How to start a fish and chips shop

It’s known as the British staple. Each year, we eat an estimated 382 million meals from fish and chip shops, cooking up a whopping £1.2bn according to the National Federation of Fish Fryers (NFFF).

But if you’re feeling tempted to throw your own hook into this thriving industry, there are still plenty of important things to consider. Business overheads are rising, there’s a recession looming, and, post-Brexit, supply chain issues have had major impacts on the UK fishing industry and the wider food and drink sector.

However, these challenges have also brought plenty of opportunity. The tragic closure of many SMEs has meant the availability of premises has improved, while commercial regulations have also eased. Plus, in spite of the cost of living crisis,  customers are hungrier than ever for convenient eating options.

In this guide, we’ll talk you through all this and more to give you all the information you need for setting up a fish and chip store. Our experts will give you helpful tips on everything from launching a website for your business, to choosing accounting software or a point-of-sale (POS) system.

One large portion of help and advice, coming right up….

Should you start a fish and chip shop now?

The list of pros and cons to starting a fish and chip business now is fairly balanced.

Where are the possibilities?

There are plenty of positives on the menu.

For example, a surge in takeaways and dining has meant high street footfall is recovering steadily post-Covid, giving you a much stronger customer base to work with compared to the same period 12 months ago.

According to a recent market report by the British Takeaway Campaign, 38% of households ordered takeaway at least once a week at the height of the pandemic (and that’s just the ones that will admit to it) spending an average of £45 per month in 2020.

Many government support policies, including Business Rates Relief, are also still on offer for SMEs to take advantage of.

Where are the potential problems?

Brexit has meant the fishing industry is dealing with added costs in the supply chain as well as slower or missed deliveries. This is particularly challenging for startups to tackle if you don’t have strong supplier foundations yet.

It’s also not 100% certain whether there will be future lockdowns, which means you might be legally required to close up shop soon after setting up – naturally, this will have an expensive impact on your cash flow.

How can you combat these issues?

Luckily, the above obstacles are not impossible to navigate. New businesses can still establish themselves in today’s market – you just need to engage in careful planning and a more strategic approach.

The main thing to consider if you’re looking to open a new business now – particularly in the hospitality industry – is that you have enough cash reserves to cope with a sudden expense or increase of overheads.

If not, you may need to consider taking out a business loan to cover short-term or emergency costs.

What COVID-19 rules do fish and chip shops need to follow?

In August, all COVID-19 safety rules and regulations were fully lifted, which means that you don’t legally need to require any specific safety measures from customers or staff members if you’re planning to host events.

However, cultural changes have still taken place, including a new understanding about the spread of germs that public places can influence.

There are still some basic safety requirements that help to make your event attendees feel safe, such as:

• Spaced out seating for social distancing
• Hand sanitiser stations
• Increased cleaning and disinfecting rota
• Optional mask wearing

You could consider keeping these rules in place to help returning customers feel more at ease.

Think about a location first

If you’re within the shores of the UK, you’re never more than 70 miles from the sea (the furthest possible inland distance). This means fresh fish can be ferried from the coast to anywhere in less than a day. But, that doesn’t mean you’ll succeed in any high street where you set up roots.

Finding the right location for running a fish and chip shop is a vital first step in ensuring you will have a successful and profitable business.

Finding a premises

You could find an existing fish and chip shop for sale and takeover its existing customer base and equipment, or, if you’re not ready to commit to buying one outright, there are plenty of fish and chip shops for rent.

Before deciding, establish the reasons why the fish and chip shop is being given up for sale in the first place. It could just be that the current management are ready to move onto new horizons, or it could be that the shop has problems beyond control that make it a poor investment.

Here’s what you should consider when choosing a location for your fish and chip shop:

• Low-income area – as an affordable but delicious meal, fish and chips have always found success in low income areas. Provided there’s a ready supply of local punters and not too much competition, a low-income area can represent a good location
• High-income area – though people will have more disposable income, they are more likely to cook at home or go to restaurants in high income areas. That said, a high-quality fish and chip shop could still succeed
• Mixed income/ high footfall – areas such as town centres or busy high streets are going to give you the highest footfall but also cost the most in rent and rates. You may also have more competition.

Other considerations:

• Proximity to competition – being relatively close to competitors can actually be advantageous to a small business. Hungry customers like options, and if yours is the best of the choices, that’s where they’ll spend their pennies. Use nearby competitors strategically to show off your superior offering
• Cleanliness/ maintenance – check for signs of damp or vermin and that the property is maintained. Although things can be cleaned, there are some recurring issues it can be expensive and difficult to deal with
• Reputation – research customer reviews of the fish and chip shop you intend to buy before committing. If it’s got a poor local reputation, you’re going to have to put a lot of time and effort into swinging that around

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Fish and chip shop business plan

Owning a fish and chip shop seems a sure-fire way to capitalise on our bountiful coastal waters and ravenous appetites. But, it’s essential to build in time for some careful business planning before you even think about shipping in that deep fat fryer.

