Are you wondering how to sell food online, but not sure where to start? You’re not alone. The global online food delivery market was valued at $380.43 billion in 2024 and is expected to reach $618.36 billion by 2030, growing at a 9% CAGR. With demand continuing to rise, now is a great time to tap into this booming market.
In this guide, I’ll cover the legal and practical steps to start an online food business. You’ll learn everything from food laws and required permits to setting up your website and marketing your products effectively.
Key Takeaways
- Why Sell Food Online: Americans now order delivery or takeout 4.5 times per month, more than they dine out (3 times per month). This shift in behavior makes selling food online a high-demand opportunity. To stand out, identify a niche and define what makes your offer unique.
- Understand Food Regulations First: Before selling food online, ensure compliance with local, state, and federal laws. Secure the right licenses, choose a legal structure, and meet health certification requirements.
- Pick the Right Production Model and Build Strong Supplier Relationships: Start with a setup that matches your scale. Then, partner with reliable suppliers to ensure consistent quality, manage inventory effectively, and reduce food waste.
- Create a Memorable Food Brand: Develop a strong brand name, logo, and packaging that reflect your niche and values. Using specific brand colors strategically can boost brand recognition by as much as 80%. A clear, consistent identity builds trust and sets you apart from competitors.
- Build a User‑Friendly Website with Online Ordering to Increase Sales: Create a mobile‑optimized, easy‑to‑navigate website with secure online ordering, multiple payment options, and high-quality food photos. 63% of customers prefer ordering directly from a restaurant’s website, and restaurants that offer online ordering typically see a 30% increase in takeout revenue.
- Promote Your Food Online Business: Use paid ads, local SEO, social media, and positive reviews to attract more customers and increase your online presence.
Below, I’ll break down the key steps for selling food online. From legal requirements to launching your website, you’ll find everything you need to get started.
Step 1: Research Food Law and Get a Legal License
Food laws are a set of regulations and guidelines that govern the production, distribution, and sale of food products.
It is designed to protect consumers from harmful food products and ensure that food products are safe, wholesome, and accurately labeled.
What Are the Types of Food Laws?
There are various types of food laws, such as federal and state laws, each with its own specific focus and responsibilities.
- At the federal level, the U.S. Food and Drug Administration (FDA) regulates the sale of food products. This includes ensuring that food products are labeled correctly and are free from contaminants. Additionally, the FDA has regulations in place for food products sold across state lines.
- At the state level, laws and regulations vary. However, most states require that food businesses be licensed and inspected. This may include obtaining a food handler’s permit, a food establishment permit, and/or a food processor’s license. Additionally, states may have specific requirements for the sale of certain types of food products, such as cottage food laws, which allow the sale of certain non-potentially hazardous homemade foods.
What Is a Food License?
A food license is a permit issued by a government agency that allows a business to operate in the food industry, such as the state health department.
It is a legal requirement for businesses that prepare, package, serve, or sell food products to the public.
The license is usually granted after an inspection and review of the business’s food safety practices to ensure that they meet the agency’s standards and regulations.
The license is required for an online business as well as a physical food store or restaurant.
Do You Need a License to Sell Food Online?
To legally sell food online, you must research and comply with federal and state laws. This may include obtaining the necessary licenses and permits, as well as ensuring that your food products meet labeling and safety requirements.
To start your food brand, you may need to register your business and obtain any required insurance.
You can apply for a business license on the SBA (U.S. Small Business Administration) website.
How to Register Your Business and Choose a Legal Structure
To operate a successful online food business legally, you must first register your food business with the appropriate state authority. This process includes selecting your business name and deciding on a legal structure that fits your goals, liability concerns, and tax preferences.
Your legal structure determines taxes, liability, and how you manage your business. Here are the most common options:
- Sole Proprietorship: Simple and inexpensive to set up, but you’re personally liable for debts and legal issues.
- Limited Liability Company (LLC): Offers liability protection and flexibility. Ideal for most small food businesses.
- Corporation: Suitable for larger businesses or those seeking investors, but more complex and costly to maintain.
Consider factors like your growth plans, risk tolerance, and tax implications before making a decision.
If you’re unsure which business structure to choose, consider consulting with a business attorney or using free resources on the U.S. Small Business Administration website to compare the pros and cons.
