A home catering service business is a business that operates from home and provides food service at a remote site such as a cruise ship, hotel, park, hospital, pub, aircraft, filming site or studio, event venue, or entertainment site (wedding parties, birthday parties et al).
According to the information that is currently available, Canada’s catering market size peaked in 2019 at 3.75 billion US dollars.
The coronavirus (COVID-19) pandemic caused the market to shrink, falling to $3.35 billion in 2020. According to Technavio’s most recent industry analysis, the catering services market will increase by USD 104.92 billion between 2020 and 2025, rising at a CAGR of 4.4 percent.
Steps on How to Start a Catering Business from Home in Canada
Table of Contents
Conduct Market Research
In order to optimize revenue from the business, someone launching a home-based catering operation needs to conduct trustworthy market research. Please take note that the first stage in conducting market research for your home-based catering business should be to create market-based research questions that are consistent with your main goals and objectives.
In this regard, you should look for information that will provide you with trustworthy data, information that will give you an idea of what your potential market will be looking for in a catering business, information that will also help you run your home-based catering business with less stress, and help you grow the business to profitability.
a. Who is the Target Market for Catering Business?
- Graduation Parties
- Wedding Planners
- Business luncheons and Trade Shows
- Annual General Meetings
- Event Planners
- Corporate Organizations
- House Parties
- School Events
- Birthday Parties.
b. Is Catering Business from Home in Canada a Profitable Business?
Yes, the catering business is indeed a profitable business. According to credible statistics, a catering firm can make up to 20% from a single catering contract, all other things being equal. A food truck or restaurant business is unlikely to make that much from a whole day’s worth of work.
However, in general, catering profit margins far exceed those of the typical full-service restaurant. It is considerably closer to the fast food and food truck margin.
c. Are There Existing Niches in the Industry?
No, there are no existing niche ideas when it comes to catering business from home. This is so because catering business from home is a niche idea in the catering and food services industry.
d. Who are the Major Competitors?
- CLS Catering Services
- Big City Catering Services Toronto
- Cole’s Catering Services
- Culinary Catering Services
- Elizabethan Catering Services
- The Chef’s Hat Catering
- Encore Catering
- Elle Cuisine
- Top Notch Catering
- The Food Dudes
- Decadent Catering & Fine Foods Inc.
- Sugar Catering
- Chef Paul’s Catering
- Daniel et Daniel Catering & Events
- Cravings Fine Food & Catering
- 10tation Event Catering
- Kitchen Door Food Co
- The Catering Company
- Freshly Made Catering
e. Are There County or State Regulations or Zoning Laws for Catering Businesses from Home in Canada?
Yes, there are county and provincial regulations and zoning laws for catering businesses in Canada. A license is required by the Safe Food for Canadians Act (SFCA) and Safe Food for Canadians Regulations (SFCR) for food businesses to operate in accordance with the laws governing food.
The SFCR determines whether you require a license based on the activities you engage in, not the kind of business you operate.
f. Is There a Franchise for Catering Business from Home in Canada?
No, there are no franchise opportunities for catering businesses from home in Canada.
g. What Do You Need to Start a Catering Business from Home in Canada?
- A Feasibility Report
- Business and Marketing Plans
- Business Licenses and Permits
- A Good Catering facility
- Goods and Services Tax/Harmonized Sales Tax (GST/HST)
- A Corporate Bank Account
- Suppliers of food ingredients and drinks
- Startup Capital
Choose a Memorable Business Name
When looking to start a business, before you can begin to file the necessary documents with the constituted authorities or start your website, it is necessary that you come up with a name that you will be recognized with. It is essential that the name you come up with can easily be pronounced, is unique and easily memorable.
Some of the catchy business name ideas suitable for a catering business are;
Creative Catering Business Name ideas
- Lovelyn Morgan© Home Catering Services, Inc.
- Chef Windsor® Catering Services, Ltd.
- Rita Foods© Caterings Services, Inc.
