One of the most popular businesses to start is a restaurant, but there is a lot of thought and planning that goes into it. Owning a business is a dream many people choose to follow, but many can’t make it work.
They either don’t plan enough or try to move to fast and miss important steps. If you want to know how to start your own restaurant, then we created this extensive guide to help you. It covers everything from planning your menu to choosing the right staff.
If opening a restaurant is your dream, then make it a reality by following this guide.
Table of Contents
Get Restaurant Experience
If you want to own and run a restaurant, then it’s a good idea to have experience in the restaurant industry. Ideally, you started at the bottom such as wait staff or kitchen crew, and went up the ladder to management.
It’s hard to predict what you’ll need to run a restaurant if you haven’t been in one. Many restaurant owners have extensive experience in the industry and use that to help make their business a success.
That being said, it isn’t mandatory. If you plan on just being the owner, then you’ll need to hire a manager that can help you with the nuts and bolts of running the restaurant. It’s not a good idea to start a restaurant if you have no experience and no one to help you.
Choose Your Restaurant Style
Do you have a family recipe for the best spaghetti in the world? Have you been making amazing meals for decades and want to share them with people? You need to choose what kind of restaurant you want.
Do you plan on creating a franchise of a popular restaurant and serve their food? Do you want to create an Italian, Greek, American restaurant? The type of restaurant you want is important because it helps decide everything from where to locate your business to the decorations.
This is the first and most important part of opening a restaurant. It shouldn’t be a spur of the moment decision. Franchises have an established customer base but can be expensive to start up. Check your area for other restaurants in your niche to see if there is a need or if you should look outside of your area.
Do your research and choose a style that excites you, but also makes sense for your expertise. Be careful of trends as they can be popular at first but lose their excitement over time.
How to Start Your Own Restaurant: Develop a Business Plan
Unless you’ve been saving up for a while, you’ll need a business loan. Most banks and lenders require a business plan before they agree to provide you with a loan. A business plan is a comprehensive document that explains why you want to start a restaurant and how you plan on running it.
It’s an overview of your plan for creating all aspects of the restaurant and how much money you’ll need. You need to provide information about where you want to go, what kind of food you’re serving, where the money you’re given goes, etc.
It not only helps the lender understand that you’re serious but also provides a plan for you to follow. You must research the type of customers, the competition in your niche, where you want to locate it, marketing, and more.
The bank needs to know that the restaurant has a good chance to make money, so you can pay back the loan. Your business plan plays an important part in the lending process.
Get Your State, Federal Information in Order
You’ve developed your plan and secured funding, so know it’s time to start the ball rolling. You’ll need to register for a tax ID number, get permits from the local municipality, and register for state and local taxes.
All businesses need insurance that covers them in case of disaster, liability, and more. You can’t create a business until you’ve handled all the permits and paperwork for the state, federal, and municipal governments.
Make sure to keep copies of all paperwork and file them, so that you can reference them if needed. You should also contact accountants to begin a relationship for taxes, payroll, etc. You have your hands full with starting the restaurant so leave the number crunching to someone else.
Develop Your Look
Every restaurant is different and has a special quality that is all its own. You need to think about the décor, the feel, and how to put everything together into a cohesive look. It’s easy if you have a franchise because much of this is done for you.
If you’re creating your own restaurant, then you get to develop a look all your own. The look incorporates not only in the décor, but your menus, marketing, etc. You need to create a name for your restaurant and a logo that shares the feel of your new restaurant.
You might want to meet with an interior designer to help create the look. They can help you from start to finish and implement the look when you’re ready.
All of these are only on paper, but soon you can implement them.
Finding Your Building
A restaurant needs to have certain conditions if it is to be approved by the health department. When it comes to a building, you have several options. You can purchase land and build it to suit your restaurant.
This lets you have the floor and kitchen plan you want. The biggest problem with this is the cost of not only purchasing the land but also creating the building. You need to hire contractors, subcontractors, and keep an eye on the budget.
Another option is leasing or buying an existing building. If the building was a restaurant, then it should already have everything needed for state and local laws.
The benefit of leasing a building is you don’t have to worry about building insurance and you’re not stuck in that spot. If you discover the area isn’t what you hoped and want to move, then you can move when the lease is up.