Once your structure is chosen, register with your Secretary of State and apply for an EIN (Employer Identification Number) through the IRS website. You’ll need this to open a business bank account and handle payroll or tax filings.
Required Permits and Health Certifications
To sell food online legally, you must obtain the necessary permits and certifications to ensure food safety and compliance with local regulations. Requirements vary by state, so check with your local health department before starting.
Common permits and certifications include:
- Food Handler’s Permit: Ensures that anyone preparing or handling food has completed safety training.
- Food Establishment License: Required for businesses selling food to the public.
- Health Department Inspection: Mandatory for commercial kitchens or shared kitchen facilities.
- Home Kitchen Permit (for cottage food): If you’re preparing low-risk foods at home, your state may offer a cottage food license.
- Zoning and Fire Permits: Especially important if operating out of a physical location or commercial kitchen.
Before you start selling food online, make sure you comply with the laws and regulations in your country, state, or region. Requirements can vary widely depending on your location and may change over time, so it’s critical to stay informed.
I recommend consulting your local health department or a legal expert to ensure you meet all necessary food safety and licensing standards. These rules apply to all food businesses, whether you plan to sell from home, through your own website, or in a traditional brick-and-mortar restaurant.
Step 2: Identify Your Niche and Choose a Business Model
Finding your niche and restaurant business model is a key step in online food selling.
A niche is a specific market or target audience that you will cater to, and a business model is the way in which you will generate revenue from your food products.
What Is a Food Niche and Why Does It Matter?
A food niche refers to a specific segment of the food industry that caters to a specific group of consumers with specific dietary needs or preferences.
This can include organic and non-GMO products, gluten-free options, and plant-based alternatives.
Food niches provide options for individuals who may have dietary restrictions or prefer certain types of food.
For example, individuals with celiac disease or gluten intolerance can find products that cater to their needs in the gluten-free niche.
Similarly, those who follow a vegan or plant-based diet can find options in the plant-based niche.
Popular Food Niches (19 Examples)
Food niches refer to specialized or unique segments of the food industry. Here is a list of some examples:
Kitchen-based food niches:
- Ethnic cuisine (e.g., Italian, Chinese, Mexican)
- Regional cuisine (e.g., Southern, New England)
- Specialty cuisine (e.g., vegan, gluten-free)
- Gourmet cuisine
Diet-based food niches:
- Vegetarian and vegan
- Gluten-free
- Paleo
- Keto
- Whole30
Service-based food niches:
- Catering
- Meal delivery
- Food truck
- Pop-up restaurant
- Fine dining
Group-based food niches:
- Family-friendly
- Couples
- Business
- Senior citizens
- Children
How to Choose Your Own Niche
Choosing your own food niche can be a great way to tap into a specific market and provide unique products or services to consumers.
I prepared a quick visual guide to help you choose your food niche.
Here are some steps to help you choose your own food niche:
- Start with food ideas. Think about your tastes and interests, and consider what kind of food products or services you could offer that would be unique or different from what’s already available.
- Check food trends. Explore current food trends and see if any of them align with your ideas. For example, are there any popular diets or food movements that you could tap into?
- Do market research. Research your restaurant’s target market and analyze competitors to identify gaps in demand. Look at what similar businesses are doing well (or not so well) and find your differentiator.
- Validate your idea. Use surveys, focus groups, social media, or tools like Google Trends and online marketplaces to test interest in your concept.
Step 3: Choose Your Production Model
When starting a business in the food industry, one important step is to determine the production model that will be used to create and distribute your products.
There are several options to choose from, including
- self-production (selling homemade food),
- manufacturing,
- reselling.
Each model has its own advantages and disadvantages, and it’s important to consider which one is the best fit for your business.
To help you make an informed decision, I’ve prepared a comparison table outlining the key features, pros, and cons of each production model.
Production Model | Best For | Pros | Cons |
---|---|---|---|
Self-Production | Home cooks, small-scale startups | Low initial investment, full control over recipes and quality | Time-consuming, limited capacity, local regulations may apply |
Manufacturing | Growing brands, businesses ready to scale | Efficient, scalable, hands-off production | Higher costs, less control, dependent on third-party timelines |
Reselling | Marketing-focused entrepreneurs | Quick setup, no need for kitchen space | Less product uniqueness, lower profit margins, reliance on suppliers |
1. Self-Production: Selling Homemade Food Online
As the name itself suggests, self-production involves creating and producing the food products yourself, using your own kitchen and equipment.