As with any business, you should write a thorough and detailed business plan for your fish and chip shop before committing to anything.

You can find out more in our business plan template.

Your business plan should include:

• An executive summary – summarising the main points of the business plan
• Introduction to the business – mission statement, objectives, legal and capital structure
• Management – establish background and credibility of the management team
• The market – target customers, market trends/ size etc.
• Competitive analysis – strategy, pricing, selling channels
• Operational details – premises, materials, equipment, staffing
• Financial overview – sales and profit, projections, funding requirements

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Should you buy a leasehold or freehold fish and chip shop?

Both leasehold and freehold are solid options for aspiring fish and chip shop owners. Below we look at the differences and realities of each:

Leasehold

A leasehold property is one you only own for a short period of time. Ownership is returned to the landlord when it comes to an end.

Your lease will detail conditions such as whether you need permission to make alterations to the property, and whether you or your landlord have responsibility for maintenance and repairs.

A leasehold represents a smaller investment and is a good way to get started for someone fresh to the fish and chip shop industry. Make sure you properly understand the agreement before signing on the dotted line.

Buying a long lease will make it easier to sell down the line and you could always buy the freehold later on if you’re in a position to do so.

Freehold

With a freehold you will enjoy complete ownership of the fish and chip shop business including alterations, maintenance and repairs.

This will give you the freedom to do exactly what you want with your business but you will have to have more capital.

It’s going to cost you a fair but to buy a decent freehold business in a prime town centre location, though you will find it easier to access a bank loan with a fixed asset.

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Work out how much you might make

One of the reasons for fish and chips’ enduring popularity is their affordability. Whilst dwindling fish stocks and other economic factors have pushed up the cost of the raw ingredients there’s still a decent profit per portion on fish and chips.

That said, it’s still best not to cut corners when it comes to accessing these ingredients. Cheap ingredients make a low-quality product. A lower quality product means fewer punters.

How should you price your business?

Setting a price point for your fish and chips will depend on a number of factors including how much you’re spending on your lease/rent, the demographics of the area and how much you can get ingredients for.

An HMRC estimate of the fish and chip industry states that you might expect gross profits of around 50% – where some achieve more, others less. This comes down to economic preparation, effective portion control and reasonable pricing. All of which you can get advice on from trade organisations, like the NFFF. Other factors like the standard of the premises and image you project is up to you.

How can you attract further business?

Promoting your business beyond a bright and welcoming shop is something several of the people we spoke to were doing. Loyalty schemes, ‘buy one get one free’ offers, and sponsorship of local sports teams or events can all get you better known and build up your business.

Ultimately, the quality of the product is the number one factor in how much you will earn. If it’s good, people will not only come back to you but they will travel out of their way, past other shops to come to yours. And they will tell their friends about you – incidentally something they’ll also do if the product is bad, with the obvious opposite effect.

How can you build a customer base?

Communicate with your customers, make them feel their custom is wanted, tell them how good your fish and chips are, then prove it by delivering a delicious product. Achieve this and you’re sure to be the major plaice for takeaway for miles around.

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Financing your fish and chip shop

Setting up a fish and chip shop takes capital. It may be that you are starting the business with money you’ve saved; in many cases though, people will raise extra money to get started. Fortunately  there are a number of options available:

Startup loans – the Startup Loan company is a government backed scheme where you can borrow up to £25,000 with a fixed interest rate of 6% p.a.

Business loans – business loans are similar to a startup loan, except that they are not just for new businesses and don’t have the same caps.

You should also consider how you will track your finances. It’s best practice to make use a business bank account to separate your personal and business expenses and income.

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Fish and chip shop suppliers

Fish

The two most common fish sold in UK fish and chip shops are cod (62%) and haddock (25%), thanks to their thick, flaky consistency. These can be bought freshly frozen at sea in bulk from fish and chip shop suppliers.

Dwindling stock numbers in the Atlantic have rightly highlighted the need for the industry to encourage sustainable fishing practices. This falls on the shoulders of everyone from trawlers and wholesalers, to suppliers and you the fish and chip shop owner. Because if there’s no fish, there can be no fish and chips…

The most trusted and recognised seal of sustainability is the ‘Blue Tick’ of the Marine Stewardship Council (MSC). The organisation can award it at any stage of the supply chain from fisheries to suppliers and vendors to help businesses and consumers make sustainable choices.