- Stella Walter® Caterings Services, Inc.
- Calgary Culture™ Caterings Services, Inc.
- Delight Taste™ Caterings Services, Ltd.
- Food O’clock© Caterings Services, Ltd.
- Fresh Pots® Caterings Services, Inc.
- Catherine Caterers© Caterings Services, Inc.
- Ellen Halland© Caterings Services, Inc.
- Chef Rosa® Caterings Services, Ltd.
- Golden Fingers™ Caterings Services, Ltd.
- Mississauga Caterers© Caterings Services, Inc.
- Chef Kathleen® Caterings Services, Inc.
- Regina Caterers™ Caterings Services, Inc.
- Halifax Cooks™ Caterings Services, Inc.
- Chef Jacinta© Caterings Services, Inc.
- Julliet Landrum® Caterings Services, Ltd.
- Grand Style© Caterings Services, Inc.
- Chef Alice© Caterings Services, Inc.
Register Your Business
a. What Type of Business Structure is Best for Catering?
You have four alternatives for business structures when creating a catering business in Canada, but the corporation is the one that most people in this industry take into account. Because a corporation has limited liability—the owners are not liable for the debts or liabilities of the business.
Obtaining funding from investors or financial organizations is simpler. Additionally, it is necessary to be incorporated in order to transact business with governments or other companies, and business income can be distributed in the form of dividends or salaries, allowing you to minimize your tax liability.
Please note that all Canadian businesses must register their names in their respective provinces or territories, with the exception of sole proprietorships that use only the owner’s legal name without any additions (except in Newfoundland and Labrador, where neither partnerships nor sole proprietorships are required to register their names).
b. Steps to Form a Corporation in Canada
You must complete these steps in order to become a corporation:
- Whether it’s a federal or provincial/territorial incorporation, register your business.
- Contact the Canada Revenue Agency to open a corporate income tax account and obtain a federal business number (CRA).
- In all other Canadian jurisdictions where you want to conduct business, register as an extra-provincial or extra-territorial corporation.
c. What Type of License is Needed to Open a Catering Business in Canada?
- General Business License
- Health and Safety Permit
- Food Handler’s License
- Liquor license
- Health and trade license
- Lift clearance license
- Zonal Permits
- Signage Permit
- Operational State Facility Inspections for your kitchen
d. What Type of Certification is Needed to Open a Catering Business in Canada?
These are some of the certifications you can work towards achieving if you want to run a catering business in Canada;
- Clean Health Certificate
- Food handler Certification
- Catering Training Certificate
e. What Documents are Needed to Open a Catering Business in Canada?
- Goods and Services Tax/Harmonized Sales Tax (GST/HST)
- Council Permit
- Business and liability insurance
- State Permit and Building Approval
- Certificate of Incorporation
- Business License
- Business Plan
- Contract Document
f. Do You Need a Trademark, Copyright, or Patent?
If you plan to open a catering business in Canada, you probably won’t need to file for trademark protection or intellectual property protection. This is true because the nature of the business makes it possible for you to run the company successfully without needing to take legal action against anyone who uses your intellectual property.
Cost Analysis and Budgeting
a. How Much Does It Cost to Start a Catering Business from Home in Canada?
You should budget slightly above $65,000 CAD to be able to successfully launch a catering business from home in Canada.
b. What are the Costs Involved in Starting a Catering
- Business Registration Fees – $750.
- Legal expenses for obtaining licenses and permits – $3,300.
- Marketing, Branding, and Promotions – $2,000.
- Business Consultant Fee – $2,500.
- Insurance – $2,400.
- Rent/Lease – (Since you will be operating from home, you should ignore this expenditure)
- Operational Cost (salaries of employees, payments of bills et al) – $20,000
- Start-up Inventory – $5,000
- Catering Equipment and Wares – $25,000
- Website: $600
- Opening party: $3,000
- Miscellaneous: $2,000
c. What Factors Determine the Cost of Opening a Catering Business in Canada?