This can be a good option for small food businesses or entrepreneurs who are just starting, as it allows for flexibility and control over the production process.
However, it can also be time-consuming and costly, and may limit the scale of your business.
If you plan to sell homemade food online directly from your home kitchen, cottage food laws may apply. These laws vary by state and outline which foods can legally be sold without a commercial kitchen license. Common examples include baked goods, jams, and dry mixes, but restrictions and labeling requirements differ significantly by region.
You can find a complete list of state-specific laws and guidance on the Association of Food and Drug Officials (AFDO) website.
2. Manufacturing
This model involves outsourcing the production of your food products to a third-party manufacturer.
This can be a good option for businesses that want to expand their product line or increase production, as it allows for greater efficiency and scalability.
However, it also means giving up some control over the production process and may require a larger investment upfront.
The great thing is that you don’t have to worry about food packaging ideas or the food service supply chain overall. This model will take care of the process from preparing to shipping food and other goods.
3. Reselling
This model involves buying and reselling food products that are already produced by other companies.
This can be a good option for businesses that want to focus on sales and marketing, as it allows for lower production costs and less investment in equipment and facilities.
However, it also means less control over the quality and consistency of the products and may limit the uniqueness of your offering.
Step 4: Find Ingredients Suppliers
Once you’ve determined the production model for your food business, the next step is to find ingredient suppliers that can provide the raw materials you need to create your products.
There are several options to choose from, including grocery stores, local suppliers, and warehouses. I will briefly explain each option along with its pros and cons.
“Let’s face it: if you and I have the same capabilities, the same energy, the same staff, if the only thing that’s different between you and me is the products we can get, and I can get a better product than you, I’m going to be a better chef.”– Thomas Keller, Chef.
Grocery Store
Buying ingredients from a grocery store can be a convenient option for small businesses or home-based entrepreneurs, as it allows for easy access to a wide variety of products.
However, it can also be more expensive than other options and may not offer the same level of quality or consistency as a specialized supplier.
Local Supplier
Buying ingredients from a local supplier can be a great option for businesses that want to support the local economy and ensure that their ingredients are fresh and high-quality.
Local suppliers may also be more flexible and willing to work with small businesses. However, they might have a more limited selection and higher prices.
Building trust with your restaurant food suppliers can lead to better pricing, early access to high-quality ingredients, and valuable insights. Many suppliers are open to working with small food businesses and may even suggest seasonal or trending ingredients that fit your concept. Treat these restaurant partnerships as long-term investments in the success of your food business.
When choosing an ingredient supplier, carefully weigh the pros and cons of each option.
To run a successful online food business and reduce food waste, use an efficient inventory management system. Tracking stock levels, monitoring expiration dates, and forecasting needs help prevent over-ordering and control costs. Innovative tools make managing your supply chain easier and minimize spoilage.
Step 5: Choose the Right Location for Operations
Once you have established the production model and sourced your ingredients, the next step in starting a food business is to secure a suitable location to sell your products.
Many successful food businesses start small, often from home, and gradually expand their operations as demand grows. The key is to begin with a setup that fits your current scale and budget, and adapt as you grow.
There are several options to choose from, including selling food online from home and setting up your own facility.
I’ve created a comparison table to help you decide which food business setup is proper for you.
Location Type | Pros | Cons | Cost | Licensing |
---|---|---|---|---|
Selling Food Online from Home | Low startup costs, flexible, ideal for testing your idea | May be limited by local laws, space, and equipment | Low | Varies by state; may require registration under cottage food laws and kitchen upgrades |
Renting a Commercial Space | Increases visibility, customer access, and professional image | Higher rent, long-term lease, more overhead | Medium–High | Must comply with zoning laws, health codes, and business licensing requirements |
Using a Shared Kitchen | Access to commercial-grade equipment, lower costs, built-in licenses | Shared space, limited availability, scheduling conflicts | Medium | Usually already licensed and inspected; easier to start quickly |
Opening Your Own Facility | Full control, scalable, meets custom production needs | High upfront investment, full regulatory responsibility | High | Requires full health inspections, zoning approval, business registration, and insurance |
Sources: UpMenu, Shopify, CloudKitchens, Forage Kitchen
1. Selling Food Online from Home
This option allows you to operate your business from your own home. It can be a cost-effective and flexible option, as it eliminates the need for a physical storefront.
