Starting a restaurant business is the dream of many culinary enthusiasts out there, and being able to bring joy to people through food is a feeling like no other. If you are one of those people who would love nothing better than to share your love of good food with the world and you feel almost ready to make that dream come true, take a look at these tips on how to open a restaurant. And once you have a plan, time to get cooking!
Define what you want your restaurant to be
We’ve all heard the saying, “Jack of all trades, master of none”, right? This old adage is truer than many people realize –– it’s difficult enough to do even one thing perfectly, let alone succeed at ten different ones. All this is to say that one of the cornerstones of any successful businesses, restaurants included, is understanding what it is you want to specialize in. This could be a particular cuisine –– Thai, Italian, Peruvian –– or a certain type of dish, say, soups or salads. Granted, there are plenty of successful fusion restaurants, where two or more different cuisines are combined to create something new and unique, but even those have a certain theme they stick to. Let’s be honest –– nobody is going to take a restaurant that offers perogies, Korean BBQ and souffle very seriously…even if you really do make fantastic perogies and souffles! You are going to need to be consistent, so take some time to think about which direction you really want to go in and stick with it. Not to mention your potential investors will be much more open to supporting a restaurant that knows who it is.
Create a business plan and get investors
Speaking of investors, you’ll likely need some to get your restaurant off the ground, unless you would prefer to depend on bank loans or loans from family and friends. Either way, anyone opening any kind of business needs a good business plan to keep them grounded in reality. When we are on the verge of doing something we’ve always dreamed of doing, we tend to underestimate risks or even ignore obvious warning signs. A well-written restaurant business plan will confront you with the cold hard numbers so that you can plan ahead and avoid unexpected financial problems in the future. Opening a restaurant is by no means cheap!
If you will be presenting your business plan to potential investors, you will need to produce a concrete, specific, multi-page document that will get into the details of what exactly you’re planning and how much it will cost. How many employees will you need? What kind of furniture, dishes and cutlery do you plan to buy? How much will it cost to decorate the restaurant’s interior? What kind of equipment is necessary to cook the dishes on your menu? Will you be delivering? If you, do you have a car or will you be cooperating with a food delivery app? Who is your target group and can they afford the prices you are planning to charge? What kind of marketing activities do you plan to engage in, and how much will they cost?
Industry analysis is also an integral part of not only your business plan, but success in general, as it examines issues such as local competition and the buying habits of people residing in the area you want to open up shop in. A business plan will also allow you to calculate how much you will need to sell to make a profit, and how long you can afford to exist before you start doing that. Beginnings can be tough, but the better prepared you are, the easier it will be.
Find out what kinds of permits you will need
There are several different permits and licenses you will need to open your restaurant. First and foremost, you will need a business licence to operate legally. Including the registration and filing fees, this could come to around $500 or more.
The second most important license you will need to have if you plan on selling any alcohol at all is a liquor license. Every state has different requirements you will need to meet in order to obtain a liquor license, but one thing is for sure: it will take a while, so the sooner you apply, the sooner you will be able to serve your clients fine wines with their steaks. Full liquor licenses can cost anywhere from $12,000 to a whopping $400,00, but beer and wine liquor licenses commonly cost around $3,000.
Next up, the Foodservice License. This one does not cost much at all, typically from $100 to $1,000. The catch here is that in order to obtain it, you will need to undergo a personal visit from your city’s health department during which they will likely examine every square inch of your restaurant. It is nerve-wracking, we’re not going to lie.
You will also need to make sure your employees all have Employee Identification Numbers, which are basically just tax ID numbers from the IRS. This one formality, thankfully, is free.
Last but not least, the Food Handler’s Permit. This permit is somewhat similar to the Foodservice License described above, but this one involves you and your employees completing a state-approved food handler’s course proving your knowledge in the area of food sanitation, storage, preparation and protection. Once you’re done with these, you can finally start serving customers!
Choose a restaurant staff scheduling app
Planning how you will manage your staff is another integral part of successfully opening a restaurant. No matter whether you plan on having just a few employees or many, figuring out how you’re going to manage their schedules is something that will help your restaurant run smoothly from the get-go. The days of drowning in a sea of charts trying to figure out who can take Maria’s shift after she called in sick are over, and a good thing, too! The right technology makes it so much easier to stay on top of everyone’s schedules. There are numerous scheduling apps to choose from, depending on the size and type of restaurant you plan to open. Zoomshift, Schedulefly, Better Chains, 7 shifts and Hubstaff are among the most popular restaurant scheduling apps currently on the market, though there are dozens of others. Be sure to research them in detail and choose the one right for your business.
Research some fun restaurant promotion ideas
The internet is chock-full of restaurant marketing campaign ideas, so there is plenty of inspiration free for the taking. You can sponsor a local sports team to market your restaurant locally, have live music once in a while, offer cooking classes…or anything else you can think of!
There are also a few must-haves every restaurant or indeed business that hopes to be successful needs to take care of. They may be a lot less fun than a cooking class, but like eating your peas, they will benefit you in the long run even if they seem a bit mundane now. The first of these is to get on Google My Business. It only takes a few minutes to set up a Google My Business profile for your restaurant, but it can make a world of a difference to first-time customers trying to find your establishment. Better yet, Google My Business is free, and you only have to set it up once. Secondly, get active on social media! Facebook and Instagram are not everyone’s cup of tea personally, but they can be extremely powerful when it comes to getting the word out about how great your food is. Taking nice pictures of your dishes and using the right hashtag can attract lots of new customers, not to mention that social media is the perfect place to organize different raffles and competitions to get a buzz going around your brand.
Plan out your menu
This doesn’t just mean the dishes that are going to be on it, though that is a great place to start. The general rule is to not overdo it with the number of dishes available on your menu so as not to confuse and overwhelm potential customers –– the general consensus is that 15 should be enough. If you are absolutely set on offering more, consider having a separate menu for breakfasts or brunches to keep things from getting too crowded. You might want to come up with a few restaurant daily special ideas to keep things interesting –– people love it when you change things up a little.
Then there’s the menu card design. There are plenty of online menu builders you can use for free, and there are menu building apps, too! You could also consider getting a graphic designer to whip up something really unique and classy, though that would require a higher budget. At the end of the day, what’s most important is that the menu is clear, and that its style reflects the atmosphere you are going for at your restaurant.
Get ready to wait
Rome wasn’t built in a day, nor is your restaurant likely to be wildly successful overnight. This is not meant to sound discouraging, it’s simply the reality of how long it typically takes for a restaurant to make a name for itself and get enough return customers to turn a real profit. Almost any seasoned restaurateur will tell you the first year is the worst, filled with faulty equipment, unreliable employees, and delicate new relationships with customers that take time to really take root. Something is bound to break down, something will get stolen (yes, people do steal cutlery from restaurants), glasses will shatter. One day you will feel terribly understaffed and spend the day running around like a chicken with its head cut off, the next half of your employees will sit around on Instagram half the day. Running a restaurant, even a small one, is a gigantic organizational endeavor, and it takes time to understand how everything works and plan accordingly.
Don’t panic, though. Keep checking your data and comparing it from week to week, observe as much as you can and learn from your observations. It will take you a while to get to know the restaurant you created. Keep calm and carry on, and your hard work and patience will pay off.
There is no one recipe for how to open a restaurant, but hopefully, following these tips will help make the process as smooth as possible.