneath cooked food. It keeps any pre-made food warm and tasty. The glass front means the food is visible to customers and can help encourage impulse purchases. You can keep different food items in your warmer, as long as they are separated to avoid contamination.
An industrial oven
Depending on the size of your kitchen and the number of items you want to cook in your oven at one time, you may require multiple ovens. However, many foods typically prepared in a takeaway are not cooked in an oven and are instead cooked on a hob or grill. The type of ovens you need will depend on the food you are making.
Some popular choices are:
- A commercial oven.
- A convection oven.
- A pizza oven.
- A combination oven.
- A steam oven.
- A fan oven.
Hobs are necessary for any items that are fried, boiled, pan-roasted, seared or sauteed, including stir-fries, curries and pasta. You will likely want to choose built-in commercial hobs or a commercial range that is built to be long-lasting and can handle heavy usage. The number of hobs you need will depend on the type of food you primarily cook.
Some food items are cooked on a grill rather than in an oven, for example, burgers, chicken, pancakes and grilled sandwiches. You could choose a grill that is inbuilt with your oven or range or opt for a stand-alone grill.
If you plan to cook food in bulk, a bain-marie allows you to keep the food at a safe temperature. They are particularly recommended if your order volume is likely to be high at certain times or if you want to batch-cook some items.
A kebab machine, also known as a gyros grill, is a piece of equipment that is used to rotate kebab meat around a vertical seat of burners, ensuring even cooking. The meat closest to the burner can then be shaved off once it is cooked. You will need multiple machines if you plan to serve different kebab meats. Kebab machines are available in both gas and electric forms and are available in different sizes to suit different-sized meat joints.
Deep fat fryers
Certain takeaway businesses find that a deep fat fryer is their most used piece of equipment (e.g. a fish and chips takeaway or a fried chicken shop). A deep fat fryer is used for cooking items such as chips, fried chicken, battered fish, churros and doughnuts. Consider your menu when deciding whether your restaurant requires a deep fat fryer.
A commercial microwave
A microwave can be useful for heating up any foods or sauces that have been pre-cooked or for quickly defrosting some food items. It could also be that you don’t make all the food in your takeaway business from scratch and instead order some ready-made items. Microwaves can also be useful to steam cook, reheat, pre-cook or defrost any food or stock.
Depending on what you cook in your kitchen, there are several different pots and pans and other cookware you may require, including:
- Frying pans.
- Grill pans.
- Sauté pans.
- Baking trays.
- Roasting pans.
You will likely require multiple pieces of the same cookware items (e.g. multiple frying pans) for different types of cooking and to ensure foods are kept separate.
If you run a dessert takeaway business or offer any baked products on your menu, such as pizzas, pies and cakes, you will need to purchase bakeware. This is the type of equipment you will use to bake your products. Investing in quality bakeware is recommended as it will likely be heavily used and can be susceptible to dents and warping.
Some pieces of bakeware you may need to purchase include:
- Bread pans.
- Baking trays.
- Muffin tins.
- Cake pans.
- Pie pans.
A dough proofer and dough sheeter
Dough is used in a variety of baked goods, including bread, pastries, pizzas and certain desserts. If your takeaway makes dough from scratch, you will need a dough proofer. A dough proofer can help to simplify the dough-rising process, helping you to ensure your products are uniform in shape and size, and that the production process is streamlined. A dough sheeter can help you make dough in large quantities at a much quicker rate. It rolls out pieces of dough to the desired thickness, whilst ensuring the dough is smooth and uniform.
A heavy-duty food processor
A food processor can help to reduce prep time and labour costs. They can be used for a variety of tasks, including pureeing soup, grinding meat and kneading dough. A food processor can shred, knead, dice and grind and combine ingredients into the required mixture using a multipurpose blade that rotates at a high speed.
A mixer is used to combine ingredients in preparation for cooking or baking and is utilised for tasks such as stirring, whisking and beating. They are particularly popular for mixing the batter for cakes and cookies and for creating dough. You could opt for an industrial mixer, as they are more durable and more reliable. When deciding the type of mixers that are best for your business, consider the size and capacity of the mixer, the power and the type of mixing they are capable of (e.g. mixing, kneading, blending and whipping).
The most common mixers are:
- Planetary mixers.
- Horizontal mixers.
- Spiral mixers.
If you sell smoothies or milkshakes, you will need a blender to blend the ingredients together and puree or crush the ice or ice cream. You can also use a blender for making soups and sauces.
Commercial kitchens require more complex ventilation, as kitchens are commonly filled with smoke, steam, odours, high heat and potentially harmful gases.
Some ventilation you could install includes:
- Ventilation hoods.
- Exhaust fans.
- Make-up air systems.
- Fire suppression systems.
An industrial dishwasher
A dishwasher is a necessity, not only because it will help you to save time in the kitchen and reduce your kitchen duties, but also because it will demonstrate the hygiene standards and cleanliness of your takeaway business. Choose an industrial-sized dishwasher to allow you to clean more dishes at the same time, helping your kitchen to run more efficiently.
Stainless steel worktops or worktables
The majority of your food preparation will be done on your worktops or tables. Your worktables should be stainless steel as this material is non-porous, meaning it is resistant to most bacteria and germs. It is also easier to clean and will help you to maintain high standards of hygiene.
Storage racks and shelving
Shelving creates a safe and organised area for storing non-perishable ingredients (such as bread, seasoning and dried pasta), as well as equipment, accessories and utensils. Shelves also allow you to maximise the space in your kitchen. You will need enough shelving to keep stock separate and keep your kitchen well-organised.
Some kitchen accessories you may require include:
- Colour-coded chopping boards.
- Kitchen knives and a sharpening stone.
- Mixing bowls.
- Temperature gauges.
- A strainer and colander.
- A timer.
- Weighing scales, measuring cups and a measuring jug.
- Oven gloves.
- Baking paper, greaseproof paper and aluminium foil.
Some cooking utensils you could require are:
- Stirring spoons.
- Peelers and graters.
- Tin openers.
Storage containers can be used for safely storing any opened stock, to prevent spoilage or contamination. You can also use the containers to store any cooked or pre-prepared food, such as salads, to keep them fresh for longer. Ensure your storage containers are strong and airtight.
Some storage containers you could opt for include:
- Food storage containers in different shapes and sizes.
- Dough containers.
- Kitchen canisters.
- Large ingredient bins (for storing larger amounts of dry ingredients).