- The size of the catering business
- The choice of location
- The required licenses and permits
- The type of food and services (catering rental services)
- The cost of branding, promotion, and marketing of the catering business
- The cost of the insurance policy covers
- The cost of registering the business
- The cost for the purchase of catering equipment and wares
- Source of your food ingredients, supplies, and ongoing expenses
- Cost of recruiting and training your staff
- The cost for the purchase and customizing of uniforms
- The cost for the grand opening of the catering business
d. Do You Need to Build a Facility? If YES, How Much Will It Cost?
You don’t need to build a facility for your catering business since you will be operating from home.
e. What are the Ongoing Expenses of a Catering Business from Home in Canada?
- Supplies (inventory expenses)
- Utility bills (internet subscriptions, phone bills, signage and software renewal fees et al)
- Transport and logistics
- Salaries of employees
f. What is the Average Salary of your Staff?
- Chief Caterer (Owner) – $50,000 Per Year
- Cooks (Assistants) – $30,000 Per Year
- Waiters/Waitress (Contract) – $28,000 Per Year
- Cleaners – $25,000 Per Year
g. How Do You Get Funding to Start a Catering Business in Canada
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell shares to interested investors
- Applying for a loan from your bank/banks
- Source for soft loans from your family members and friends.
Write a Business Plan
a. Executive Summary
Ellen Halland© Caterings Services, Inc. is a catering business that will be based in Vancouver, British Columbia, Canada. Our intention of starting a catering business in Vancouver, British Columbia is to deliver the best quality catering services at an affordable price to a wide range of customers.
Our services will involve catering for parties, outdoor events, weddings, holiday parties, birthday parties, corporate events, picnics, anniversaries, special events et al.
As part of our plans to make our customers our number one priority, we have perfected plans to work with our clients to provide customized services based on their budgets. We will be involved in delivery services, rentals services, event management, and consultancy services.
b. Products and Service
- Local food sales
- Intercontinental food sales
- Small chops and snacks
- Catering wares and equipment rentals
c. Mission Statement
Our mission is to establish a standard catering business that will meet all the catering needs (cooking, event planning, rentals, training, and consultancy services) of people in Vancouver, British Columbia and neighboring cities in the province.
Our vision is to become the leading home catering brand in Vancouver, British Columbia.
d. Goals and Objectives
The goals and objectives of a catering business are to provide food service at a remote site or a site such as a cruise ship, hotel, park, hospital, pub, aircraft, filming site or studio, event venue, or entertainment site (wedding parties, celebration parties, and birthday parties et al).
e. Organizational Structure
- Chief Caterer (Owner)
- Cooks (Cooking Assistants)
a. SWOT Analysis
- Ideal location for a catering business in Canada
- Highly experienced and qualified caterer
- Availability of different types of delicacies
- Moderately priced menu
- Reliable and efficient inventory management system.
- Financial constraints may restrict the publicity and branding of the business
- A new business that will be competing with well-established catering businesses in the city.
- A rise in the number of people who would want to organize events that will require the services of caterers within our market space
- Online market, new services, new technology, and of course the opening of new markets.
- The arrival of a new catering services business within our market space
- Economic uncertainty
- Liability problems
- The government could change its regulatory status and decide to enforce strict regulations that can strangulate new businesses like ours.
b. How Do Catering Services Businesses Make Money?
Catering services businesses make money by preparing and serving;
- American food sales
- Intercontinental food sales
- Catering equipment and wares rentals
c. Payment Options
- Payment via bank transfer
- Payment via credit cards
- Payment via online bank transfer
- Payment via check
- Payment via mobile money transfer
- Payment via bank draft
d. Sales & Advertising Strategies
- Introduce your catering business by sending introductory letters alongside your brochure to event planners, park managers, hotels, schools, religious organizations, clubs, corporate organizations, households, and other key stakeholders throughout the city where your catering business is located.
- Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, and LinkedIn to get your message across
- Create a basic website for your business so as to give your business an online presence
- Directly market your catering.