Buying a building is nice because it’s yours. You have no landlord with rules and regulations you need to follow. For example, some landlords require additional insurance or won’t permit certain renovations. The biggest problem is if you do want to move, then you either must sell it first or keep paying for it while you find a new place.
Major Appliances and Furniture
Once the building is secured, you can start filling it up. You’ll need to research ovens and other appliances you’ll need. There are many different types of restaurant furniture from chairs and tables to wait stations, stools if there is a bar, and much more.
This is where an interior designer would help to choose the perfect furniture to go with your niche. Please keep in mind your budget. You can find furniture at a great price by choosing companies that specialize in this type of furniture.
Keep in mind that when it comes to the appliances that you need commercial grade and not residential.
You’ll also need supplies, computers, etc. for the office. You can have a cash register and point of sale system. There are many digital alternatives now for taking cash and credit cards.
Deciding on an Opening Date
When it comes to starting a restaurant, every minute that you’re not open costs you money. You need to decide on an opening date that fits your schedule and is a good time to get people. For example, you may be ready to open in winter, but you might want to wait until spring so it’s easier for people to come.
You don’t want your opening night marred by a blizzard. When you choose your opening date, it’s a good time to think about employees. The type and number of employees you hire depends on the size and scope of your restaurant.
A small restaurant may only need a few experienced cooks and wait staff. A large restaurant may need managers, a seating hostess, assistant managers, parking valets, etc. You’ll need to put ads in the newspaper and the Internet, interview the candidates, decide on how many hours you want to give them, and a starting wage.
People interviewing for a full-time position may expect 40 hours a week, health insurance, vacation days, and more. You need to train the staff in the restaurant before opening. They need to know the menu, taking care of the customer, and your philosophy.
Do you plan on having uniforms or have them wear black pants and a white shirt?
Marketing Your Restaurant
While you’re creating your restaurant, the local rumor mill lets people know something is coming in there, but it’s through proper marketing that you get the most people.
You’ll need a website that details your restaurant, menu, hours of operation, etc. You can choose to have people order through the website for pick up and delivery or to make reservations. A website isn’t something you should do on your own and is best done by professional web designers.
Today’s customers check the Internet before choosing a place to eat. You can also start social media such as Facebook and Instagram before opening to tease people about the opening. Show them pictures of the food and the inside of the restaurant.
You can market your restaurant online through pay per click ads on Google, Bing, and certain social media sites. There is also traditional marketing such as television commercials, radio ads, and newspaper ads.
Many restaurant owners don’t appreciate the importance of marketing. They prefer to spend the money on the restaurant, but unless people know you’re opening and where you are, they can’t get there to taste your amazing food.
While you’ll always have marketing expenses, your grand opening should be something special. Spend more than you usually would to maximize the number of people coming to your opening day. You can also provide discounts and special offers that are only available on your opening day.
It’s Time to Open
You’ve got everything together and the staff is trained and prepared. It’s time to open. Your first few months will be difficult as you iron out all the bugs that you only discover when you go live. You’ll be inundated with customers because you’re the new restaurant in the area.
After a few months, the excitement dies down and typical restaurant life emerges. Every six months, you should evaluate your practices, employees, etc. to determine what can be improved.
Can you shave time off your deliveries? Should you add new dishes? Are your employees happy and courteous to customers?
This is when you’ll know if your restaurant makes a profit or a shortfall. Many restaurants start strong but become complacent and find customers and revenues dwindling.
The key to success is vigilance and innovation. You can never be stagnant and always need to look for ways to streamline costs, improve customer experience, and grow your reach. It’s the difference between shutting the doors in a year or building your second location.
Make Your Dream a Reality
There are many successful restaurants that become legends in their area. It doesn’t matter if you’re starting a new franchise or your own new restaurant, you need to prepare to make it a reality.
This guide has everything you need to begin your journey. This guide teaches you how to start your own restaurant, but it’s your job to follow through. Don’t take any step lightly because each one can mean the difference between success and failure.
If you want to know more about starting a restaurant, then please explore our site.
Infographic created by Clover, a credit card processing company