Thinking of Opening A Restaurant?
There’s a lot more to owning a restaurant than using your culinary academy skills to serve up some delicious food. While it can be the perfect way to bring a vision you’ve had for years to life, there’s a lot of work that goes into it that isn’t so glamorous. There are plenty of steps you have to take before cutting the ribbon of your brand new restaurant.
Do your research
According to Bloomberg Business, approximately 60 percent of restaurants fail within their three years in business. With failure rates like that, you want to make sure that you do as much market research as possible before laying down a brand new business. Take note of the following factors before you even think about opening a restaurant:
- Is there a need in the area?
- What would the competition be like?
- What are the licensing policies in the area?
Have a concept
Once you’ve determined an area’s need, you can begin working on a restaurant concept. If there are three sports bars on the block that you’re eyeing, you might want to try something different. However, you don’t want to stray too far, either. You don’t want to open an upscale brunch restaurant in an area full of more affordable breakfast diners. If you’re set on a specific area, examine the needs of the community and design your concept from there. If you’re set on a specific type of restaurant, find an area where it would work well.
Scope out a location
Maybe you realized your dreams of owning a restaurant when a business in your hometown closed, leaving an open building. If that’s the case, congratulations, you already found a location. If you have your own idea all worked out, but need a place to launch your plan, then get looking. Pay attention to the area. Is there decent parking? Are there other businesses around that would draw traffic? Are there other restaurants in the area similar to your concept? The answers to these questions could make or break your chances of success.
Get a team together
You may be an awesome chef, but it takes a lot more than culinary skills to get a business off the ground. If you’re looking to partner with a friend to open the business, be sure to get legal paperwork drawn up to avoid conflicts in the future. These steps may seem unnecessary at the moment, but it’s better to be safe than sorry.
The whole money thing
Obviously, money is a huge factor when it comes to opening a business. It costs a lot of money to open an restaurant and even more to maintain it. According to Restaurant Owner, it costs about $500,000 on average to start a restaurant, without land. Keep in mind that you have to pay your staff, buy the food, pay taxes, renovate the space and obtain licenses, all before making a profit. Put together a budget and try to stay below it.