Meal prep businesses are popping up all over the place, but it's important to research before investing your time and money in a new business idea. A lot goes into starting a business, and it can be overwhelming if you don't know where to start. We have gathered resources to help you navigate the process of starting a business. From business plans to marketing strategies, we have you covered.
Types of Meal Prep Businesses
There are several ways to set up your very own meal prep service. You can either choose a franchise or set up your own business from scratch.
It's vital to do your research and find the best franchise opportunity that suits your needs and goals. A franchise will often come with a proven business model and a step-by-step process for setting up your own business. On the other hand, if you decide to set up your own business from scratch, you will have more flexibility in terms of how you want to run it.
There are several things to consider when deciding which type of business to set up, including your skills and interests, as well as how much time and money you are willing to invest.
One popular option is uncooked, prepared meal ingredients. These meal-making kits generally consist of delivery of all the ingredients required for a meal, in the exact portions, with easy-to-follow instructions provided. Another meal prep business option is offering pre-made and fresh meals. You can do all the cooking yourself and deliver a week's worth of meals right to your customers' doors. All they have to do is heat their prepared food.
A third option would be to host meal prep workshops. The business provides and prepares the ingredients for the meal and the kitchen to cook in. Your customers will cook their recipes and take their meals home.
List of Meal Prep franchises and costs
There are many different franchises to choose from and a variety of costs associated with each. Some franchises are more expensive than others, and some are less expensive but may have higher startup costs. Depending on your chosen franchise, you can expect to pay anywhere from $10,000 to $150,000. Some franchises, such as marketing franchises, are less expensive to start up but will require a significant investment in advertising to bring in customers. Other franchises will require a smaller initial investment but also charge a higher percentage of your sales.
LeanFeast -$70,000
Upfresh- $100,000
Salad Station - $200,000
As the franchisor, LeanFeast will provide guidance throughout the entire buildout and planning process, the development of your first location, and in the on-going operation thereafter, to make the process as seamless as possible. The only meal prep franchise in the country that teaches the franchisees how to operate their own kitchen & maximize profits for the store owner.
LeanFeast Franchise OptionsUpFresh Kitchen is an innovative, diversified business model that provides healthy, convenient, and delicious options for busy customers. Founded by an RN and wellness coach who saw a need for delicious, affordable, convenient meal assembly plans for busy people who want to feel good about the food they put in their bodies.
Upfresh Franchise OptionsFounded by a Louisiana farming family, Salad Station has quickly set itself apart from the competition by offering over 100 salad ingredients, and gourmet hot foods. They continue to innovate the menu, most recently adding on-the-spot chop-and-wrap options.
Salad Station Franchise OptionsHow much does it cost to open a Meal Prep Business?
The prices can vary from as little as $8,000 to way over $200,000 to start a Meal Prep Business. If you want to use your kitchen, it will be a very cost-focused option for your business startup. Still, you will have to renovate your kitchen to pass health guidelines set by your state. . These costs can go up exponentially as you buy equipment, rent out retail space, or even partner with a franchise.
Writing a Meal Prep Business Plan
When starting a meal prep business, it's never too early to write the business plan. A business plan serves as a guide for every aspect of your new business. Your road map will take you from an idea to a full-fledged company.
Some of the items you should include in your business plan include:
Choose a Niche and Business Name
Executive Summary
Company Description
Market Analysis
Management
This could be the hardest part of starting any meal prep business. There are resources out there to look up options for niches. You will want to pick something that gives your customers a wide variety of selections and gives an immediate sense of what your meal prep business will offer. Some common niches are a diabetic-focused, gluten-free, senior citizen, dairy-free, high-protein, and vegetarian.
This is an overview of your business’s vital information. The concept, target market, why the meal prep business stands to succeed, a financial overview, and even funding needs. You'll want to list out your overall goals for the business here and what exactly you'll be offering.
Company description is a short paragraph or paragraph that describes your company’s products. The main purpose of the company description is to sell your business to your potential customers. It will provide additional details about what the business is all about. A mission statement on why your business exists or why your business is unique.
This is the outlook for the meal prep industry and independent research to support what the industry demands and your potential for success. Include, statistics about industry growth, size of your target market, competitors, growth opportunities, and even challenges.
The organizational chart is a simple, visual way to represent the chain of command within a company. Management plans are crucial for any organization because they help keep things organized and ensure everything runs smoothly. They also help keep employees accountable and on task. Ideally, your management plan should cover every aspect of your business, from hiring to firing to onboarding new employees. A good management plan makes sure you have your bases covered and that you're prepared for any situation.
Management/Organization Chart TemplateIdentify your products and services
Sales and Marketing
Financial Projections
Funding Request
Details about the meal prep items you’ll serve and how your customers will receive them. Your pricing, unique qualities, even what products you offer.
Information about how you will attract customers and generate awareness about your meal prep business. How will you advertise, your logo, what social media will you use, how much do you expect to spend on marketing.
Sales and Marketing Plan Template
Reports that provide insight into your business’s anticipated revenue and profitability. Break-even analysis, profit and loss statement, balance sheet, cash flow statement for at least the next five years.
