Dreaming of opening your own restaurant? Starting a restaurant is hard work, but with our guidance, you’ve got this! Once you’ve decided to open a restaurant, you will need to create a restaurant concept, a business plan, and, of course, get cooking. Don’t worry, we will walk you through everything you need to know to open the restaurant of your dreams.
Develop A Concept
When opening a restaurant, it’s all about the concept. It’s also a fun place to start when dreaming up your business. A restaurant’s concept includes the type of food, atmosphere, service, and even menu design.
Are you planning to open an upscale fine dining restaurant with white tablecloths and five-star service? Or are you thinking of starting a nautical-themed shrimp shack? Your concept will determine everything that follows in the planning of your restaurant. What type of food you serve, what your employees wear, how you design and price your menu all start with the concept.
Who Is Your Target Customer?
The first step in designing your restaurant’s concept is deciding what kind of customers you want to attract. Do you want your restaurant to be the cool, local hangout for teens? Then you would probably want to serve affordable food with a casual, young vibe. Or are you appealing to a more mature crowd that would prefer more refined food and a calm atmosphere?
Think about your restaurant’s location. What types of people live near your restaurant? It is important to create a restaurant that suits the area it’s in.
What Type Of Food Service Will You Provide?
Keep in mind that when developing your concept, you have several options when it comes to what type of service you will provide. Common types of services include:
- Fine Dining: Upscale restaurants have sit-down service, table cloths, and valet parking.
- Casual Dining: Customers may order at a counter. Casual restaurants appeal to families and are convenient for pretty much everyone. You may even offer delivery or to-go services.
- Fast Food: Fast service and affordable prices. Typically serve burgers and fries with a drive-thru option.
- Quick Bites: Including smoothie and juice shops, coffee shops, and bakeries.
There are also some newer options for service, such as ghost kitchens.
- Ghost Kitchens: Ghost kitchens are an extremely popular type of restaurant. They are delivery only establishments, often with a strong concept. You can even open up a ghost kitchen using pre-made menu and marketing materials. Companies like Nextbite will create the concept and menu. All you have to do is fulfill the orders.
Create A Menu
After you know your target customer and have a concept for your restaurant in place, the next step is to create your menu. When creating your menu, you should think about what type of food your target customers will enjoy and what budget they will most likely have. For example, if you are creating a burger joint for teens and families, you don’t want to include items on your menu that will be too expensive.
Make sure to invest time in creating a menu that is visually pleasing and easy to read. Use your restaurant’s branding on the menu to create a uniform aesthetic. A well-designed menu is key to a restaurant’s success.
Your menu is especially important if you’re a ghost kitchen because all your customers see is your menu. A strong concept and brand are vital for ghost kitchens. You may even want to hire a professional to design your menu and marketing materials.
Pricing your menu will determine your restaurant’s profit and ensure financial success. For an in-depth look at menu pricing, check out this article for a step by step guide.
Create A Business Plan
Now that you have thought through the overall concept of your restaurant, the next step is to create your business plan. You’ve dreamt it up; now it’s time to write it down. Your business plan should include:
- Company Overview: Begin this section with a concept summary. Summarize the overall concept for your restaurant. Writing it down will help you to get even more specific.
- Elevator Pitch: Your company’s elevator pitch is basically how you would pitch your restaurant to potential investors. Make sure your pitch is short, sweet and tells people exactly why your restaurant will be great.
- Menu and Concept: Create a sample menu and keep any design materials you have together.
- Equipment Needs: Make a list of all the equipment you will need to execute your menu.
- Ownership Structure: Include who plans to own the restaurant. Either one person (a sole proprietorship), a group of two or more people (a partnership), or an LLC (Limited Liability Corporation).
- Management Structure: Who will manage your business on a daily basis? Will you do it yourself or hire someone?
- Location Info: Include your choice of location or prospective options. List the rent, estimated utilities, and details about the surrounding area.
- Customer Analysis: Compile research about your target customers, such as how much they make, how much they spend, how old they are, etc.
- Competitor Analysis: Research what other businesses are nearby. Note restaurant competitors; this will help you differentiate yourself from the pack later on.
- Marketing Plans: What is your marketing strategy? Will you market your own restaurant or hire professional help?
- Financial Strategy: You will need to lay out your financial plans in great detail. Include how much money you have, how much money you will need to open, determine whether or not you need to apply for a loan, and calculate when–after opening–you will be able to make a profit.
Creating a business plan will take a lot of time and effort to complete. However, once you are finished, you should have everything in order to actually get your restaurant up and running.
Choose A Location
Once your business plan is in order, you can finally start to make some moves. You will want to look for a location that:
- Is highly visible.
- Has good foot traffic.
- Is in an area where the demographics are your target customer.
- Has available parking nearby.
- Has a layout that will work for your vision.
- Isn’t near too many similar restaurants.
Consult your financial plan and get your money in order. If you need to secure a loan, you will have to do so before signing a lease for your space and renting equipment. There are many ways to pull together the money you’ll need to open a restaurant. Loans, partnerships, investors. Do some research and determine what strategy will work best for you.
You’ll need to obtain all necessary permits to begin operation, including:
- Business License: All US businesses need a license to operate.
- EIN Number: To hire employees and run payroll, you will need an EIN number or employee identification number. Begin this process ASAP, as sometimes the process can take a while.
- Food Service Licence: You will have to pass a safety inspection to obtain a food service license. With this license, you will receive a health rating, so make sure your restaurant is in tip-top shape before the inspection.
- Food Handling Licence: All employees, including yourself, if you plan to work in the restaurant, will need a food handling license.
- Liquor Licence: If you plan to serve alcohol, you will need to get a liquor license.
Make sure to include the cost associated with each license in your financial plan. They can add up, so you want to make sure the expense is accounted for. You don’t want any expensive surprises.
Hiring quality employees can be difficult but have patience. Make sure to outline job specifications in great detail to ensure a successful match. Be clear about your expectations for the position and only hire people who have applicable experience.
There are many different roles in a restaurant. Make a specific plan of who you need to hire. Possible positions include:
- Kitchen Staff: Chef, sous chef, prep cooks, line cooks, and dishwashers.
- Front of House Staff: Waiters, hosts, food runners, and bussers.
- Management Team: Managers for both front and back of house.
- Delivery Team: Food: packagers, delivery app manager, delivery driver.
Once you think you have everything in order, you may want to try out the system with a soft opening. First, make sure all of your equipment is ready to be used. Invite family and friends to come and enjoy a trial run of your restaurant. This will give you a chance to show off your hard work and see what areas you may need to improve on before opening.
Opening a restaurant is not easy, but with a lot of hard work and some highly organized planning, you will be able to create the restaurant of your dreams! Persevere in the face of challenge and ask for help when you need it. Hopefully, this in-depth overview is enough to get you started in achieving your restaurant dreams.