- Advertise our business in community-based newspapers, local TV and radio stations
- List your business on yellow pages ads (local directories)
- Encourage the use of word-of-mouth marketing (referrals)
a. How Much Should You Charge for your Product/Service?
The amount a caterer charge in Canada depends on some factors, for example, if a caterer wants to cater to 100 guests, they will charge about $1,200 for drop-off and $2,500 for buffet-style services. The services the caterer is offering and the type of food will determine the amount they will charge.
b. How Much Profit Do Catering Owners Make a Year in Canada?
It depends, but the available report shows that on average, catering business owners make anywhere from $25,000 a year to $120,000 and above.
c. What Factors Determine the Amount of Profit to Be Made?
- The capacity of the catering business
- The types of food, snacks, and other services
- The location of the catering business
- The management style of the catering business
- The business approach of the catering business
- The advertising and marketing strategies adopted by the catering business.
- The number of years the catering business is in business
d. What is the Profit Margin of a Catering Business?
A basic guideline in the catering business is to keep food cost percentages between 28 and 32%. But rather than being a general rule that applies to all catering businesses, this is more of a recommendation.
e. What is the Sales Forecast?
Below is the sales forecast for a catering business. It is based on the location of the business and other factors as it relates to such startups in Canada;
- First Fiscal Year: $250,000
- Second Fiscal Year: $320,000
- Third Fiscal Year: $450,000
Set Up your Shop/Office
a. How Do You Choose a Perfect Location for Catering Business in Canada?
- The demography of the location especially as it relates to families and the frequency of parties and events
- The demand for catering services in the location
- The purchasing power of the residents of the location
- Accessibility of the location and the road network
- The number of catering businesses in the location
- The local laws and regulations in the community/state
- Traffic, parking and security et al
b. What Province and City are Best to Open a Catering Business in Canada?
- Toronto, Ontario
- Calgary, Alberta
- Quebec City, Quebec
- Charlottetown, Prince Edward Island
- Saskatoon, Saskatchewan
- Nova Scotia, Halifax Manitoba, Winnipeg
- Mississauga, Ontario
- Vancouver, British Columbia
- Kitchener, Ontario
- Hamilton, Ontario.
c. What Equipment is Needed to Operate a Catering Business from Home in Canada?
As expected, before you can open a catering business, you will need cooking gas, deep freezers, fridges, blenders, serving utensils (plates, ashtrays, glasses, flatware), and drums et al.
When it comes to hiring employees for a standard catering business, you should make plans to hire a competent chief caterer, caterers (cooking assistants), waiters and waitresses, and cleaners.
Launch the Business Proper
No catering business opens its doors for business without first planning an opening party to formally launch the business. If you are on a tight budget, you could do a soft opening celebration instead of a grand opening event. Alternatively, you might want to do both.
The bottom line is that by properly launching your catering business, you will be able to formally let residents of your community know that you are open for business.
a. What Makes a Catering Business in Canada Successful?
- Choose a good location to launch the business
- Make sure you offer a wide variety of foods (give your customers options)
- Throw an open house grand party before officially opening the catering business in Canada
- Be deliberate with your marketing sales approach
- Encourage the use of word of mouth to promote your catering business in Canada
- Leverage all available online and offline platforms to promote your catering business in Canada
b. What Happens During a Typical Day at a Catering Business?
- The catering business is open for the day’s work
- The caterers (cooking assistants) prepare the food
- Foods are delivered to customers or event venues as requested
- Stocks are taken and reports are written and submitted to superior officers
- The business is closed for the day.
c. What Skills and Experience Do You Need to Build a Catering Business in Canada?
- Excellent culinary skills
- Excellent customer services skills
- Interpersonal skill
- Accounting and bookkeeping skills
- Business management skills
- Bargaining skill
- Work experience in a catering business environment or niche catering
- Experience in managing people
- Experience in business administration
- Experience in preparing a wide variety of delicacies.