Chapter11:

STARTING CATERING BUSINESS

11.1 Types of Catering Service
• On-Premise Catering
• Off-Premise Catering
• Accommodation
11.2 Legal Considerations
• Zoning
• Licensing
• Insurance
11.3 Procedure in Securing Permit to Operate
11.4 Procedure in Obtaining a Mayor’s Permit
11.1 Types of Catering Service

On- Premise Catering - is catering for any function—

banquet, reception, or event—that is held on the
physical premises of the establishment or facility that
is producing the function. On-premise caterers—such
as hotels, convention centers, and restaurants—
usually have the advantage of offering many services
under one roof. They can also provide sufficient space
to house an entire event and plenty of parking. In
general, each catered event has one host and one bill.
ON-PREMISE
CATERING
 Off-Premise Catering - often involves producing food at a
central kitchen, with delivery to and service provided at the
client’s location. Part or all of the production of food may be
executed or finished at the event location. At times, off-
premise caterers must rely on generators for electricity, truck in
potable water, devise a trash system, and otherwise “rough it.”

-Many localities have independent banquet halls, civic

auditoriums, stadiums, arenas, ethnic social clubs, fraternal
organizations, women’s clubs, private city or country clubs,
athletic clubs, hospitals, universities, libraries, executive dining
rooms in office buildings or corporate headquarters, churches,
recreation rooms in large apartment or condominium
complexes, parks, museums, aquariums, and restaurants with
banquet rooms. Some of these facilities are often more
competitive than hotels, as they have more flexible price
structures because of their lower overhead expenses. Some are
public facilities and are tax-exempt. A number of these facilities
provide their own catering in-house, others are leased to and
operated by contract foodservice companies that have
exclusive contracts. Still others will rent their facilities to off-
premise caterers
OFF-PREMISE
Accommodation Service - Accommodation is the
common word for any kind of lodging or dwelling
where people stay and sleep. Finding suitable
accommodation can sometimes be tricky as demand
can often eclipse supply. And often it can be hard just
to find a place that is suitable for you, somewhere you
are going to want to spend your time. As populations
grow everywhere and urban environments get more
complex and harder to navigate, accommodation
services have started popping up everywhere. These
services fill an important need for people, and are
dedicated to making it easier for you when you are
trying to find an appropriate place to lay your head.
 Both on-premise and off-premise catering have much in
common. Obviously, transportation by vehicle is a main
difference. It complicates food safety issues such as
packing safely to keep hot foods hot and cold foods cold,
and to avoid spillage. This is accomplished by using:

-insulated coolers,
-refrigerated vehicles, and
-portable warming units.

 A caterer’s reputation for high-quality food that is safely

prepared can take years to develop. Any outbreak of a
food borne illness could result in lawsuits, death, and the
closing of the business. Safe food handling procedures are
a must; there are no shortcuts.
 Accommodation services exist for long term placement or if you are
just looking for a holiday apartment for a few days. When you are
looking for short term holiday accommodation it can often be
incredibly hard to find somewhere suitable. It makes a lot of sense to
enlist the help of a holiday accommodation service provider. They are
specialized in this field and will have the necessary contacts needed to
find all of the available and suitable places that you need. This is even
more the case when you are looking for accommodation abroad. A
service provider can give you a direct link with people that offer
accommodation and will act as a medium when language and
customs may get in the way.

 There are some really cool places that you can stay in the world, from
traditional huts in Africa to fantastic modern Berlin apartments, the
list is almost endless. The hard part is in finding that exotic
accommodation or sourcing the best price for that ecologically
designed apartment. This is where a professional service can come in
handy and take all of the stress and endless hours of frustration out of
the process. There are many accommodation services that have a
presence on the Internet, that way it is even easier for you to go and
check out what they have to offer. Many have pictures and floor plans
of the housing that they are offering so that there are no nasty
surprises for you when you get to your destination.
11.2 Legal Considerations
There are some legal aspects you must consider
before getting started like applying for a state food
dispenser's license and approval of the site where you
are going to cook approved by the local board of
health. Selling food cooked in a place that isn't up to
the law is a serious offence and can land you behind
bars.
Your manufacturing practices and quality of
ingredients used must also meet the standards
specified by the law. You must also get the food you
prepare tested to make sure it doesn't cause any
illness.
ZONING

