Do you need a food licence or a permit to own a cloud kitchen business

Do you need a food licence or a permit to own a cloud kitchen business

The country-wide lockdown saw a sharp rise in new online food business. People were making use of their time indoors to start new ventures in food, be it to fuel their passion or simply to earn a living. While the hospitality sector took a huge hit, many turned to starting their own businesses in catering and food delivery via the use of social media. This venture is indeed a lucrative one at this time and if promoted and marketed correctly could become a huge success. Technology has made it quite easy to set up your online food business, but there are certain rules and regulations set by the governing bodies, which need to be followed in order to continue with your food start-up.

The legal requirements to set up your Cloud Kitchen are similar to those required for a catering business in India. The first step is to set up your business identity – the structure of your business, whether you’re a sole proprietorship business, a partnership, an LLP or private undertaking. Identifying the type of business you want to be, helps you set an account with the preferred bank of your choice (a business account or a current account in this case), and also ensures that you have an authentic certification to operate in the country.

The second step in your journey is registering your business for GST (Goods & Services Tax). However, this would only be required once your business reaches a turnover in excess of 20 lakhs. You would also require a health trade licence, issued by the municipal authority in your state of operation. This licence is necessary when you have employed 15 people or above for your business. Until then, you can continue your Cloud Kitchen business without it.

It is mandatory for new food businesses to follow a set of basic safety and hygiene guidelines that are set by the authorities. Here is a list of requirements that is important for any food business to follow, online or otherwise –

  • The premises/kitchen must be clean and have a hygienic environment.
  • The area should get ample lighting, must have good ventilation and must be disinfected to keep it free from insects.
  • There should be continuous availability of potable water in the vicinity
  • The equipment being used should be easy to clean and must be made of non-toxic metals.

It is imperative that the ones handling the food inside the area must follow strict personal hygiene guidelines.

When the question of food licenses and permits arise, it is not mandatory for every online food start-up to have a license or a permit. According to the Food Safety and Standards Act (FSS) of 2006, small-scale food businesses that incur an annual turnover below INR 12 lakh need to be registered only with the Food Safety and Standards Authority of India (FSSAI). So, if your annual turnover is below INR 12 lakh, then you need not apply for a license or a permit. This registration can be done with the state authorities to do business within the state.

Getting your business registered might sound like a tedious task, one that would require going from one desk to another to get your form verified and approved. Fortunately, it’s much easier than you think.

Step 1 – Visit https://fssai.gov.in/ to start the registration process

Step 2 – Fill in the form with all relevant details

Step 3 – Send soft copies of your documents to FSSAI via e-mail, after which your registration submission will be complete in 2 days.

Step 4 – Once your documents are verified, it would take another 10 days for your registration to be completed

Step 5 – A nominal fee of INR 100 is required as your registration fee

While it seems that setting up a new food business is quite a long process, the regulations are set to safeguard the interests of the customers. Now that you know what you need to do for starting your own online food business, all you need to do is register yourself and join Gustasi to promote your business further.


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