Before setting up your food service business, you will need to incorporate your company. During the company incorporation process on Companies House, you will need to provide your company’s SIC code based on the nature of your business and services. There are over 600 codes on the list of SIC codes to choose from which can be overwhelming, especially as several concern food service activities. This article explains what a SIC code is and how to choose one for your new food service business.
What are standard industrial classifications?
A Standard industrial classification code (SIC code) is a five-digit business code which describes a company’s economic activities and business services. These codes help the Office for National Statistics (ONS) track the state and growth of United Kingdom (UK) companies. The condensed UK SIC code list maintained by Companies House is available on the gov.uk website. A private limited company (the most popular type) can have multiple SIC codes. Dormant companies and non-trading companies are also required to have a SIC code.
Your food service business can have multiple SIC codes if it has multiple business activities. SIC codes can also be updated via a confirmation statement if ever the business’ activities evolve or you carry-out new activities.
What SIC code should I use for my restaurant?
The SIC code that you should choose for your restaurant depends on the type of restaurant you are going to create. The first question to ask yourself is whether you will be serving alcoholic beverages in a full-service restaurant. If you are going to serve alcohol with food in your restaurant you will need to use the SIC code 56101. However, if you are only going to serve soft drinks, like in eating places such as ice cream parlors or pizzerias, you will need to use the SIC code 56102 for this types of business.
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What SIC code should I use for my take away restaurant?
Whilst the services of alcohol is material in deciding what SIC code to pick for your food service business, you also need to determine whether you will offer your customers a dining or experience of whether the food that you produce will be ‘take-away’ only, such as in the case of mobile food stands, snack shops or some fast food restaurants. If this is the case, you will want to use the SIC code 56103 that covers take-away food shops and mobile food stands where there is immediate consumption of food as opposed to a sit down experience.
What SIC code should I use for my coffee shop?
Assuming that you will not be serving alcohol and will provide a sit-down experience for your customers in your cafe, you will want to use the SIC code 56102 which applies to unlicensed restaurants and cafeterias.
What SIC code should I use for my pub or bar?
If your pub serves food you might want to consider using the SIC code for licensed restaurants. However, if your pub or bar does not serve meals or food products, you should use the SIC code 56302 that is used to cover public houses and bars. This SIC code is usually adopted for all business that operate primarily as drinking places.
Once you have navigated the industry classification system and chosen a SIC code for your food service business and finalised the incorporation process, you will need to generate legal contracts to structure your business activities. Creating lawyer-approved agreements can be costly and it can be tempting to download free templates online. However, this process is risky and unnecessary thanks to contract management platforms like Legislate. Legislate allows to tailor the essential agreements to hire and grow your business such as employment, consultancy and internship agreements. To create a lawyer-approved contract for only £9.95, sign up to Legislate today!
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The opinions on this page are for general information purposes only and do not constitute legal advice on which you should rely.