- Vegetable crispers (to keep your fruits and vegetables fresh and crisp).
These are necessary to label when ingredients were opened and when certain items were cooked. It ensures that all stock, ingredients and food products are completely safe to use and that your kitchen is operating in line with food safety and hygiene guidelines.
Equipment and handwashing sinks
Equipment sinks should be used specifically for cleaning or disinfecting food equipment and utensils and should not be used for handwashing. You must ensure the sink has both hot and cold running water. You will also need separate handwashing facilities that are used solely for washing hands. As well as hot and cold running water, your handwashing sink should also have sanitising products (such as handwash) and a means for drying hands (e.g. a hand dryer or paper towels).
Rubbish bins and a waste disposal system
You will need rubbish bins in all areas of your takeaway premises. You will also need different bins for different items to ensure you are disposing of rubbish correctly and following recycling guidelines. Colour-coded bins are the easiest way to ensure your waste disposal system is operating correctly.
A Kitchen Display System (KDS)
This is a digital screen that is used instead of handwritten or printed orders. A KDS manages your orders and helps you to prioritise, edit and track your orders. It creates a more streamlined ordering system by ensuring that your kitchen gets orders in real time. It can help your takeaway to be more organised and efficient and reduces the risk of human error.
Insulated delivery bags
If you make deliveries to your customers, you will need insulated delivery bags to maintain the temperature of the food or drink and ensure food is delivered to your customers at an appropriate temperature. The number of delivery bags you will need will depend on how many delivery drivers you have.
Regardless of whether your customers order and collect their food or whether you make deliveries, you will need appropriate food packaging to keep the food secure and prevent any spillage or contamination. To reduce costs and help protect the environment, ensure your packaging is as environmentally friendly as possible. The type of packaging you require will depend on the types of food you sell.
Some items you may need include:
- Cardboard boxes, containers and bowls.
- Cardboard pizza boxes.
- Polystyrene or plastic boxes.
- Foil containers.
- Paper cups and straws.
- Ice cream tubs.
- Eco-friendly cutlery.
- Paper bags.
- Paper wrappings.
- Chip boxes.
- Portion pots (e.g. for sauces and condiments).
There are a number of different menus you could opt for, depending on the type of takeaway you operate, including:
- Large, waterproof outdoor menus positioned near your drive-through.
- A large menu over your counter.
- Leaflet menus for customers to take away with them or that are delivered to people’s homes for advertisement purposes.
- Online menus.
Your menus should be attractive to potential customers and should be designed to fit your takeaway’s brand.
Some of the information you could include on your menus is:
- The name of each dish.
- An appropriate description of each dish.
- Any allergen information.
- The pricing of each dish or item.
- Additional information, such as vegetarian or vegan.
- A photograph of the dish.
A computer and Wi-Fi system
A computer or laptop is necessary for getting instant access to any online orders that are made. You will also need a computer to run your business website, arrange stock deliveries, for marketing purposes and for completing any business and administrative tasks. A Wi-Fi system will give you access to the internet on your premises.
A business phone
A business phone allows your customers to call to make orders or can allow you to contact customers directly to discuss an order. You could opt for a landline or mobile phone and could advertise your business phone number on your website and your menus.
A website is useful for advertising your business and could also act as your primary ordering strategy. It should contain photographs and descriptions of your food (including the ingredients). It should also show the areas and locations you offer delivery to and your customer reviews. Your website will likely feature an option to order online. Design your website to include your business logo and to reflect your branding.
An online ordering system
If you want to reduce your outgoings and have complete control over all orders and deliveries, and your business has the means to handle orders and deliveries, you may want to invest in an online ordering system. The most popular option is an online ordering system on your website and a dedicated ordering app. Your online ordering system should also feature a secure payment option. The system should be connected to your business phone or computer so that you are alerted to new orders instantly.
A payment system
The type of payment system you require will depend on your primary selling strategy. For example, if you accept in-person sales, you will likely require a Point of Sale (POS) system with a cash till. If you accept orders online, you may require an online payment system. Keep in mind that if you accept orders through food delivery services, such as Deliveroo and Just Eat, the food delivery company will handle any customer payments on your behalf.
Some of the safety equipment your business may require includes:
- Fire extinguishers.
- Rubber floor mats.
- Wet floor signs.
- A fully stocked first aid kit.
A CCTV system
Because you will be storing expensive stock and equipment and may have customers visiting your premises, CCTV can protect your business from potential break-ins and theft. CCTV can also protect your business in the event of an injury or accident and can provide vital footage to the police if a theft or incident occurs at your premises. You can choose the specification of the equipment and how many cameras you require.
If your takeaway accepts cash payments, you will need a safe as a way of safely storing the cash from your till at the end of the day. You can also keep extra change in your safe in case your cash register runs out of change during the working day.
Personal Protective Equipment (PPE)
PPE is a necessary purchase for all food businesses, as it helps to protect your food from contamination. PPE can also protect you and your staff from harm. Some PPE you may require includes hairnets, gloves, anti-slip footwear and aprons.
Keeping all areas of your premises clean is imperative. Food preparation areas and food storage areas are particular areas that should be cleaned regularly throughout the day, to avoid cross-contamination and the breeding of bacteria. You will likely need different cleaning materials for different parts of your takeaway business. You may need to invest in cloths, sponges, antibacterial surface cleaners, bleach, sanitiser, dishwashing soap and a sweeping brush and mop.
When you are setting up your takeaway business, an important consideration you will need to make is the approximate costs associated with starting up and running this type of business. Calculating your typical costs allows you to estimate your initial investment requirements, any monthly and annual costs, your pricing strategy, your profit goals and your acceptable profit margins.
There are multiple costs associated with setting up and running a takeaway business. Some of these costs will be one-off initial costs that you will need to pay when you are setting up your business. Other costs will be ongoing costs you will need to pay regularly – usually weekly, monthly, quarterly or annually.
Although typical costs can vary, depending on the type of takeaway business you set up and the size of your business, the typical costs you can expect to be responsible for include:
Your takeaway premises
Unless you operate a takeaway business from your home, your commercial premises will likely be your biggest expenditure. You will need to rent your premises on a monthly or annual basis. Rental prices can vary significantly, depending on the location and the size of the premises. City centre locations and locations close to point of interest usually have the highest rental costs. Rental costs are often calculated per square metre. They can range significantly, from £500 to £15,000 per square metre annually. Your rental cost may be higher if you are renting an already established, refurbished or equipped food business.