Financial Projections Template
This section will describe to investors the details about your funding needs. For example: how much money you will need from investors to launch your business, what will you use funding for, how do you intend to repay loans or return an investment, what opportunities will the funding open up for your business?
How to Get a Startup Loan for your Meal Prep Business
There are many lenders out there that offer "startup loans" (often referred to as "business loans"), which are loans that are designated to be used for business purposes. These can be an excellent way to fund your new business if you don't have the upfront capital needed to purchase the necessary equipment.
One of the best ways to find a lender that may be open to giving you a startup loan is to shop around. You may be surprised at how many different options you have, even if you have less-than-perfect credit.
Another thing you can do is make sure that you are creating a solid business plan. When you are applying for a startup loan, the lender will most likely want to see that you have a plan for how you will use the money they give you.
Here are a few examples of startup loans you may be able to apply for:
Personal Loans
Microloans
Business Term Loan
Business Line of Credit
Equipment Loans
Small, easy to obtain loans based on credit score. Many lenders offer personal loans with a wide range of interest rates and terms, making it easy to find a loan that suits your needs.
Some providers offer microloans for small businesses. These are smaller loans, usually between $1,000 and $25,000. There are some requirements for these loans, such as a minimum credit score.
If you’re looking to finance a retail space for your meal prep business, a term loan may be the right choice for you. Term loans usually have fixed rates and fixed terms, which means the rate stays the same throughout the duration of the loan.
If you want to open a meal prep business and need financing, you can get a business line of credit to purchase inventory, supplies, and equipment. Most business lines of credit have a maximum amount that can be borrowed, and you will need to meet the requirements to qualify for the credit, which may include a history of profitable operations.
You may be able to get a low-interest loan through the USDA to purchase equipment that will help you grow your business. Interest rates on these types of loans are usually lower than the rates on a normal business loan. Equipment loans are often easier to qualify for than other types of loans.
How to get Meal Prep Equipment Financing?
There are several ways to get meal prep equipment financing. You can apply for a traditional bank loan, seek a commercial lender, or try a financing company. Depending on the cost of your equipment and your credit, you may be able to get a traditional bank loan. If you have less-than-perfect credit or need a large amount of financing, you may want to explore equipment leasing options.
Get Meal Prep Equipment FinancingOrdering Meal Prep Equipment
There are several different options for meal prep equipment, from store-bought products to more expensive, higher-quality offerings. The best meal prep equipment will depend on your individual needs, but most come with some combination of these features. Most meal prep equipment is made with plastic, silicone, or stainless steel, all safe materials. These products are often dishwasher-safe, making cleanup easy. Many products allow you to custom-cut your food and maximize portion size.
Order Meal Prep EquipmentMeal Prep business equipment checklist
Food Permits & Licenses
The U.S. Department of Agriculture (USDA) regulates the licensing of commercial food vendors. Vendors who sell food to the public must obtain USDA licenses. Food vendors must also obtain a local permit and license to sell food to the public. Your city or county health department may issue a local permit if the food you intend to sell does not pose a health hazard.
Business license
A business license is a document issued by a government authority to allow a business to operate. It typically includes information such as the name of the business, where it is located, the type of business it is, the license period, any conditions or restrictions on its activities, and other details. A business license is often required before you start operating your business and is needed to keep your business open.
Get a Business License
Foodservice license
A food license is a permit issued by the local or state government that allows an individual or company to sell food to the public. The license may be required for a variety of reasons, such as ensuring that the public receives safe food, collecting taxes, or regulating the type of food that can be sold (e.g. selling only healthy foods to children). Food licenses are required by most countries, states, and municipalities, and there are a variety of different types of food licenses. Depending on the type of foodservice, a business will need to obtain a different license.
Get a Food Handlers License
Employer Identification Number (EIN)
Health Department Permit
Seller’s Permit
An Employer Identification Number, more commonly referred to as an EIN, is a federal tax ID number that registers your business with the IRS. It allows you to open a business bank account, create a credit profile, and even hire employees. An Employer Identification Number is free through the IRS and can be applied for through their website, or by mail.
Get Employer Identification Number
A health department permit or "food service license" is issued by the health department and indicates that your kitchen has passed the health inspection. An agent from the health department will examine your kitchen in search of violations and provide you with notes on what to correct and an overall grade. They check for proper food storage, overall cleanliness, and clear health and safety plans. Depending on the city, a health department permit can cost anywhere from $50 to $1,000. You can contact your local health department to request and schedule a visit.
Kitchen Health and Safety Inspection Requirements
A seller’s permit is required in some states to allow foodservice business owners to purchase ingredients and supplies at wholesale prices without needing to pay sales tax. Check your local state government’s website to learn if a seller’s permit is needed and how to apply for one.
How to find a Retail Space for your Meal Prep Business
Finding a suitable retail space for your business can seem challenging, but it does not have to be. You can find the perfect location for your business with the right approach. To start, you should create a list of requirements your future location needs to meet.
