It’s no secret that running a restaurant is tough. In fact, 60% of restaurants fail within their first year. With that said, don’t feel discouraged if you dream of owning your own eating establishment.
The first step to having a successful restaurant is to plan extensively. This will ensure that you stand out in a competitive field and that you are prepared for any challenges that come your way.
Keep reading to learn how to open a restaurant.
Narrow Your Options
We aren’t going to sugarcoat it, eateries are abundant out there and it takes something special to keep them running. If you’re thinking of opening up your own restaurant, you’ll need to find your niche.
Is there a specific type of cuisine, convenience, or service that you see is missing in your area? Any type of food that people might be craving? Do you need to open another pizza shop when there are so few cafes?
Narrowing your options down, in the beginning, will help you think critically about the type of restaurant you want to open and its potential success.
Create a Business Plan
As eager as you might be to open your doors to the world, you’ll need to take the time to create a business plan. This is the recipe to creating a business that lasts.
Making a business plan is all about answering questions about your future business. This will force you to think about the viability of your overall plan, what market you’ll serve, and any challenges you may not have otherwise thought of.
If you create a good business plan, you’ll be able to define the next steps involved in opening your restaurant.
Choose the Name and Legal Structure
Once you have a unique name for your restaurant, you’ll want to file your DBA (doing business as) name with your state’s agency. This will ensure that your name idea isn’t taken by another business.
After you’ve decided the name of your future restaurant business, you’ll have to choose a business entity type. This impacts how you file both state and federal business taxes, the roles of each team member, and how you can be held liable if someone files a legal claim against your business.
This is a huge decision that can impact your entire business structure so it’s a good idea to consult with a business attorney to help you make the right choice.
Research Funding Options
After you’ve set up a name and business entity, you’ll need to obtain funding. Most people don’t have enough capital on hand to cover the cost of opening a restaurant without some sort of financial assistance. To make your dream of restaurant ownership a reality, you’ll need to secure funding from outside sources.
Create a budget by roughly calculating how much restaurant startup costs will be. Keep in mind that you’ll need to include the cost needed for day-to-day operations. You can use this information to predict the total cost of running your restaurant for a year.
Compare the budget to how much money you have available to invest in the restaurant. Once you know how much you’ll need, you can look for loans or investors to help you meet your financial goals.
Secure Permits, Licenses, and Insurance
To start a new restaurant, you’ll need several local, state, and federal permits and licenses. Enlisting legal counsel when filing for these will help make sure you don’t miss a step.
For starters, you’ll need a business license to operate in the US. You’ll also need an Employee Identification Number, this will help you officially hire employees and set up your payroll.
You’ll need a food service license and a liquor license if you plan to serve alcohol at your restaurant.
Design Layout and Space
When you’re designing the layout of your new restaurant, you need to consider the front-of-house space and the back-of-house space. Each has its own unique requirements. If you don’t feel comfortable with your design skills, consider working with an industry expert to create a layout that meets your needs.
There’s a handful of things to keep in mind when designing your dining room. Seating capacity, ambiance, decor, furniture, and cleanability are some of the main considerations.
You’ll also want to think thoroughly about the design of your kitchen. This is where the magic will happen so it’s important that the cooks feel comfortable and that everything is made to work efficiently.
For example, if you’re serving a signature tuna dish then you’ll need to make sure everything is set up for success. Be sure to check out bluefina.com for maguro tuna dish tips.
Find a Food Supplier and Equipment
Before opening your restaurant, you’ll need to make sure that your kitchen is outfitted with the right equipment. Every restaurant has a list of necessary equipment like cooking gear and refrigeration units. Depending on the food you’re serving, you might need specialized equipment.
You’ll also need to find a food supplier that you can work with regularly. Some suppliers offer membership discounts and free shipping if you order bulk supplies.
Hire the Staff
Once you reach the hiring stage of your new restaurant, you’ll have the opportunity to create a great work environment from the beginning. Put a lot of thought into the training program, employee benefits, and incentives. Employee retention is necessary to keep your restaurant a success.
Time to Market Your Restaurant
Once you’re close to the grand opening, you’ll need to get the word out and attract future customers. Advertising basic information about your restaurant like the location and type of cuisine is a great first step. You’ll want to take it to the next level by building excitement around your brand.
How to Open a Restaurant
Despite the recent hit, restaurant sales are projected to be around $789 billion. Many people dream of opening their own restaurants, feeding their food to hundreds of people a day. Unfortunately, it’s a competitive market, and building something that lasts can be tricky.
Luckily, you can prepare for any challenges by preparing extensively. Knowing how to open a restaurant requires a lot of research and patience but it’s worth it in the end. Using this checklist will ensure that you minimize any stress and can focus on having a successful business.
Looking for more articles like this? Browse our online magazine for some more healthy lifestyle tips!