Refurbishment and installation costs
Unless your premises previously operated as a takeaway or a similar food business, you will likely need to refurbish or convert your venue to install the equipment and furniture you need for your business and make the area fit for purpose. You will also want to refurbish and decorate your premises to fit the aesthetic of your business and make it attractive to customers. If your premises doesn’t have an established kitchen, you will need to set one up, which may include installing the necessary water, electricity and gas lines. Renovation costs can vary, from £5,000 to £50,000 depending on the level and scale of work required. As part of your renovation costs, consider how you can make the customer-accessible areas of your takeaway attractive and ensure all areas of your premises are easy to clean and are safe and in line with health and safety regulations.
Your equipment is an important purchase, as without it you will not be able to run your takeaway business. The cost of equipment can vary based on how large your premises are and the type of equipment you require. The bigger your premises and the more food you want to be able to cook at one time, the more equipment you will require. You may choose to purchase less equipment initially and expand your equipment as your business grows. Equipment for your takeaway business can cost between £10,000 and £50,000.
Stock and ingredients
This is an ongoing cost you will need to factor into your budget and will be a major monthly expenditure. Depending on your menu, a lot of your stock and ingredients will be perishables, such as fresh meat, seafood, dairy, fruits and vegetables and bread. These ingredients will need to be purchased regularly and you may need to take deliveries several times a week (or daily). Other dry, non-perishable ingredients can be ordered in bulk. You can reduce the cost of your stock by buying wholesale, buying in bulk and shopping around. To maximise your profits, your food stock cost should be no more than 30% of your food sale price. The higher the return, the higher your profits will be. Design your menu so that multiple items feature similar ingredients to reduce your stock costs.
Maintaining, repairing and replacing equipment
Repairs, maintenance and replacements are ongoing costs you will need to factor into your budget. Although some of your equipment and machinery will come with warranties, repairs and replacements are inevitable – particularly because food preparation and cooking equipment typically experience heavy use. Regularly cleaning and maintaining equipment and ensuring it is used correctly can extend its life, but potential repairs and replacements should still be factored into your budget.
Food delivery service fees
If you sign up with a food delivery service, such as Just Eat, Deliveroo or Uber Eats, you will need to account for their sign-up fees and commission rates. Food delivery services typically charge between £300 and £500 for signing up. Commission percentages can range from 10% to 30% of the total cost of the order; for example, if a customer makes an order worth £20, the food delivery service may charge between £2 and £6. Consider the costs associated with each company before deciding which best suits your business.
An online ordering system
The fees associated with using an online ordering system are typically lower than using a food delivery company. Most companies have no fees associated with setting up your account. They may charge you a weekly or monthly fee (usually between £25 and £50 per month) or charge you a percentage fee for each order (usually between 2.5% and 10%). However, keep in mind that although the costs are lower compared to food delivery companies, you will have additional costs associated with marketing and advertising.
If you offer a delivery service yourself (rather than employing the services of a food delivery company) you will need to account for the costs associated with delivering food. This includes the hourly wage of your delivery drivers. Although delivery drivers tend to use their own vehicles, you will need to cover the cost of petrol and may need to pay for their business vehicle insurance. However, keep in mind that you can charge your customers a delivery fee for every order, which can help you to cover any associated costs.
These are the day-to-day costs associated with running your business. Some running costs are paid monthly, and others are paid quarterly or annually. Your running costs can include electricity, gas, water, council tax and insurance. To maximise your profits, try to keep your running costs as low as possible.
You will need to hire staff such as chefs and other kitchen staff, front-of-house staff and cleaners. You will need to pay any staff you employ at least the national minimum wage and account for other expenses such as holiday pay, sick pay, maternity/paternity pay, National Insurance and any company pension contributions.
When creating your brand identity, consider how you want your takeaway to be perceived by potential customers. When creating your brand, consider the type of takeaway business you are setting up, your menu and your typical customer base. Branding can include creating your business’s visual identity, design and aesthetic, your business name and logo, your signage and your website. You could hire a professional to help you with branding or do some or all of the work yourself. Branding can cost between £500 and £10,000, depending on the level of work required.
Advertising and marketing
To ensure your takeaway attracts customers and creates maximum profits, you will need to spend money on advertising and marketing. It is recommended that you spend between 1%–3% of your annual turnover on marketing. For example, if your annual turnover (or your desired annual turnover) is £100,000, you should spend between £1,000 and £3,000 on advertising and marketing. You may need to invest more money when you initially set up your business or when you are trying to grow your business. To reduce your costs, capitalise on free marketing strategies, such as on social media or in your local community. Once your business is established, you should be able to reduce your advertising costs. If you use a food delivery service, your advertising costs should be lower, as your customers will automatically be able to find your restaurant on the delivery app.
You and your employees will need to obtain food hygiene training before you open your business. You will also need to refresh your training regularly (at least every three years). You may also opt to undertake other training courses, such as manual handling, first aid and electrical safety. You can expect to pay approximately £20 + VAT per training course per person.
There are multiple coverage options available for a takeaway business. Some types of coverage are optional, whereas others are mandatory.
Your coverage options include:
- Public Liability Insurance.
- Employers’ Liability Insurance.
- Product Liability Insurance.
- Building and Contents Cover.
- Stock Insurance.
- Personal Accident Insurance.
- Food Contamination Insurance.
Prices can vary, depending on your insurance provider and the level of coverage you choose. Prices typically start at £15 per month.
Typical Pricing for Customers
Once you have calculated the typical costs associated with setting up and running a takeaway business, you can then price your menu. Each item on your menu will be priced differently.
Multiple factors can influence your pricing, including:
- The type of food you sell.
- Your location.
- Your reputation, customer rating and customer reviews.
- The popularity of your takeaway.
- Your food hygiene score.
- The cost of your food stock and ingredients.
- The complexity of each meal and how long it will take you to prepare and cook.
- Whether the order is for collection or delivery.
- The number of employees you hire.
- The pricing of other similar takeaway businesses in your area.
Safely Running a Takeaway Business
Safe practices in your takeaway business can help to protect the health, safety and well-being of you, your staff and your customers.
Some ways you can safely run your takeaway business are:
Safely store food
All food (regardless of whether it is perishable or non-perishable) must be stored safely to prevent contamination and to ensure it is of good quality and safe to consume.
