5 Things to Consider Before Writing a Restaurant Business Plan
Restaurant business offers profit margins starting at a 20 percent rate. On average, eateries break even in the course of one-and-half, two years and you start making good money afterward. Well, this fairytale truly occurs only if everything goes according to plan. And if you want that plan to be sound, make sure to have some solid preparation before crafting it. Here’s a look at five crucial steps a restaurant founder should cover before writing a working business plan.
Take your time to decide whether you want to set up your eatery from scratch or purchase a ready-made franchise to receive some guaranteed profit. The latter works well for those who are looking for the fine balance between giving a personal touch to business operations and having the security, knowledge, marketing, and blueprints of an experienced franchisor. You won’t even need a restaurant business plan in such a case, just get in touch with the franchise guys.
If you are driven by the idea of embodying your own vision of the restaurant, a franchise won’t be the solution. Setting up an authentic place involves taking risks, a good deal of patience, and passion combined with flawless preparation, both before and during actual business planning.
Start with a team
Regardless of your level of engagement into operations, it is inevitable that many restaurnats will need to recruit an executive manager and chef as soon as possible. These people know how to open a restaurant tailored to your vision. They will help you select the cuisine, shape the concept, procure appropriate equipment, and develop technological blueprints.
I recommend starting the headhunting process as soon as you are ready to move forward with your idea. An executive experienced in opening restaurants holds paramount knowledge in selecting the location and establishment process. While managers take over the administrative work, chefs will consult you on the concept and personnel issues. Make sure you have these two behind your back before you start converting ideas into a definite restaurant form.
Craft the menu
Avoid committing this common rookie mistake: developing the menu at the stage of a completed restaurant interior. Stop thinking about designs, equipment, and any construction work unless you have your menu done. There are plenty of technical nuances depending on selected cuisine, starting from kitchen gear and finishing with the concept of your place. Yes, 99 percent of restaurants define their service and art direction based on the sort of food they provide.
Make sure you take a strategic approach to the menu. A lot of eateries fail because they focus entirely on the fleeting and fluctuating food market tendencies. Another popular mistake of inexperienced founders is betting on the cuisine they personally know and understand. Please, leave it to your chef.
Concept and categorization
Any business venture without a clear positioning will almost certainly go unnoticed in a crowd of competitors. As applied to restaurants, positioning is your concept—a combination of ideas, design, space, and food that will enable you to stand and capture clients. This is a vital part of the business plan structure.
To fortify and complete the concept, define the category you want to operate in, be it fine dining, casual dining, fast casual, fast food or family dining. You may also want to open a bar, café or some sort of fusion of these options. Category is generally pre-defined by the concept and lets you understand the level of prices and the service quality your eatery requires.
Coming up with a name during the last stage is as dangerous as lagging on the menu. Superficiality will be quite vivid, and even gifted advertisers will have a hard time promoting your brand.
Great naming should relate to the concept and category of your restaurant and be fueled by a strong story. Storytelling will always be the backbone of marketing and PR campaigns and will determine the level of excitement and longevity of your client base. So, do your best.
Always remember that circumstances tend to mess everything up. Business plan calculations may exceed the expectations, rented premises may fail to fit the initial concept. Just make sure you add some flexibility to your intents, so you would be ready for adjustments during business planning. Good luck!
Jeff Blaylock is a certified specialist in the sphere of hospitality, restaurant business consultant and expert writer at Essayontime. Following a successful career as a manager of top restaurant chains, Jeff has started to apply his expertise to local businesses development. He is passionate about the culture of eating out and constantly shares the knowledge through his reviews, writings and lectures.