When choosing a supplier, look for the MSC Blue Tick. You should also check that they are well regarded in the industry for their service. Below are a few fish and chip suppliers to choose from:

• Unique Seafood
• Henry Colbeck
• Smales

These suppliers will often sell a range of other essentials including sausages, bread, potatoes, pies, batter mixes and oil.

What oil do fish and chip shops use?

If you want to achieve crispy, golden chips with fluffy centres, you might be wondering; “what oil do fish and chip shops use?”

There are three commonly used ‘frying mediums’ in UK fish and chip shops:

• Rapeseed oil – lower in calories, fat and saturated fat provided oil is in a condition
• Beef dripping – the traditional option but highly calorific and obviously not suitable for vegetarians
• Palm oil – extensively used throughout the fish and chip industry. A vegetarian option. Leading brand FryMax claims to source only sustainable palm oil

How often should you change fryer oil?

There is no definite answer to this – it depends on what you’ve been frying and the quality of the oil.

You should change the oil if it starts to smoke at lower temperatures, if the smell changes, or if the colour darkens. It may also develop a foamy scum on its surface.

It’s important that you look out for these signs: oil that needs to be changed will impair the taste of your food and lead to poor customer reviews.

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Get the right fish and chips equipment

For your fish and chip shop you’re going to need to think about buying a fish and chip shop fryer, buying an industrial cutter, large fridges and a variety of other equipment.

Buying a commercial fryer

When choosing a commercial chip fryer, you should consider whether it is large enough to handle a large volume of orders simultaneously. It should also be easy to empty and clean.

Free standing and counter top models are available in both electric or gas.

Generally, gas fish fryers are more expensive to buy but cheaper to run. A gas fryer can also heat up a lot faster than a commercial electric fryer.

Built in filtration can help to significantly extend the life of your oil, meaning you will spend less time emptying and cleaning the fryer.

Fish and chip shop equipment checklist

Below is a checklist of the equipment you will need to ensure the smooth running of your fish and chip shop:

• Large fridges – for keeping fish fresh. These range in sizes depending on your needs
• Display fridges – for displaying cold drinks to customers
• Chip scuttle – a hygienic unit for storing freshly made chips
• Potato peeling machine – you’re going to be peeling a lot of potatoes for chips. A machine can lift some of that burden
• Batter mixer – to mix the large quantities of batter you’ll need
• Heated food display – to display freshly fried fish and other produce to customers
• Scrap bin – to dispose of any unwanted or unsuitable scraps and keep your kitchen and counter tidy and clean
• Microwave – for rapid reheating of cold food
• Storage freezer – a large storage freezer is essential for all the fresh fish and other produce you’ll need to keep backed up
• Utensils – including scoops, tongs, knives, salt and vinegar bottles

This is not an exhaustive list but is a good jumping off point. If you are buying a fish and chip shop then it may already have most of the essential equipment. Always make sure equipment is clean, maintained and safe.

Remember also, that you will have ongoing utilities costs such as energy and boiler maintenance. You may find it useful to use our business energy comparison page and our guide to commercial boilers to help you make informed choices.

Disposing of fryer oil

You must not dispose of fryer oil by pouring it down the drains as this can cause blockages and attract vermin. You can be prosecuted for improper disposal of waste oil.

There are organisations across the UK that will collect your used cooking oil and recycle it as renewable biodiesel.

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Taking payments in a fish and chip shop

Below we look at the hardware you’ll need to take payments from your customers.

Fish and chip shop POS system

To take payments from your customers you’ll need a point of sale (POS) System.

Not just a cash register, these include a touchscreen monitor and computer a receipt printer, and a barcode scanner.

They can also help a fish and chip shop owner with inventory management, stock control, staff hours, and loyalty schemes should you have one.

The hardware including the credit card readers and receipt printers range in price and quality:

• Credit card readers– £80
• Receipt printers– between £150 and £400

It may be cheaper to buy the hardware and software as a complete package costing an average of around £1,499 or around £19.99 to rent per week.

Find out everything you need to know about the point of sale system costs here and review the best small business  POS systems.

Fish and chip shop PDQ reader

Any modern chippy should be prepared to take card payments from customers. If you’re not equipped, you’ll be missing out on a significant source of revenue as fewer and fewer punters feel the need to carry cash.

A process data quickly (PDQ) machine allow you to quickly and efficiently take card payments. There are a number of ongoing costs including transaction fees, monthly fees and topping up till roll. You can either lease or buy.

Comply with fish and chip industry regulations

Because of the high potential for unhygienic food establishments to represent a serious health risk to the public, there are a number of rules and regulations you need to be aware of if you don’t want to risk closure.

First and foremost, you must register your fish and chip shop business with the local authority at least 28 days before trading or before food operations start.

You can find out about and register your food business on Gov.uk.

If you have five or more employees it is a legal requirement that you have a written health and safety policy detailing procedures.