Some safe storage practices you should follow include:
- Storage areas should be kept clean and tidy.
- Food deliveries should be checked to ensure they are safe and of good quality before accepting them.
- Follow the First In First Out (FIFO) stock rotation system.
- Pay attention to use-by and best-before dates.
- Fridges and freezers should be set to the correct temperature.
- Follow the storage instruction on pre-packaged food.
- Raw food and high-risk food should be stored correctly (e.g. below ready-to-eat foods).
- Foods containing allergens should be stored separately.
- Chemicals should be stored away from food.
- Chilled or frozen food should be labelled with the date.
Ensure proper ventilation
To reduce exposure to smoke, steam, high heat and harmful gases, you will need to install a proper ventilation system.
A ventilation system can:
- Improve your indoor air quality.
- Reduce the temperature of your kitchen.
- Reduce odours.
- Remove grease from the air, your surfaces and equipment.
- Reduce your energy bills.
Your ventilation system will likely also include fire suppression equipment, which can help reduce the likelihood of a fire occurring in your kitchen.
Ensure the personal hygiene of all staff
Good personal hygiene is essential when working in the food industry. Good personal hygiene can include:
- Implementing handwashing procedures.
- Tying back hair or covering hair.
- Not wearing false nails or nail varnish on your fingernails or any jewellery or watches when preparing or handling food.
- Not wearing strong perfume or other chemical products that could contaminate the food.
- Wearing Personal Protective Equipment (PPE).
- Following good habits, such as not coughing or sneezing near food and refraining from touching your hair or face.
You should also be aware of staff illnesses and ensure no employee is near food if they are displaying signs of illness or have recently experienced vomiting or diarrhoea.
Follow guidelines on foods that may contain traces of gluten or allergens
The Food Standards Agency has provided voluntary guidelines on labelling products that may contain traces of gluten or another allergen. For example, if the foods were prepared in the same area as gluten or an allergen, you should label your products accordingly so that your customers can make an informed decision.
Examples of the labelling terms you could use include:
- May contain traces of gluten.
- Made in a factory that also handles peanuts.
Implement pest prevention and control methods
Pests can be a major issue for food businesses and can result in contaminated food and your business being shut down by an Environmental Health Officer (EHO).
Some ways you can prevent pests are:
- Fill any gaps or holes in your building.
- Keep your external areas free from food, rubbish or vegetation.
- Dispose of food properly in closed bins.
- Keep your premises clean and tidy.
- Store food in sealed containers.
- Use fly screens on open windows or doors.
- Check your deliveries for signs of pest damage.
Implement cleaning procedures
A cleaning schedule or cleaning policies should be in place that cover the cleaning of equipment, surfaces, and food preparation and storage areas. Your cleaning procedures should specify when cleaning should take place and whether any specific equipment should be used.
Keep clear and accurate records
When you are inspected by the EHO, they will likely request to see up-to-date records of your business’s cleaning schedules, risk assessments, health and safety policies and allergen information. Keeping such records not only helps to protect your business and improve the likelihood of you receiving a higher score, but it also ensures procedures are followed at all times.
Conduct risk assessments
Although this is not a legal requirement if your business has fewer than five employees, risk assessments can help to eliminate risks and ensure safe practices in your takeaway.
As part of your risk assessments, you should:
- Identify hazards.
- Determine who could be at risk.
- Evaluate any potential risks.
- Implement relevant safety measures.
- Record the results of the risk assessment.
- Review the risk assessment regularly.
You should keep physical records of your risk assessments as evidence of your commitment to safe practices.
Implement safety measures
Safety measures can help to protect your business, your employees, your customers and your equipment.
Some safety measures you should implement include:
- Install a CCTV system.
- Install an alarm system and secure and reliable locks.
- Keep a fully stocked first aid kit on site.
- Other safety equipment, such as fire extinguishers, should be easily accessible.
- Wear Personal Protective Equipment (PPE).
Keep your floors clean
Slips and falls are one of the most frequent causes of injuries in food businesses. Slipping or falling on a floor that is wet or slippery can lead to an injury and could result in your business being sued. Implement a policy that any spills are mopped up immediately and ensure your premises has enough ‘Wet Floor’ and ‘Caution’ signs and that these are used when necessary. You should also perform regular inspections of your kitchen floor to check for any hazards that haven’t been reported.
Obtain health and safety training
Obtaining health and safety training can ensure that you and your employees follow safe practices at all times.
Some training courses you could opt for include:
- Assessing Risk.
- Health and Safety for Employees.
- Fire Safety Awareness.
- COSHH Awareness.
Complying with legal requirements is essential when setting up and running your takeaway business. Legal guidelines can vary, depending on the type of takeaway you set up and where your business is located.
Some of the legal requirements you should be aware of include:
Register as a food business
Any business in the UK that sells food must apply for a food business registration with their local council. You must apply for your food business registration at least 28 days before you begin trading. Once you have registered, you may be inspected by your local council.
Apply for a Food Premises Licence
If you plan to cook meat, fish, eggs or dairy products, you will need to apply for a food premises licence with your local council. Depending on your local council, you may need to display your licence clearly on your premises. Before you open your business, your local council may require your premises to undergo an inspection.
Display your food hygiene rating
If you cook, prepare, package or handle any food in your business, you will likely be required to undergo an inspection from the Environmental Health Office (EHO) to determine your food hygiene rating.
The inspector will assess your:
- Food storage.
- Food handling.
- Food preparation.
- Food cleanliness.
- Food safety management system.
Once you have received your food hygiene rating, this information should be clearly displayed on your premises.
Comply with the Food Safety Act (1990)
The Food Safety Act applies to any business that sells food. It covers food safety, consumer protection and food information. It makes it an offence to make or sell any food which could be harmful to health and lays out hygiene practices you should follow.
There are several legal requirements listed in the Food Safety Act, including:
- Do not add anything to food, remove anything from food or treat food in any way which could make it damaging to the consumer.
- Ensure that all food practices are carried out in a hygienic way.
- Comply with food hygiene and safety practices when cleaning, cooking, chilling and handling food.
- Do not present or describe food in a way that is false or misleading.
Comply with the Food Safety and Hygiene Regulations
These regulations specify the standards relating to the control and management of the steps that are critical to food safety, including the cleanliness of your takeaway premises and equipment and temperature control in food preparation, storage and serving.