 When you start a catering business, you'll need to

check state and local laws. Zoning laws could affect where you
do your cooking and how much of your catering business you
can actually handle from home. The city you live in may require
a permit. It won't be fun or easy getting everything set up
legally, but when it's the law, you don't have a choice. Starting
a catering business illegally is a bad idea.

 Dividing an area into zones and sections reserved

for different purposes such as residence and business and
manufacturing etc.

 Decide on a name and then create your identity.

 The entire process of naming your catering business

and creating an identity is known as "branding."
LICENSING

 The granting of permission to use intellectual property rights, such

as trademarks , patents, or technology, under defined conditions.

 The facility (kitchen) where food is prepared should be licensed as

a Food Service Establishment .Contact the Department of
Agriculture and Rural Development, Food Division, Food Service
Section; (517) 373-1060, for inspections. Generally, a person's
home kitchen, where food is also prepared for family members,
will not meet the regulations to be licensed.  

 When starting a catering business, consider renting space in a

kitchen that is already licensed, (i.e. church halls, rental halls) until
the cash flow warrants the expenditure for a more permanent
facility. If the facility is licensed, but the licensee does not wish to
accept the liability, a separate fixed or temporary license
application must be submitted for the same facility by listing the
caterer or catering cook as the responsible party.  
INSURANCE

 As a catering business owner, you will want to do

everything you can to minimize risk to yourself and
your employees. But there are many types of risk.

 Insurance helps keep risk to you, your partners,

your investors, bankers and other creditors
minimized as well. Insurance is designed to protect
tangible assets, thereby protecting your
investment.

 Some may consider insurance a necessary evil. In

actuality, it’s your financial safety net and a
requirement by law.
What are some of the ways insurance protects your
catering company?
 If you borrow money from a lending institution, those loans are
often insured from default in case the worst happens and you’re
unable to repay them. That won’t let you off the financial hook
necessarily, but it will help the lender, especially if the loan is an
SBA loan.

 Liability insurance covers your catering business should a non-

employee, such as a customer or vendor, become injured in an
accident while on your premises or while you’re at a catering event.
Injuries can range from falls to burns, even employee neglect that
results in injury to a customer. Even food-related illnesses are
covered by liability insurance coverage.

 Every catering business has to be located somewhere, whether at

home or location-based. If you’re a home-based catering company,
you should already have homeowner’s insurance. However, since
you’re running a business from your home, you should discuss with
your insurance agent the possibility for greater coverage since your
liabilities have changed with the changing use of your home.
For location-based catering businesses, structural insurance
(fire damage, water damage, natural disasters, etc.) depends
upon whether you’re leasing our location or purchasing. If
you’re leasing, the building owner usually carries the
insurance and passes the cost onto you in the lease amount.
If you’re purchasing your catering location, your lender will
require coverage.

Every catering business must have transportation. State and

federal laws mandate that you carry a minimum amount of
insurance for your vehicles. If purchasing new vehicles, your
lender will require enough coverage to offset their financial
liability (and yours).

Worker’s Compensation is also a possible need. Not every

company carries worker’s comp. Some companies prefer to
pay for employee injuries out of their own pockets and take
their chances due to the high cost of coverage.
11.3 Procedure in Securing
Permit to Operate
 The usual procedure in securing a business permit is as follows:

1. Secure a barangay clearance- requirements usually are: duly filled out

form, AOI or DTI Registration; lease contract, pictures of the
establishment. Other requirements are imposed (in Pasig Bgy. San
Antonio, they require insurance)
2. After getting the barangay clearance, you proceed to the city hall
(BPLO Business Permit and Licensing Office) where they will give you
a form to fill up. You must submit the duly filled up and notarized
form
3. Go to the Engineering Department to get the assessment for building
fee (they will ask for the building and occupancy permit). Then
proceed to Electrical Department for assessment (they will require
mechanical and electrical permit )
4. Go to BPLO so they can check the requirements, have the
assessment and fees encoded and also to check any violations or
penalties. The EDP will issue the Order of Payment.
5. Procure cedula.
6. Go to Treasury department then pay the fees.
7. You then proceed to the Health and Sanitary Office where you will
secure the Health and Sanitary Permit (In Pasig, they require a drug
test and X-ray for all the employees). They will also require
attendance in a seminar
8. You go to CENRO (City Environment and Natural Resources Office)
to secure an Environmental Permit (usual requirement is Affidavit
of Undertaking).
9. Then off to the BFP (Bureau of Fire Protection) for the Fire Permit
Fee. Take note that all business establishments are required to
have a fire extinguisher. The number of fire extinguishers will
depend on the floor area of the establishment. An inspection by the
BFP will be conducted before the issuance of the clearance. They
will issue a Fire Safety Inspection Certificate.
10. Some LGUs do not conduct inspection anymore but rather require
pictures of the establishment.
11. After all these permits are secured, then the business license is
issued. However, in some cities, they issue the business permit
temporarily subject to the issuance of the other permits (Sanitary
permit, Fire Certificate).
11.4 Procedure in Obtaining a
Mayor’s Permit
1. Business permits expire on the 31st of December unless the permits
are issued on a quarterly basis.
2. Must be renewed before the end of January.
3. Different requirements per city.
4. For new applications, the requirements usually are: barangay
clearance, zoning clearance, environmental permit to operate, fire
clearance, etc.
5. To secure these licenses, the requirements usually are
6. articles of incorporation for corporation, articles of partnership for
partnership and DTI registration for sole proprietorships
7. accomplished form
8. Lease contract or proof of ownership
9. Sketch of the Location
10. Fire Safety Clearance
 Please note that some businesses require special permits before they
can be granted a business permit. Examples of such are:

1. Security agency - PNP permit

2. Rice retailer (a only), bakery (a & b) and drug store (b only).
a. NFA permit
b. Bureau of Food and Drug Administration (BFAD) Permit
3. Certification of exemption if exempted under any law or decree.
4. Theater/movie houses - Certified certification of registration from the
movie and television review and classification board (MTRCB).
5. Sales and rentals of video tapes - Registration from Videogram
Regulatory Board (VRB).
6. Gasoline station - Energy regulatory board (ERB) registration.
7. Factories / private market / commercial building / importer and
exporter warehouse / garments sub-contractor - Certificate of
Occupancy .
8. Factories pertaining to air / water pollution - Department of
Environment and Natural Resources (DENR) clearance.
9. Buy and sell - police clearance.
10. Real estate lessor - Sworn statement of the assessed value of real
property as indicated in the real property tax declaration and
current real property tax payment official receipt.
11. Local employment - Certification from Philippine Overseas
Employment Agency (POEA).
12. Talent promotion - Philippine Overseas Employment Agency
(POEA) permit.
13. Training center - Certification letter from accredited agency.
14. Crewing / manning / shipping / agency - Philippine Overseas
Employment Agency (POEA) permit.
15. Travel agency - Permit from the Department of tourism.
16. Pawnshop/bank / lending investors - Indorsement from central
bank.
17. Water dealers/ water delivery/ water drilling - Permit from National
Water Resources Board (NWRB).
18. School - Department of Education, Culture and Sports (DECS)
permit.
19. Firecrackers and pyrotechnic devices - dilg / pnp permit.
20. Taxi / bus / jeepney operation - LTO franchise indicating number of
units.
21. Receiving home, orphanage - Department of Social Welfare and
Development (DSWD) registration.
22. Dental prosthetic laboratory - License to operate from the
Department of Health (DOH).
These requirements sometimes vary depending on the city
government.
~THE END~