How to Start a Catering Business

To start a catering business, you need three things before you cook a single dish for pay: a legal food-prep space (a licensed commercial or commissary kitchen), the right permits and licenses (a health permit plus food handler or manager certification and, in many places, a catering license), and a registered business with an EIN. Once those are in place, you pick a niche, price your menus per head, and land your first events through venues and referrals. That, in plain terms, is how to start a catering business the right way and stay on the right side of health inspectors.

Catering is one of the friendlier food businesses to launch because you cook to order, control your volume, and often skip the rent of a full restaurant. But the food-safety rules are real, and they trip up first-timers. Here is the ordered path.

How do you choose a catering niche?

Do not try to cater everything. Your niche shapes your menu, your equipment, your pricing, and who you market to. The three most common starting points:

Corporate and office catering. Steady weekday demand, repeat clients, and simpler logistics (breakfast spreads, boxed lunches, meeting platters). Margins are modest but volume and predictability are excellent.
Weddings and social events. Higher price per head and big-ticket bookings, but seasonal, labor-heavy, and stressful. Great once you have a team and a portfolio.
Drop-off catering. You prepare the food and deliver it ready to serve, with no on-site staff. This is the lowest-overhead way to start: fewer servers, less equipment, faster turnaround.

Many owners begin with drop-off or corporate work to build cash flow and reputation, then expand into full-service events. Pick one lane, get good at it, and let referrals pull you into the next.

Do you need a commercial or commissary kitchen?

Almost always, yes. In the vast majority of US states and counties, you cannot legally prepare food for sale in your home kitchen. Cottage food laws exist, but they typically cover only low-risk shelf-stable items like baked goods or jams, not the hot, perishable food catering runs on.

Your realistic options:

Commissary kitchen. A licensed shared kitchen you rent by the hour or month. This is how most caterers start. You get an inspected, permit-ready space without buying or building one.
Renting off-hours from a restaurant, church, or event hall. Cheaper, but confirm the space is properly licensed and your local health department will list it as your operating base.
Building your own commercial kitchen. The most expensive path, worth it only once your volume clearly justifies it.

Your health permit is tied to a specific approved kitchen address, so lock this down before you apply for anything else.

What permits and licenses does a caterer need?

Requirements vary by state and county, but a typical caterer needs most of the following:

Health permit (food service permit). Issued by your county or city health department after they approve your kitchen. This is the non-negotiable one.
Food handler certification for anyone touching food, plus a certified food protection manager credential (often ServSafe) for at least one person on staff.
Catering license or caterer's permit. Many jurisdictions require a specific catering endorsement on top of the general health permit.
General business license from your city or county to operate at all.
Seller's permit / sales tax license if your state taxes prepared food, so you can collect and remit sales tax.
Liquor or catering alcohol permit if you plan to serve or handle alcohol at events.

Because the exact mix depends on where you operate, call your county health department early and ask them to walk you through their catering checklist. For a broader overview of how these pieces fit together, see our guide to licenses and permits.

How do you set up the business legally?

Get the legal foundation in place before your first paid gig:

Choose a structure. Most caterers form an LLC for liability protection, which matters when you are serving food to hundreds of people. Sole proprietorships are simpler but leave your personal assets exposed.
Register the business with your state and file a DBA if you operate under a brand name.
Get an EIN from the IRS. It is free, takes minutes online, and you will need it to open a business bank account, hire staff, and file taxes.
Open a business bank account so your catering income and expenses never mix with your personal money.

If you want the full sequence from idea to open, our general startup checklist lays out every step in order.

What insurance does a catering business need?

Food is high-liability, and venues will ask for proof of coverage before they let you in the door. Plan on:

General liability insurance for property damage and accidents at events.
Product liability in case someone gets sick from your food.
Commercial auto if you deliver.
Workers' compensation once you hire staff, which most states require.
Liquor liability if you serve alcohol.

Many venues require you to name them as an additional insured on your certificate, so ask your agent to make that easy to issue.

What equipment and startup costs should you expect?

Because you can rent kitchen space and much of the serving gear, catering can start lean. A realistic first-timer range is roughly $10,000 to $40,000, depending on your niche and how much you rent versus buy. Common line items:

Commissary kitchen rental (monthly or hourly)
Transport gear: insulated food carriers, chafing dishes, coolers, sheet pans
Serving equipment: platters, utensils, linens (rent these for large events at first)
A reliable vehicle or van for delivery
Permits, certifications, and insurance premiums
Branding, a simple website, and initial marketing

Tip: Rent, borrow, or sub-rent big equipment for your first several events. Do not buy a $3,000 convection oven or a van full of chafers until real bookings prove you need them.

How should you price catering per head and by package?

Most caterers price per person, then bundle menus into tiered packages. To set a sustainable per-head price, add up your food cost, labor, rentals, delivery, and overhead for a given menu, then mark it up so food cost lands around 28 to 35 percent of the price. Build three tiers, for example a simple drop-off package, a mid-range buffet, and a premium full-service option, so clients can self-select by budget.

Always set a minimum guest count or order minimum so small jobs stay profitable, and add clear line items for delivery, staffing, and rentals rather than burying them. For a step-by-step method, read pricing your packages.

How do you land your first catering events?

Your first bookings almost always come from relationships, not ads:

Partner with venues. Event halls, breweries, and coworking spaces keep preferred-caterer lists. Getting on one means steady referrals with no marketing spend.
Ask for referrals. Cater one office lunch or small party well, then ask the host to recommend you. Word of mouth is the engine of this business.
Do a strong first job at cost. A well-run event with great photos becomes your portfolio and your best salesperson.
Network with event planners and wedding coordinators, who book caterers constantly.

For a repeatable system to fill your calendar, see book your first events.

This is general information, not legal or tax advice; food rules vary by state and county.

Frequently asked questions

Can I start a catering business from my home kitchen?

In most states, no. Health codes require food for sale to be prepared in a licensed commercial or commissary kitchen. A few cottage food laws allow limited low-risk items, but not the perishable, hot food typical of catering. Check with your county health department.

How much does it cost to start a catering business?

Many first-timers start for roughly $10,000 to $40,000 by renting kitchen space and serving equipment instead of buying it. Drop-off catering sits at the lower end; full-service wedding catering costs more.

Do I need a license to cater events?

Yes. You typically need a health permit, food handler or manager certification, a general business license, and often a specific catering license, plus a seller's permit if your state taxes prepared food. Requirements vary by location.

Keeping permits, kitchen approval, insurance, and pricing straight is a lot for one person. Scafflow gives first-time owners a personalized, ordered checklist across Legal, Finance, Brand, Website, Marketing, Customers, and Operations, so nothing slips through the cracks. It is free to start.

Ready to cook?

Build your free catering checklist and get a clear, step-by-step path from permits to your first booked event.