The regulations differ depending on where in the UK your business is located:
- England: The Food Safety and Hygiene (England) Regulations 2013.
- Scotland: The Food Hygiene (Scotland) Regulations 2006.
- Wales: The Food Hygiene (Wales) Regulations 2006.
- Northern Ireland: The Food Hygiene Regulations (Northern Ireland).
Comply with The Food Information (Amendment) Regulations 2019
These regulations set out the responsibilities of food businesses, including takeaway businesses, to provide information regarding the 14 allergens (celery, cereals, crustaceans, eggs, fish, lupin, cows’ milk, molluscs, mustard, nuts, peanuts, sesame seeds, soya and sulphur dioxide). The regulations were updated in 2019 to include Natasha’s Law. You must ensure that any packaging, menus, signs or labels clearly state if any of these allergens are present. You could also state any allergen information orally on the phone when the customer places an order.
You must provide allergen information:
- Before the food is purchased.
- When the food is delivered (e.g. orally or in writing).
Implement a Food Safety Management System (FSMS) based on HACCP
The Hazard Analysis and Critical Control Point (HACCP) framework should be used in your takeaway to create a food safety management procedure. Your FSMS should be a systematic approach to controlling any food safety hazards.
It should include:
- Identifying any points in your processes where food hazards could occur and identify which of these points could be critical.
- Identifying and implementing monitoring and control procedures at all critical control points (CCPs).
- Regularly reviewing and analysing food hazards, CCPs and control procedures.
- If your takeaway offers a delivery option, you will also need to include information about temperature control and preventing spoilage in your HACCP or FSMS.
Comply with the four steps to food safety
The four steps to food safety (known as the Four Cs) can help to reduce contamination and reduce the likelihood of food poisoning.
- Cleaning: Cleaning helps to prevent harmful bacteria from contaminating food. Clean your hands and surfaces often. You should wash your hands for at least 20 seconds with soap and warm water before, during and after preparing food and after handling certain foods. You should also wash surfaces, chopping boards and utensils after preparing each food item.
- Cooking: Food must be cooked thoroughly to destroy any harmful bacteria. Check all food is cooked to a safe internal temperature or reheated thoroughly and it is piping hot before serving. When food is packaged for delivery, you must ensure it remains at a minimum temperature of 63°C when it reaches the customer.
- Cross-contamination: Cross-contamination can occur when harmful bacteria spreads between surfaces, equipment, hands and food. To avoid cross-contamination, keep different types of food separate (e.g. raw meat and other foods), use different chopping boards for different foods, keep cooked food separate, store foods correctly and thoroughly clean surfaces.
- Chilling: Chilling food correctly prevents bacteria from growing. Refrigerate stock as soon as it is delivered, ensure your refrigerator is set to the correct temperature and refrigerate perishable or cooked foods within two hours.
Transport takeaway food safely
There are several procedures you must follow when delivering food to your customers:
- Food should be delivered to customers in a way that ensures it does not become unsafe or unfit to eat.
- Any hot boxes or cool boxes must be cleaned and disinfected thoroughly before and after each use.
- The food temperature should be controlled (so that harmful bacteria do not spread). Hot food should be at least 63°C or above and cold food should be at 8°C or below (although between 0°C and 5°C is recommended).
- Takeaway packaging should be sourced from reputable suppliers and must be graded at an appropriate level for its intended use.
- Takeaway packaging should be stored in a clean and dry area to prevent cross-contamination.
- Any cross-contamination risks in the delivery process should be identified and removed.
Implement a waste management system
Food businesses in the UK, including takeaways, should have appropriate provisions for the separation, storage and removal of waste.
Some guidelines you should abide by include:
- Have appropriate bins which are sufficient in number and specified for different types of waste.
- Do not allow waste to accumulate.
- Use bins that have fitted lids and foot pedals.
- Have a specific waste disposal area.
- Do not dispose of food waste in the sink.
- Use commercial sink strainers to prevent fat, oil, grease and small bits of food from entering the sewer network.
- Apply for a waste carrier registration if you transport any waste.
It is also recommended that you clean and disinfect bins regularly.
Comply with premises regulations
Multiple regulations apply to your commercial premises to ensure your takeaway business is in good condition, clean and maintained and encourages good hygiene practices.
- Handwashing facilities: You will need separate handwashing facilities that have hot and cold running water and appropriate materials to allow hands to be washed and dried hygienically.
- Ventilation, lighting and drainage: Your premises must have adequate ventilation, lighting and drainage in all relevant areas.
- Food preparation areas:
– Floors and walls must be in good condition, easy to clean and frequently disinfected.
– Ceilings must be in good condition, easy to clean, free from condensation and mould and free from flaking paint or plaster.
– Windows and doors must be easy to clean and disinfect and if they open to the outside, fitted with removable insect-proof screens.
– Surfaces should be maintained in good condition, easy to clean and frequently disinfected.
- Facilities for washing food: Your premises will need separate sinks for washing food and cleaning equipment. These sinks should have hot and cold running water that is of drinking quality.
- Equipment: Any equipment that comes into contact with food must be in good condition and cleaned and disinfected frequently.
Comply with the Reporting of Injuries, Diseases and Dangerous Occurrences Regulations (RIDDOR) 2013
RIDDOR states that you must report all injuries, diseases and dangerous events that occur in your business. Reports must be made to the Health and Safety Executive (HSE) using an appropriate recording document. These regulations apply to any incidents that involve employees or customers, including reports of food poisoning.
Comply with the Control of Substances Hazardous to Health (COSHH) Regulations 2002
The COSHH regulations state that you must control any potentially hazardous substances. You should also assess, control and reduce any risks or potential hazards and protect people from harm.
Some hazardous substances you should be aware of are:
- Flour dust.
- Concentrates of flavour, citrus oils and spices.
- Cleaning substances.
Comply with the Provision and Use of Work Equipment Regulations (PUWER) 1998
PUWER regulations apply to you and any employees you hire. You must ensure any equipment in your takeaway restaurant is fit for purpose and is maintained and inspected regularly. You must also ensure that health and safety risks are minimised to an acceptable level, that you have the correct knowledge and training to use the equipment, and that protective measures are put into place. Equipment should also be used under appropriate conditions.
Comply with the Electricity at Work Regulations 1989
The Electricity at Work Regulations state that any workplaces that use electricals must construct electrical systems in a way that prevents danger. You must also maintain electrical systems to ensure they are safe, ensure electrical equipment is checked by a competent person annually and conduct Portable Appliance Tests (PAT). These regulations apply to any electrical cooking equipment (such as electric ovens and fryers) and any other electricals on your premises.
