There were over half a million restaurants in America in 2018. While that number has taken a hit in 2020 given the widespread closures the industry has faced, hundreds of thousands of food businesses are still in operation.
As the economy begins to recover in 2021, you might be thinking your chance to launch a restaurant of your own could be better than ever given pent-up demand. Before you run out and lease a location, we’d advise that you learn the basics of how to open up a restaurant, something we’re going to be discussing in-depth throughout this post.
For simple, step-by-step guidance on how to make your restaurant dreams your reality, keep reading and discover how to enjoy a successful launch.
1. Start With Passion
The restaurant business is a hard one. The vast majority that open, fail. Fluctuating costs of simple items like milk could wreak havoc on your thin margins and will make it difficult to earn a living.
With that in mind, you must begin your how to open up a restaurant journey with passion. You’ll need a tremendous amount of it for cooking and business to survive the many downs you’ll face as an eatery owner.
2. Draft a Business Plan
Given a restaurant’s slim margins, there will be very little room for error when it comes to day-to-day operations. To make sure every detail is thought out so you know exactly what you need to do to be profitable, create a business plan.
Business plans are manifestos that outline everything from who your customer is, to how much your melamine dinnerware will cost. By itemizing every detail of your business, you can get a clear roadmap to success that will be necessary not only for your guidance but to secure funds if you’re looking for investors.
3. Create a Menu
Your restaurant is only as good as its menu. So, before you open up shop, you’ll want to work out what will be available for purchase when people sit down for breakfast, lunch, and/or dinner.
A word of caution as you go through these steps to opening a restaurant – keep your menu simple.
Simplicity keeps your expenses down, allows you to master a handful of dishes, keeps your kitchen less busy, and believe it or not, will make your customers happier. After all, nobody likes to be overwhelmed by endless choices.
4. Get Licenses
Depending on where you’re working, you’ll likely need licenses to operate. These licenses will include your restaurant license and if you’re serving alcohol, your liquor license.
Every state has a little bit of a different process when it comes to granting licensure to opening establishments. Speak with your local chamber of commerce representative to learn more about the specific steps you’ll need to take.
5. Pick Your Location With Care
Restaurants are foot traffic businesses. That means that to be successful, you’ll need to place your operation in an area where a lot of people are likely to walk past your window.
That might mean setting up shop on a busy city street. It could also mean opening up across the street from a large office building that creates a big lunch rush.
Very, very few restaurants can survive hidden away. Don’t assume your food will be so good that people will go out of the way to visit you. Make walking into your establishment the easiest choice your customer can make in a given day.
6. Discover Your Vendors
Where are you going to get your produce from? How is your dairy going to land in your fridge? Who will you call when your refrigerator stops cooling?
These are all answers you’ll need to come up with before you open up your doors.
Who your vendors will be varies on where you’re operating so start exploring local farmer’s markets, the internet, and asking around to see who you might be able to rely on for each of your business’ needs.
7. Source Funding
You may have already gone through this step by this point. If you haven’t though, chances are, before you can hire help you’ll need to source funding.
Funding can come from your bank account, retirement account, friends/family, the bank, or professional investors.
However you choose to get funding, make sure you understand the strings that come attached to the cash you’re borrowing. Also, be prepared to present your business plan to anyone that invests in your company so they have a good understanding of if your business will float and when they’ll get their money back.
8. Hire Help and Start Cooking
All that’s left to do to get your restaurant operational by this point is to hire quality help. The better your help is, the better your restaurant experience will be so take this step seriously.
Also, avoid over-hiring. Labor costs can put restaurants out of business so hire the minimum amount of labor you need to run a tight ship.
You Now Know How to Open up a Restaurant
Armed with the how to open up a restaurant guidance you’ve received, you should be able to start down the path of getting your eatery up and running. Once you do, remember your work isn’t done.
Marketing your establishment relentlessly, taking in feedback, and making tweaks where needed are all additional steps you’ll need to take seriously in order to keep your operation in business for the long haul.
If you’d like more details on our opening a restaurant checklist or tips on anything else related to food, explore the newest content on our blog.