How to Open a New Restaurant
Running a restaurant is more than just offering food in exchange for money. You will be offering an experience to customers based on items such as the decor, food, and service. As the owner, it is up to you to determine the type of experience you want to give customers. Even after you've decided on the type of restaurant you want to open, you need to make sure there is a market for it, the concept is within your budget, and you can find the right location.
Decide if Owning a Restaurant Is Right for You
Running a restaurant is hard work that involves long hours spent away from home. Although it can be gratifying to run your own business, it is not as glamorous as it seems. Ask anyone in the food business and they will tell you about their long hours that can include weekends and holidays. It’s important to understand the various jobs that are involved in running a restaurant, such as bookkeeping, cooking, dealing with customers, and managing staff to take on some of those responsibilities.
Decide on a Restaurant Concept
Deciding on the type of restaurant to open involves several considerations, which may be influenced by your personal preferences. Often, people who open their own restaurant serve food they like to cook in an atmosphere in which they feel comfortable. However, other people may be interested in franchising. Restaurant franchises offer a number of benefits, including instant name recognition and built-in marketing. But, many restaurant franchises are not cheap and owners must be willing to follow a stringent set of rules.
Choose a Location for Your Restaurant
Location is vital to the success of any restaurant. There are several factors to consider when searching for that perfect restaurant location, including population base, local employment figures, and accessibility. Once you find that perfect location, you will need to make sure you negotiate the best lease possible for your restaurant.
Know Your Customers
Baby boomers have distinctly different dining preferences than millennials. Parents with small children have different needs than singles or empty nesters. As you prepare to start a restaurant, it's important to understand the makeup of your core customers. Researching your area's population base will provide you with important demographic information that can impact your restaurant's bottom line. Items such as housing value, average household income, and average age will give you a good indication of your potential core customers.
Once you have that information, you can consider it in light of existing restaurants in your area.
Write a Business Plan
To prepare for your interview with the bank, you should create a business plan. A plan that outlines your restaurant and how you expect to make it profitable will show the loan officer you mean business. Also, determine the paperwork you need to bring, such as personal income statements and tax returns.
Select the Perfect Restaurant Name
Restaurant names may reflect a theme such as a culture or simply be a play on words. The important thing to consider is the impression the name will leave on customers. Select a name that will be easy for customers to remember and spell. Nothing is more frustrating than not being able to find a restaurant listing because you aren't spelling it correctly.
Write the Menu
Your menu is important to your restaurant's success. After all, it is essentially why your customers keep coming back; they love the food. The layout and design are just as important as what’s listed on the menu. Avoid amateur-looking menu designs, such as clip art or photocopied handwriting. Finally, knowing how to price the menu will help increase your profit margins, giving you more money to invest in your restaurant.
Staff Your Restaurant
Hiring the right staff is crucial for any new restaurant. Good food loses much of its appeal if it is accompanied by bad service. Knowing basic employee roles for front-of-the-house staff and back-of-the-house staff will help you select the best candidate for the job. Experience counts for important positions, such as head cook, dining room manager, and bartender.
Purchase Equipment for Your Restaurant
Outfitting your restaurant kitchen, dining room, and bar is the largest part of your start-up budget. Start with the basics. Shop for deals advertising used and leased restaurant equipment. Resist the temptation to buy unnecessary furniture and equipment, which can set you way over budget.
Before opening a restaurant, there are many items to consider to assure its success. The main consideration is the amount of time that will be required to run the restaurant, as well as an ability to manage it successfully. You will need to determine items such as the restaurant location, name, decor, food, and menu, and write a sound business plan to obtain the proper funding. Overall, it is important to gather as much information as possible before heading into this type of venture.