Comply with gas safety regulations
If you have a gas boiler or any equipment that uses gas, you will need to have it inspected by a gas-safe engineer. If your equipment is deemed safe to use and complies with government requirements, you will be issued a Gas Safety Certificate. You will need to display your gas certificate clearly for your guests and other visitors to your business to see.
Comply with fire regulations
As the business owner, you are responsible for fire safety measures on your premises.
There are multiple fire regulations you must ensure you comply with, including:
- Conducting a fire risk assessment.
- Complying with the Regulatory Reform (Fire Safety) Order 2005.
- Implementing any necessary fire safety measures.
- Implementing emergency procedures and ensuring these are clearly displayed.
Comply with the Manual Handling Operations Regulations 1992
Manual handling regulations can help to protect you and your employees from sustaining an injury or illness as a result of manual handling tasks. The regulations apply to the lifting or moving of any objects, bending down and reaching high and repetitive movements. You will likely be performing manual handling activities when carrying out tasks such as preparing food (e.g. chopping vegetables), handling heavy equipment and carrying food orders.
Appoint a competent person
A competent person should be appointed to help your business meet your health and safety legal duties. You can act in this role yourself or appoint another person to fulfil this role. The competent person should have the skills, knowledge and experience to identify any hazards in your business and put controls in place to protect people from harm.
Prepare a health and safety policy
The law states that every business in the UK must have a specific policy for managing health and safety. Your policy should state exactly how you will manage health and safety in your takeaway and state who is responsible for specific tasks and how and when these tasks are completed. Follow the recommended tips from the Health and Safety Executive when creating your health and safety policy. You should make your policy easily visible to any visitors to your business.
Comply with employment legislation
If you employ any staff, you must ensure you follow employment legislation, including the Employment Rights Act (1996) and the National Minimum Wage Act (1998). You must also comply with legislation relating to recruitment, working hours, sickness, discrimination, dismissals, and maternity or paternity pay.
Comply with the General General Data Protection Regulations (GDPR) and the Data Protection Act (DPA)
If you take orders online, you must comply with both pieces of legislation when storing or sharing personal information, such as your customers’ personal information, contact details and banking information. You must also apply for a Notification to Process Personal Data Licence. You will also need to apply for a licence with the Information Commissioner’s Office and renew your registration every year.
Register your business
You must register your business with HMRC before you begin operating. You can register as a sole trader or as a limited company. You will need to register your business name and any other relevant information.
Register for self-assessment tax
This allows you to calculate and pay your own taxes each year. You will need to track your finances every month and submit any expenses as part of your tax assessment.
As part of your tax responsibilities, you must:
- Record all forms of income and expenses.
- Complete an annual self-assessment tax return.
- Register for VAT if you earn above the threshold (currently £85,000).
- Pay National Insurance contributions.
- Keep a record of your business accounts for the previous five years.
Positives of Owning a Takeaway Business
Owning a takeaway business can be rewarding in many ways.
Some of the main pros associated with this type of business are:
Build your customer base
The wide range of takeaway options available means that many consumers try new takeaway restaurants and different types of cuisines. This means your business is likely to experience new custom. If your business is listed online, you are registered with a delivery service app or you are located in a busy area with high passing trade, you may experience a lot of new customers trying your food. If they enjoy their order, they may order from you again, recommend your takeaway to others or write a positive review.
Reduced overhead costs
Operating a takeaway rather than a sit-down restaurant can help you to reduce your overhead costs and running costs and maximise your profits. You will require fewer staff members, have reduced costs associated with renting your premises and will have increased efficiency.
Takeaways are in high demand
Even though many other types of businesses have failed or experienced significantly lower profits in recent years, the takeaway industry is stronger than ever. Many consumers got into the habit of ordering takeaways during the Covid-19 pandemic, and this trend has continued. With so many different types of foods and cuisine being popular in the UK, there is the potential for many different types of takeaway businesses to successfully co-exist and make a profit. Having high demand for your services makes it more likely that your takeaway business will succeed.
You can plan your menu to maximise your profits, for example, by using the same ingredients in multiple dishes. You can also add a markup to your dishes, meaning the price of the dish will significantly exceed the cost of the ingredients. A high-profit margin can help you to increase your profits and your business’s income.
Every day is different
Running a takeaway business will never get boring. Every day will be different and will present new challenges and different customers. You could be managing different staff every day, preparing different types of food and taking responsibility for different tasks. A varied workday helps to keep your job interesting.
A rewarding career choice
Running a takeaway business can be rewarding in many ways. You can have a positive impact on your community, connect with other people and see your business grow and succeed. If you love food and have a passion for cooking and the food industry, running a successful business will not only be financially rewarding but also personally rewarding.
You can be creative with your menu. You have the opportunity to be creative with your ingredients, flavours, textures and the presentation of your dishes to create the perfect products. If you love being creative in the kitchen, running a takeaway can be enjoyable and rewarding. You can serve any type of food you like and make creative changes to classic dishes to help your business stand out.
Be part of your local community
Takeaways are an important staple of local communities and make up part of an area’s identity, with many local people being familiar with the local takeaways and ordering food from them regularly. Running a takeaway business allows you to connect with people from your local community, both personally and professionally. You can also give back to the community, by donating to charity, hosting community events and hosting fundraisers.
A scalable business
A takeaway business can have a simple business model, making it easy to set up this type of business. If you want to grow your business, this type of business is highly scalable, as you will already have established strong business relationships with suppliers and wholesalers and will already have created a consumer base. There is always demand for takeaway businesses, giving you great opportunities for growth.
Unlimited income potential
There is no fixed income or limit on how much money your takeaway business can make. If you operate at maximum capacity, this allows you to increase your profits. As your business grows in popularity, you can also raise your prices, extend your premises, improve your menu and even open additional franchises of your business in other areas. A takeaway business has a high-income potential and with a solid business plan, can be extremely lucrative.
If your customers enjoy your food and service, they are likely to return time and time again. Many customers return to the same takeaway for years. Not only does this give you the opportunity to get to know your customers, but customer loyalty can also help you to grow your profits. Loyal customers may even recommend your takeaway to other people or write a positive review, which can help you to grow your customer base.