However, it may limit your ability to reach a large customer base and may not be allowed in all areas.
Yes, but you’ll need to check your local cottage food laws, which vary by state. Many states allow the sale of non-perishable homemade items, such as baked goods and jams, while others are more restrictive. You may also need permits and proper labeling.
For state-specific rules, visit the U.S. Food and Drug Administration (FDA) website and consult your local health department to ensure compliance.
2. Renting a Commercial Space
This option involves renting a space in a commercial area, such as a shopping center or downtown street. This can be a great way to attract customers and increase visibility for your business.
However, it can also be more expensive than other options and may require a long-term commitment.
3. Using a Shared Kitchen
A shared commercial kitchen is a facility that is available for rent by multiple food businesses, typically on an hourly or daily basis.
Using a shared commercial kitchen allows you to use professional equipment and facilities that are already in place, which can save money and time on setting up a kitchen.
It also gives you access to commercial-grade equipment, such as large ovens, industrial mixers, and walk-in coolers, that may be too expensive to purchase for a small business.
Additionally, working in a shared commercial kitchen can also provide an opportunity for networking with other food entrepreneurs; you may be able to share resources, ideas, and strategies.
4. Opening Your Own Facility
This option involves building or buying a facility specifically for your business.
It offers complete control over your operations and ensures compliance with all necessary regulations. However, it can be very costly and requires a significant investment.
You’ll need to make sure your facility meets local zoning, health, and safety codes. Depending on your product and location, you may also need USDA or FDA inspections to sell and ship food across state lines.
Considering the high costs of this option, most small food businesses start from home or use a shared commercial kitchen before investing in their own facility.
Step 6: Create Your Food Brand
As soon as you establish the production model, source ingredients, and set up a location, the next step to start an online food business is creating a brand that will help you stand out in the market and attract customers.
This process involves several key elements, including setting a brand name, creating a logo, choosing colors, and designing packaging.
A strong brand builds recognition and trust. It should reflect your values and food concept while remaining consistent across your website, packaging, and marketing materials. Consistent restaurant branding is essential for the success of your food business.
A restaurant branding agency can help you create an identity that truly connects with your audience.
1. Set Your Brand’s Name
The name of your brand is one of the most important aspects of your business. It should be memorable, easy to spell, and easy to pronounce. It should also be unique and not already taken by someone else.
It’s essential to conduct thorough research to see if the name is available as a domain name, social media handles, and trademarks.
Here is a restaurant name generator you can use to brainstorm creative and unique names for your food business.
2. Create a Logo
Your logo is the visual representation of your brand. It should be simple, memorable, and easily recognizable, as well as versatile enough to work across different media and formats.
A good logo should communicate the essence of your brand simply and effectively. It should also be designed to be adaptable for use in different sizes and contexts.
You can design your food business logo using tools like Canva to save money for essentials like equipment and ingredients. Or, work with the best restaurant branding agency for a professional, unique logo that reflects your brand.
3. Choose Brand Colors
The colors you choose for your brand can have a significant impact on how your customers perceive your business.
They should be consistent with the overall design and evoke the emotions and feelings that you want your customers to associate with your brand.
4. Design Packaging
Packaging is the first thing that customers will see when they encounter your product. It should be eye-catching, informative, and consistent with your brand.
The packaging should convey information about your product, such as ingredients, nutritional value, and contact information, in a clear and concise manner.
Using safe, approved materials is essential, but it’s also a good idea to focus on sustainability in food service by opting for eco-friendly packaging that reduces environmental harm.
Remember that the FDA regulates materials that come into contact with food, like packaging, containers, and cookware, to ensure they’re safe for use. Here you can learn more about the FDA Food Ingredients & Packaging.
Step 7. Create Your Offer
The next step in starting a food business is to create an offer that will attract customers and generate revenue.
This process involves several key elements, including creating an offer, pricing your offer, and using food photography.
1. Create an Offer
Your offer is the product or service you sell, and it should be unique, high-quality, and tailored to your target market.
Create a unique selling proposition that highlights its benefits and sets it apart from competitors.
