How To Start A Restaurant

How To Start A Restaurant - Background Info:

Shifting demographics and changing lifestyles are driving the surge in food-service businesses. Busy consumers don't have the time or inclination to cook. They want the flavor of fresh bread without the hassle of baking.

They want tasty, nutritious meals without dishes to wash. In fact, the rise in popularity of to-go operations underscores some clear trends in the food-service industry.

More and more singles, working parents and elderly people are demanding greater convenience when it comes to buying their meals.

Though the future looks bright for the food-service industry overall, there are no guarantees in this business. Even the most successful operators will tell you this isn't a "get rich quick" industry. It's more like a "work hard and make a living" industry.
A hard reality is that many restaurants fail during their first year, frequently due to a lack of planning. But that doesn't mean your food-service business has to be an extremely complex operation.

In order to open a successful restaurant business, you need to have stellar business skills.

How To Start A Restaurant - Tasks And Skills Needed:

Business Specific Tasks:

If you are planning to do all the business tasks or hiring or subcontracting tasks, here's a list of tasks that need to be attended to when it comes to the business side of running a restaurant business:

Bookkeeping

Accounting

Inventory management

General office

Industry Specific Tasks:

Same as above if you plan to do everything yourself or get help, here are some of the tasks necessary to operate a restaurant business:

Oversee all aspects of your restaurant from cooking to serving to hosting.

Step in and cover any position if you need to.

Delegate responsibility and assign jobs.

Provide a comfortable dining experience for customers

How To Start A Restaurant - Approximate Daily Hours Needed:

Restaurant

General Hours of Operation: - When your business is open - Depending on your location, a restaurant is normally open from noon to close; however, some are open 24 hours.

Hours Needed to Prepare - Before Opening and After Hours Activities - Cleaning, trash disposal, menu/pre-cooking, care of the parking lot (clean), ordering of supplies and food, storing of supplies and food.

Number of Employees Needed To Run This Business:

Minimum Number of Employees -During the Start Up Phase: You can start this business yourself on a full-time basis.

Number of Employees - Once Your Business is Up and Running Successfully:

Website maintenance

Record/Bookkeeping

General office

Customer Service

Wait staff

Greeters

Bus people

Cooks

Bartenders

Skill Requirements for This Business:

Ability to create great food

Ability to decorate the restaurant to make customers comfortable

General upkeep of the building

Staying in regulation through your state and federal requirements

Licenses:

Licensing is an area in which you need to make sure you fully comply. You need a business license, a food license or permit, and a liquor license if you want to serve alcohol. You also need to pass inspections by fire, safety, and health commissions. Contact your state to get more information on the specifics.

Approximate Minimum Start up Cost:

Bare essential: - The financial investment for starting your own restaurant business is high. You can get funding from banks, private investors, your own savings, and the Small Business Program. Starting from scratch is very expensive. You need to rent or purchase a building with adequate facilities. You need to set up equipment, which will cost tens of thousands of dollars, and you need to make sure the building is ready for customers.

You could buy a franchise, but this is also expensive. A McDonald's franchise for example costs about $175,000. An Applebee's franchise costs $1 million. Maybe the least expensive route to take is to purchase an existing restaurant whose owners want to sell the building and all the equipment.

Opening a restaurant business is very expensive, but it can also be very rewarding. If you are committed to opening your own restaurant, look at existing restaurants for sale and used equipment. Also, start researching different funding options. It will take a lot of hard work and dedication.

Minimal exposure - There are several ways to advertise for free including getting your local newspapers to cover your business, putting out flyers, and then pay more for mailers and television and radio advertising.

Necessary Equipment to Run this Business:

Necessary Start-Up Equipment & Supplies:

Computer

Printer

Cell phone

Website

Refrigerators

Commercial frying equipments

Ovens

Food prep supplies

Preparation tables

Beverage and ice machines

Mixers

Dishes (for cooking and serving)

Utensils (for cooking and serving)

Tables and chairs

Menus

Food supplies

Bar supplies

Supplementary Equipment: - Equipment or helpful products that you can acquire to once your business is off and running:

Additional stoves, ovens, and cooling units

Uniforms

Monthly Expenses To Consider:

Wages
Phone/cell phone
Internet access
Permits
Advertising/Marketing
Electricity
Water

Special Requirements and Considerations For This Business:

Find out all you can about the trends in the industry. Know your competition, in particular, their strengths and weaknesses. This will help you identify your competitive advantage. In other words, this will help you figure out what you can give your customers that they're not getting from the other businesses. And keep from emulating the competition's strategy. Instead, make the most of your own advantage points.

Plan your menu early in the game. Kitchen layout and equipment purchases depend on it. Reduce your equipment costs either by purchasing used equipment or leasing new.

Keep the kitchen layout focused on efficient, safe food preparation. Ensure that there is sufficient light and ventilation, as well as enough space so that cooks, servers and dishwashers are not bumping into one another at the busiest times

Pros And Cons of Opening A Restaurant:

The Pros of Running a Restaurant Business:

Potential for big income

A lot of choices for specialization

Great market

Big labor market

The Cons of Running a Restaurant Business:

Fierce competition

Competitors with lower prices

Market saturated with big name restaurants

Long hours

Hard work

High start up costs

High overhead

A lot of regulations and laws to abide by

Type of Customers You Need to Attract:

No single food-service operation has universal appeal. This is a fact that many newer entrepreneurs have trouble accepting, but the reality is that you will never capture 100 percent of the market. When you try to please everyone, you end up pleasing no one. So focus on the 5 or 10 percent of the market that you can get, and forget about the rest.

Most people like to eat and you should do research to determine the types of food that are popular in your area. Many restaurants attract the business sector with "Happy Hour" fare and/or ability to pick up orders.

Restaurant Business Statistics:

Americans are eating out in record numbers. The National Restaurant Association reports that restaurant sales reached about $537 billion in 2007. With 935,000 restaurants and food service outlets and 12.8 million employees, this industry is the country's number one employer. It is also a very difficult business in which to achieve success. Do you have what it takes to open your own restaurant business?

Revenue:

According to the National Restaurant Association, the restaurant industry sales are expected to reach a record $537 billion in 2007 and there are approximately 935,000 restaurant-and-food service outlets. With 12.8 million employees, the industry is the largest employer. Owning a restaurant can be very rewarding, but don't think you can open one and hire a manager and then forget about it. You need to be on top of training your manager and employees so that you don't lose your profits and/or your business. You also need to keep up with federal, state and local regulations.

Restaurant Business Resources:

Industry-Specific Websites:

Allfoodbusiness.com

Courses:

Education Portal

Equipment and Supplies:

The Webstaurant Store

KaTom

InstaWares

Franchises:

Restaurant Franchise Directory

Associations:

American Bakers Association

National Restaurant Association

Best Independent Restaurants Association

Books:

How To Start a Restaurant Guide

Start Your Own Restaurant Business

How To Become A Successful Restaurant Owner

Other:

Comprehensive guide to launching your own food establishment

Before You Open a Restaurant

Start a Restaurant

Businesses To Related to a Restaurant:

Bakery

Hospitality industries

Vending