Create a positive work environment
You will be responsible for hiring staff and creating staff policies. This gives you the opportunity to create a positive work environment. You could hire staff that you know will bring positivity to your takeaway and will be an asset to your business. Your staff will also likely be like-minded people who are also passionate about food and beverages and also enjoy talking to customers. Many takeaways operate as a family business, which could be rewarding.
Choose your ordering strategy
There are multiple ordering strategies available for takeaway businesses, including in-person ordering, online or telephone ordering or using a food delivery service (such as Just Eats). Having the ability to sell on multiple avenues can increase your customer reach and increase your revenue streams. You can even change your selling strategy as your business grows and evolves.
As a takeaway owner, you won’t be sitting around staring at a computer screen all day. You’ll be active for a lot of the day, involved in different tasks, running your takeaway and talking to staff and customers. This is great for people who don’t want a traditional office job.
Choose your own schedule
You can choose which days your takeaway opens and the hours you want to work. You can choose the opening hours, based on your busiest days and your own preferences. As your business grows, you can also work fewer hours and allow your employees to handle the day-to-day running of your business.
Be your own boss
You can make all key decisions yourself and steer your business in whichever direction you choose. You can choose how involved you want to be, the type of takeaway you open, the food and beverages you sell and how you want to run your business. You can make the best decisions for you and your business.
Negatives of Owning a Takeaway Business
Although starting up a takeaway business can be rewarding, there are some potentially negative aspects to this type of business that you should be aware of:
Lower food quality
Putting hot food into closed containers and transporting it from one place to another changes the texture and temperature of the food. No matter what procedures you put in place, food served for takeaway will never be as high a standard as if you were to open a sit-down restaurant.
Lack of control
Once the food leaves your establishment, you have no control over the quality of the food by the time it arrives at your customers. The delivery driver could take too long to deliver it, the food could move around or fall apart, or the temperature could drop, and you will have no control over this. This could result in customers not returning to your takeaway or reviewing your business negatively.
The environmental impact
Even if you try to operate your business in an eco-friendly way, there will inevitably be a negative impact on the environment. This could come from single-use items, customers not properly recycling packaging and the carbon footprint associated with delivering food.
High start-up costs
The equipment needed for a takeaway business can be expensive. You will also be responsible for the rent and renovation costs. The high start-up costs mean you may need to source outside investment. It will also take longer for you to begin turning a profit. High start-up costs also make your business high risk, as you could potentially lose your investment if the business fails.
Spoilage can affect your profits
You will be dealing with a lot of perishable ingredients which spoil quickly. Some of the products you make or purchase will need to be used the same day to prevent them from spoiling or going stale and becoming food waste. This can have a significant impact on your profits, as the ingredients and time required to make them are wasted. Additionally, to save time your kitchen staff may pre-prepare and batch-cook many items on your menu and if these are not sold, the wasted ingredients can affect your profits.
High running costs and fees
To maximise sales, many takeaway businesses opt to list their business with a delivery service, such as Just Eat, Deliveroo or Uber Eats. Although this can result in a higher volume of orders, the associated fees can significantly affect your profits. Not only will you need to pay a sign-up fee but delivery services will also take a percentage of each order. Ingredients and stock can also be expensive, which can affect your profit margins and your overall income.
Long, unsociable working hours
Many takeaway restaurants open 6 or 7 days a week and try to maximise their profits by opening for longer hours. You may want to target lunchtime and dinnertime customers and open late at night, or until the early hours of the morning, to target customers on their way home from a party or night out. You will also need to account for the hours you will be working before and after your opening hours, to accept deliveries, prepare food and clean your premises. You may find yourself working more than 60 hours per week (particularly when your business is growing), which can be extremely tiring, both mentally and physically, and can impact your personal life.
Accountability and liability
The food industry is highly regulated with many laws and regulations you must be aware of. You need to ensure you follow all policies and procedures, particularly those relating to health and safety. Not only can it be time-consuming (and sometimes expensive) to ensure compliance, but failure to comply, even unintentionally, could have serious consequences. If a customer contracts food poisoning after eating food from your business you could be held liable.
Complying with legislation
There are many different pieces of legislation and legal guidelines you will need to comply with. Not only can this be complicated and time-consuming, but any non-compliance (even if this is accidental) can be punished with a fine or the forced closure of your business. Some types of legislation also require you to go through specific training and/or gain a qualification, which can be costly and arduous. A takeaway business can have high liability which can be a lot of stress and pressure on a business owner.
Because customers will not be eating the food in your establishment, you have less control over their experience and their reviews. You could receive negative reviews because of bad delivery service or cold food or because of a miscommunication in the order. Negative reviews can be extremely damaging to your business, particularly if your business is new or you’ve had relatively few reviews.
Not all items are delivery friendly
Depending on the type of food you plan to sell, you need to consider whether your items are delivery friendly. Fried food or bread can arrive soggy, vegetables can be wilted and ice cream or milkshakes can melt. Think about how your items will cope with sitting in closed containers and being transported when creating your menu. Because not all food items are appropriate for delivery, you may find you have to reduce or change your menu.
Fewer options to upsell
Takeaways typically experience lower average order values, as customers are less likely to purchase drinks, sides and add-ons. Because you will not be speaking to the customer directly, it can be more difficult to upsell items, for example, by offering starters and side dishes. This means you will need to increase your overall order volume to experience higher profits.
With so many takeaway businesses operating, you will face high competition. Not only will you be competing with other smaller takeaway businesses, but you will also be competing with large franchises, such as McDonald’s and Domino’s. A high level of competition can make it more difficult for your business to succeed.
Working in a takeaway can be physically demanding. You will be spending long hours on your feet every day and will be engaged in many physically demanding tasks, such as reaching high and bending low and carrying heavy items.
This can cause multiple health concerns, such as:
- Neck or back pain or strain.
- Pain, strain or injuries to your fingers, hands and wrists.
- Pain in your feet or legs.
It can be difficult to grow your business
It can be more difficult for a new takeaway business to grow and succeed because of the high competition. People often choose a takeaway they have visited before or that has been recommended to them, or they choose a takeaway business that has a high number of positive reviews online. It can be difficult to grow your customer base and you may experience slow business at first. This can have a detrimental effect on your income and profits. You may experience a lack of profitability in your first year of operation.