Take into account the following tips while creating an offer:
- Test and improve: Try different versions and adjust based on feedback.
- Keep it simple: Avoid jargon and make it easy to understand.
- Stay compliant: Ensure your offer meets local food regulations.
2. Price Your Offer
Pricing your offer is an essential step in determining the profitability of your business. It should be based on your costs, competition, and target market.
Conduct market research to see what similar products are being sold for and to make sure your price is competitive.
Estimate Your Startup Costs
When pricing your offer, you need to consider the startup costs of launching your online food business. These costs depend on your business model.
If you’re running a home-based food business, you might only need a few hundred dollars for ingredients, packaging, a website, and basic marketing.
If you’re planning to open a physical location later, be prepared for higher expenses. Opening a restaurant typically costs between $275,000 for a rented space and $425,000 if you buy the building.
To save money, you can explore shared commercial kitchens or food incubators, which offer access to licensed facilities at a lower cost than setting up your own.
3. Use High-Quality Food Photography
Great visuals sell food. Invest in professional photos or follow food photography tips to capture images that are appealing, consistent with your brand, and showcase quality. Use these photos across your website, social media, and marketing materials to attract customers.
Creating a compelling offer and setting a competitive price are key to success when selling food online. Thoughtful planning will help your offer resonate with your target market and stand out from the competition.
Step 8: Build a Website with Online Ordering
The next step in selling food online is creating a website with an online ordering feature to reach customers and drive sales. It may sound complex, but it’s easier than you think.
Here you can find a full step-by-step guide on how to create a restaurant website.
Below, I’ve outlined the key steps to help you get started, including whether to build the website yourself or hire a professional, choosing a template, designing your site, and creating engaging content.
Build the Website Yourself or Hire a Professional
Building a website can feel daunting, and the first decision is whether to do it yourself or hire a professional.
Doing it yourself can save money, but it often requires more time and effort. Hiring a professional costs more but saves time and ensures a high-quality result. That’s why UpMenu offers tailored, affordable restaurant website development services.
You can also use a dedicated restaurant website builder that simplifies the process with ready-made templates, integrated online ordering, and easy customization, no coding skills required.
I have prepared a table comparing costs based on the model you select to help you make a decision.
Building a website yourself | UpMenu restaurant website builder | Hiring an agency | |
---|---|---|---|
Domain | $0-$20 | $0-$20 | $0-$20 |
Hosting | $0-$250 | $0 | $0-$250 |
Development/Design | $0 | $0 | $1,000-$5,000 |
Maintenance | $100-$500 | $49-$169 | $100-$300 |
Total costs | $100-$770 | $49-189 | $1,100-$5570 |
Sources: WebsiteBuilderExpert, Wix, GloriaFood
With UpMenu, you have everything you need to start selling food online. No matter whether you are a small food business that is just getting started or a big company with thousands of clients.
Our data shows that restaurants using UpMenu-powered websites see, on average, a 31% higher conversion rate compared to those who only embed an online menu on an external site.
UpMenu system is tailored to the needs of businesses that sell online food products, facilitating sales, management, and marketing.
You can register for a free trial and try UpMenu here.
1. Choose a Template
Choosing a template for your website is an important step in determining the overall design and layout.
There are many pre-designed food website templates available in our library that you can use as a starting point and customize to fit your needs.
2. Start Designing
Once you have selected a template, you can start designing your website.
This includes adding your logo, colors, and other visual elements that are consistent with your brand.
You should also think about the overall layout and user experience, ensuring it is easy to navigate and use.
3. Create Content for Your Website
Creating content for your website is an essential step in attracting and engaging customers.
This includes writing product descriptions, creating blog posts, and adding customer reviews.
It’s important to create high-quality, informative, and engaging content that will help convert visitors into customers.
Step 9: Create an Online Store
Once you’ve built your website, the next step to start selling food is to create an online store and set it up to sell your products.
In the instructions below, I’ll show you how quick and easy it is with the UpMenu online ordering system.
Also, check out this step-by-step guide on how to set up an online ordering system.
1. Set Up Offer
To sell your products and reach customers, you have to add your products to make them available for purchase.
This includes adding product images, menu descriptions, and pricing information.
It’s essential to make sure that your offer is clearly presented and easy to find in your online store.