If you are responsible for looking after food safety management procedures at your establishment, you must have had training on food safety and hygiene and have a food hygiene certificate.

How to get a food hygiene certificate

A number of organisations offer relatively affordable training for food hygiene certificates ranging from food safety awareness, to food hygiene and safety, to supervising food safety.

Make sure you use a provider that’s approved such as High Speed Training. Food hygiene certificates do not have an expiry date.

The Food Standards Agency advises that, when staff are preparing or handling food they should:

• Keep hair tied back and wear a head covering such as a hat or net
• Not wear a watch or jewellery (except a wedding ring)
• Not touch their face and hair, smoke, spit, sneeze, eat or chew gum

Hand washing is the cornerstone of good food hygiene in order to prevent the spread of bad bacteria.

Any staff working with food must wash their hands:

• When in the kitchen or preparation area
• Before preparing food
• After touching raw food
• After handling food waste or emptying a bin
• After cleaning
• After blowing their nose
• After touching phones, light switches, door handles and cash registers

Employers’ liability insurance

Your employees are going to be exposed to plenty of risks in your fish and chip shop. Knives, heavy equipment, burning hot oil.

Read more: What is employers’ liability insurance?

You are legally required to have employers’ liability insurance up to the value of £5m if you employ one or more people.

This will protect you against the financial cost of a claim against you in the event that an employer is injured or becomes ill as a result of working for you.

Public liability insurance

Your customers are also at risk so you should also take out a public liability insurance policy.

A public liability insurance policy will cover the legal costs for any claim made by a member of the public in the event of an injury or accident in your fish and chip shop.

Read more: Does your business need public liability insurance?

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Get creative with your fish and chip shop branding

As well as their status as the country’s favourite hearty convenience food, British fish and chip puns have a long lineage in the national psyche.

Indeed, its historical relationship to British industriousness, entrepreneurialism and fighting spirit cannot be understated: fish and chips exploded during the industrial revolution as railways linked the coast and cities, fuelling the hungry workers of England’s manufacturing towns. And during both the first and second world wars, the dish was made exempt from rationing by Lloyd George and Winston Churchill respectively; such was its importance to national morale.

There’s even an Oscar’s of the fish and chip shop world – the National Fish & Chip Awards, which assesses the country’s chippies on responsible sourcing, menu diversification, customer service, and quality.

To help stand out in this creative market, you may want to think about your brand name. Notable examples of punny fish and chip shop names include:

• The Codfather
• Fishcoteque
• A Fish Called Rhonda
• Frying Nemo

You should embody that spirit with your branding – fun, bright, colourful, engaging, simple – and keep your shop front and sign well-maintained and painted.

A scruffy exterior with faded, cracked paint and grimy windows will make potential customers think of dirty fish and chip shop interiors.

Likewise, keep your counter clean and uncluttered and have bright, easy to understand chip shop menus boards.

It’s also worth considering whether you’ll need a website for your shop – we’ve compared a few top web builders below. These are easy to use and can help you to create a professional site, even if you don’t have experience in web design.

Hiring fish and chip shop staff

According to the government’s National Careers Service, a fish-frier working in your shop can expect to earn between £13,500 to £16,000 a year, though many roles are part-time.

They should have a food hygiene certificate if they will be handling food, but this can be earned on the job.

Here are some other positions you might want to hire for if you own a fish and chip shop:

• Counter assistant – these will take orders and payments, and could also be involved in the preparation and frying of fish and chips
• Food preparation assistant – these are the people that keep the engine running in the back, prepping ingredients and ensuring the front of house has everything it needs to keep up with customer orders
• Fish fryer – will cook the fish and chips to order
• Manager – managers are responsible for ensuring the day to day running of a fish and chip shop. This involves taking stock and ordering supplies, ensuring health and safety, managing staff, and ensuring the business is profitable
• Waiting staff – this will only be necessary if you have a shop floor and tables that need to be served

The NFFF and Seafish have partnered to offer two learning programmes in a bid to raise standards across the fish frying sector.

• The fish frying skills qualification – covers frying skills, food hygiene, and health & safety
• The customer service skills qualification – customer service, food hygiene, and health & safety

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Selling a fish a chip shop

If you’re ready to move on from the fish and chip shop sector, or to move to a new location, you can use on of the many fish and chip shop transfer agents to sell it on.

They or a prospective buyer may want to know:

• Asking price
• Turnover
• Net profit
• Lease terms
• Rent
• Location
• Details about the premises
• Trading hours

Offer a reasonable price for your fish and chip shop and be honest about the details and you’ll be well on the way to exiting your fish and chip shop business.

Next Steps

The fish and chip industry might be hugely competitive, but with the tips, tricks and tools in this guide, you’ll set yourself up with the best chance of success.