There are many staffing challenges you could face, such as a lack of staff motivation, customer complaints about staff and staff not fulfilling their expected duties. It can be difficult to create and maintain a positive work environment when working in such a busy, high-pressure environment. You will also have lots of responsibilities related to your staff, such as the hiring process, staff training, day-to-day management, staff rotas and staff payroll. While your business and your profits are growing, you may have to undertake many of these responsibilities yourself. You could also have a high staff turnover rate, which can result in a lot of time spent hiring and training staff.
Some days are likely to be busier than others and sometimes this can be difficult to predict. It could also be that you receive more business at certain times of the year. This can make it difficult for you to predict your profits, order your ingredients and plan how many of each product you should pre-prepare every day.
It can be stressful
There are many responsibilities associated with running a takeaway business which can be stressful. Not only will you be responsible for the day-to-day running of your business, but you will also need to ensure your customers are satisfied. You are also responsible for your business’s success, which can be stress-inducing.
Planning Your Takeaway Business
An effective and well-designed business plan is essential to the success of your takeaway business. A business plan can help you to focus on the specific steps that will help your business succeed, plan your short-term and long-term goals, determine your financial needs and help your business to grow.
When creating your business plan, ensure it contains information such as:
- Your company information.
- Your company description.
- The services you will provide.
- Your branding, marketing and advertising plan.
- The structure of your business.
- The operational plan for your business.
- The financial plan for your business.
Some of the factors you will need to consider when creating your business plan are:
The type of food you will focus on and your menu
This is the first consideration you will need to make when planning your business. You will need to decide what type of food or cuisine you are going to focus on (e.g. Chinese food or pizza). Once you have chosen your speciality, you can then create a menu. Creating a menu is a process that can take time and if you are not working in the kitchen, you may want to create your menu in partnership with kitchen staff. Your menu may change over time, but ensure it reflects your brand, the type of takeaway you want to operate and customer demand.
Your business location
Your location will have a significant impact on the types of customers you are likely to attract. It will also impact your premises’ rental costs. If your business is located in an area with high footfall or a place popular with your target market, the increased custom and higher profits will be extremely beneficial to your business. Consider your rental budget and your size requirements when choosing your premises.
Your target market
Determining your target market is a key step to helping your business succeed. Different types of takeaway restaurants and different menus are likely to attract different customers. Your pricing strategy will also be a key factor in determining your target market. Once you have identified your typical customers, you can then focus on how to attract them to your business.
Your local competition
Being aware of other takeaways in your area can help you decide what type of business to run and how much to charge your customers. If your local area already has several successful takeaway businesses, you may want to focus on an untapped niche and target different customers, for example, if there is already a successful Greek takeaway operating within close proximity, you may want to open a different type of takeaway or consider how to make your menu stand out.
Your primary selling strategy
This is a key consideration and can have a significant impact on the types of customers you attract and the success of your business. Will you offer delivery? Will you have a drive-through or counter-ordering? Will customers be able to find your business on food delivery apps and websites, such as Just Eat or Deliveroo? Whichever options you choose will require forward thinking before you begin setting up your business. You could choose to utilise a combination of different selling approaches in order to increase your sales. Your primary selling strategy could also change as your business grows.
Your brand and your unique selling point (USP)
Creating your brand is a key way to ensure you stand out from your competition. Branding can help you to focus your target audience, attract customers and concentrate your marketing and advertising strategies. Some ways you can create your brand are by focusing on your business’s visual identity, designing your menu and creating a brand story. Your USP can also be part of your brand and can help your business stand out from your competitors. Consider what makes your business special and how this fits into what defines your business.
Your marketing and advertising strategies
Marketing and advertising are especially important when you first open your takeaway business. Your marketing strategy needs to be effective and budget friendly. Consider your target customers and the best way to reach them.
Some ways you can market and advertise your business are:
- Build a functional and attractive website.
- Advertise in your local community.
- Offer special deals and introductory offers to build your customer base.
- Post leaflets and menus in your local area.
Your equipment and stock requirements
Consult the list above to determine your equipment requirements. The equipment you require will depend on the type of takeaway business you set up and how big your premises are. Once you have determined your equipment requirements, you can then calculate the initial costs of purchasing the equipment and the monthly replenishment costs, e.g. for stock and ingredients.
Your start-up costs and running costs
Consult the list above to help you calculate the approximate costs of setting up and running your business. Determine what equipment you need and the amount of equipment, as well as the cost of your premises, to help you determine your start-up costs and what your initial investment requirements will be. You can then calculate whether you can finance your business yourself or whether you need to source outside investment, for example, from a bank or an independent investor. Determining your start-up costs and running costs can also help you to create a budget and predict when you will begin to turn a profit.
Financing your business
Consult the list of start-up costs and running costs above to determine what capital you will require. Can you finance the business yourself or will you need to source outside investment? You will also need to calculate when you are likely to begin turning a profit. If you require outside investment, you could consider a bank or other financial institution, a business loan or an investment partner.
Your price points
When determining the pricing of your menu, consider the cost of your stock and ingredients and the time it will take to make each dish. You should also take into account the pricing of your competitors.
Your sales forecast
How many orders do you hope to have each day, week and month? Are there certain days of the week or times of the year that are likely to be busier than others? What are your weekly, monthly and annual sales forecasts? As your business grows, your sales forecast is likely to change.
Your strategy for growth
Your strategy for growth is the actions you will take to realise your goals for expansion and any potential challenges your business could face and how you will avoid or overcome them. This can help to make your business more successful.
Potential challenges could include:
- Issues with your suppliers.
- A lack of orders.
- Issues with the delivery.
Some potential strategies for growth include:
- Expand your menu.
- Hire more delivery drivers and kitchen staff.
- Open a secondary business location.
Your business summary
Your business plan should include a detailed overview of your business, including the type of business you are setting up, the type of food you sell and your menu, your primary selling strategy, your typical customer base, your staffing and equipment requirements and your business goals.
Your business goals
Your business goals or objectives are an essential part of creating your business plan. Your business objectives highlight the targets and goals of your takeaway business and help you to create a one-year, three-year and five-year business plan.
Your business objectives should be SMART:
- S = Specific
- M = Measurable
- A = Achievable
- R = Realistic
- T = Time-bound
Check you have complied with all legal requirements
Consult the list of legal requirements above to check you have complied with all requirements and regulations and that all your paperwork is accurate. Failure to comply with legal requirements could have a detrimental effect on your business or could result in a fine, the forced closure of your business or, in serious cases, prosecution.