2. Provide Business Details
Providing business details in your online store is a necessary step in building trust with your customers.
Add your business name, address, phone number, and email address. It’s also important to include information about your business hours and any other relevant details.
3. Set Up Payment Methods
To enable customers to make purchases, you need to set up secure payment methods in your online store.
UpMenu supports the following online payment providers: Stripe (including Apple Pay and Google Pay), PayPal, and Adyen.
Having a functional online store is essential for the success of your own food business.
By carefully considering each of these elements, you can create an online store that is easy to use and that helps you reach customers and generate sales.
Step 10: Set Up Shipping
Shipping and delivery are crucial for any food business. A well-planned strategy ensures timely orders for customers and efficient handling of your delivery needs.
Create and Manage Delivery Zones
To ensure that your customers receive their orders in a timely manner, it’s necessary to set up clear delivery zones for your business.
This includes determining the areas you can realistically deliver to and the delivery fee associated with each delivery zone.
Pickup or Delivery: What to Offer
As a food business, you have to decide whether to offer pickup or delivery service, or both.
Pickup service can be more economical, but delivery service can provide more convenience for customers.
In-House Delivery vs. Third-Party Courier Service
Decide whether to manage delivery in-house or outsource it to a courier service.
Handling delivery yourself gives you more control over the process and helps build stronger customer relationships, but it can be time-consuming and costly. You’ll need your own drivers and restaurant delivery software to manage orders and routes efficiently.
Third-party delivery services can simplify logistics, but are often more expensive and less personal. With this model, you provide direct online ordering through your website or app, while partners like Wolt Drive, Stuart, Uber Direct, or DoorDash Drive handle delivery.
Include Packaging for Safe Transport
Use sturdy, leak-proof containers and insulated options for perishable items. Add tamper-evident seals to boost customer confidence.
Extra packaging for fragile or cold items can increase shipping costs, weight, and handling time, so factor this into your pricing. For refrigerated products, consider cold packs, temperature-controlled carriers, or limit shipping to local areas with same-day delivery to avoid spoilage.
Step 11: Promote Your Online Food Business
Marketing your online food business is crucial for reaching new customers and driving sales.
To effectively promote your business, you will need to utilize a variety of restaurant marketing strategies, such as paid ads, social media, and more.
Below, I’ve described the four best ways to promote your online food business, followed by additional strategies listed in bullet points.
1. Paid advertising
Paid advertising is a quick and effective way to reach customers and promote your business.
Platforms such as Google Ads for restaurants and restaurant Facebook Ads let you target specific audiences and showcase your products and services.
However, this is one of the most expensive marketing methods. If you’re just starting out, consider trying other, more cost-effective strategies first.
2. Local SEO & Google Business Profile
Optimize your website with restaurant SEO to appear in local search results and attract nearby customers.
Create and maintain a Google Business Profile for restaurants, so your business shows up in Google Maps and local searches. This improves visibility and helps customers quickly find your offer, hours, and location.
3. Social Media Marketing
Restaurant social media marketing is a powerful way to reach customers and promote your business. Platforms like Facebook, Instagram, and X (formerly Twitter) help you connect with your audience, share product updates, and build a community around your brand.
4. Reviews on Google and Yelp
Positive reviews on Google and Yelp build trust and boost local visibility. Encourage satisfied customers to leave feedback and respond promptly to reviews. This improves your reputation and can increase online orders.
More Ways to Promote Your Food Business
Beyond paid ads, SEO, social media, and reviews, there are several other effective strategies to attract and retain customers. Examples include the following:
- Use Email Marketing: Build a subscriber list and send newsletters with offers, updates, and seasonal promotions to keep customers engaged.
- Leverage Restaurant Influencer Marketing: Partner with local food influencers to reach a wider audience and build trust through authentic recommendations.
- Use Marketplaces Strategically: List your products on food delivery platforms or marketplaces to increase exposure, while also promoting direct orders through your website.
- Ask for Customer Recommendations: Encourage satisfied customers to share your business with friends or leave referrals, offering incentives like discounts for word-of-mouth promotion.
- Use Content Marketing: Share valuable content like recipes, behind-the-scenes videos, or cooking tips on your blog and social media to attract organic traffic.
- Print Flyers with QR Codes: Distribute flyers locally with QR codes linking directly to your online ordering page for easy access.