As you start your search, look for retail spaces close to a major highway. This will allow people to access your location.
quickly
In addition, you should focus on buildings close to a population center. Companies often choose to operate in these areas because they are close to many consumers.
You should also ensure that your future location has ample parking. People will not visit your business if they cannot easily park their cars. In addition, you should look for retail spaces that have high visibility. People will not visit your business if they cannot see it from the road.
Hiring Staff for your Meal Prep Business
When hiring staff, first determine the exact roles and responsibilities of each position. These may be changed depending on how many people you think you will need to run your business. Outline the qualifications and skills needed for each position and highlight them in your job board ad. This will help weed out underskilled applicants when in-person interviews, saving you time.
When looking for potential new hires, you should use a job search site. These sites allow you to search applications by entering keywords like relevant job titles, certification titles, or skill sets, narrowing down applications more efficiently. And allowing you to focus on more important things.
Create your Meal Prep Menu
This might be the most important thing to remember when creating your own healthy meal prep menu. You can't just throw together a bunch of foods and expect it to be a balanced and nutritious meal. There is a science to this, and if you want to be sure that what you're offering is healthy and will help your customers reach their health and wellness goals, you need to make sure that your meal prep menu is balanced.
This means that it has a good mix of nutrients, fats, and carbs that will keep you energized and satisfied throughout the day. It also has a good mix of different foods that will ensure that your customers are getting everything that they need.
How to Advertise Your Meal Prep Business
Advertising your business can be the most important part of growing and scaling your enterprise. Different forms of advertising can be used, but the most important thing to remember is that you need to keep your customers engaged.
Engaging with your customers through social media and other channels is vital for several reasons. First, it allows you to collect information about your customers, which is essential for improving your product or service and marketing. Second, it keeps customers engaged and interested in your products.
Another option is Word of mouth marketing. People trust their friends and family more than advertisements, and getting a good word of mouth delivers that. Word of mouth marketing is about creating an environment where your existing customers feel comfortable recommending your brand to their friends and family.
Find the right POS system
Choosing the right point of sale system for your business can be a critical decision with significant implications for your company's profitability and operational efficiency. Once you have narrowed down your options, it is important to evaluate each system carefully and select the one that best suits your organization's specific needs.
Toast POS is an easy-to-use point of sale system that allows merchants to accept credit card and debit card payments, process invoices, track inventory, and more. Toast POS is easy to install, with a simple plug-and-play setup. Merchants can use it to process card payments right away. It also comes with inventory tracking and invoicing capabilities. Toast POS works on multiple devices using Windows or MAC OS, including iPhones and Android devices, allowing merchants to access inventory and sales data from almost anywhere.
How To Start a Meal Prep Business Q&A
Whether you want to start a business as a side hustle or jumpstart a career in entrepreneurship, starting a meal prep business can be a great way to make money while helping people improve their health. When done right, this business idea can be both profitable and rewarding. Starting a meal prep business depends on the type of business you want to create. No matter your path, it is important to research the industry and determine whether this business idea is right for your goals and skill set.
How much should I charge for meal prepping?
The cost of a meal plan will depend on your location, experience level, and the type of meal plan you are offering. Usually around $10-12 dollars per serving, but it will depend on the type of foods you a prepping and the overall cost to you to buy products in bulk.
Can I cook food in my house and sell it?
Unfortunately, like operating a restaurant, you cannot cook and sell food from your home without first obtaining the proper permits. In most cases, you will need to get a business license and a permit from your health department if you plan to sell food from your home. In addition, you will need to make sure that you have the correct equipment in your kitchen to prevent any risk of contamination.
How do meal kits make money?
Running a meal prep company can be expensive. There are operational and supply-chain costs, marketing, and logistical costs. A meal-kit company can only make a profit by charging substantially more than what it would cost a home cook to gather the right ingredients. Seasonal changes too affect the meal prep business, requiring forward planning and investment. The start of the year tends to boost demand as people try to fulfill resolutions to eat more healthily and in the summer months, costs rise as extra packaging is needed to keep ingredients safe.
How much does it cost to ship food?
The cost of shipping food can vary greatly depending on the distance traveled, the type of food being shipped, and whether the food is perishable or non-perishable. The cost of shipping non-perishable foods, like canned goods, is less than the cost of shipping perishable foods like fresh fruits and vegetables.
The cost of shipping perishable foods depends on the season and location. For example, the cost of shipping fresh fruits and vegetables from Florida to New York in the fall will be higher than shipping the same product in the spring.
The cost of shipping food also depends on the method of transport being used. Trucking perishable foods can be more expensive than shipping non-perishable foods using the same method.
How do you ship fresh food?
The best way to ship fresh food is by using insulated packaging that has a cold pack to keep the food cool. Also, make sure that the food is well-sealed so that it doesn’t get contaminated by the outside environment or other items in the truck. You need to maintain a temperature between 35 and 36 degrees, and it also needs to be monitored all the way from the farm to the store, to make sure it stays at that temperature. Another main thing is making sure the product isn’t contaminated.
