OPENING A RESTAURANT IS TOUGH
Opening a restaurant is all about passion. You won’t find anybody in the industry who opened their own restaurant just because they wanted to make money yet they didn’t want anything to do with good food. But passion isn’t the only thing needed to open a restaurant. It is really tough. Especially in today’s market.
According to one study by the Ohio State University, out of all the restaurants that open, 26% fail in their very first year. Out of the remaining restaurants, 80% fail in the first five years. These statistics are high, to say the least. Why is it that the failure ratio in the restaurant business is so high? Well, there are a number of reasons. These include, but are not limited to, inexperience, high cost, poor planning, poor customer service, or not enough funding.
SAY NO TO THE NAYSAYERS
There are a lot of naysayers in the industry that will stop you from pursuing your dreams and making it big in the industry. If you’ve done your research, you must have come across these people. Even after reading their thoughts and opinions, you still want to make your food dreams a reality, then you’ve come to the right place. There are a number of ways of entering the industry in a small way. Here’s what you can do to make sure that you enter the restaurant business industry and stay in it.
WHAT TO DO BEFORE STARTING A RESTAURANT
No matter which industry you belong to or how much practice you’ve done, there’s nothing that can prepare you for the restaurant industry. You can read all the literature you can get your hands on, you can ask anyone that’ll talk to you, there are some things that you will only learn when you step into the industry. Nonetheless, here are a few things to get you started on your path to achieving your dream.
COME UP WITH A KILLER CONCEPT
If you are a restaurateur then you know that there is a whole variety of food that foodies love. The first thing you should do, before doing anything else, is to determine what you are going to offer. What is it that is going to make you unique? What is it that will help you stand out?
TRY YOUR HAND AT SMALLER FOOD VENTURES
If you’ve done your homework then you know that opening a new restaurant, even on a small scale, can cost you anything from $50,000-$75,000. The higher you want to go, the fancier you want your place to be and the cost will keep on increasing. There’s no ceiling figure. You can go as high as you want. But it all depends on your funding. If you don’t have that kind of funds at your disposal, and many people don’t, then it is best to try your hand at smaller food ventures before going into the bigger market.
Food trucks are less costly and even less scary than a restaurant. It is the perfect way for you to test your skills and for your customers to taste your products.
The beauty of a food truck is that it will decrease your initial overhead exponentially. It won’t need the kind of initial investments that a restaurant needs. You don’t need to hire a whole lot of servers and chefs. There’s no electricity bill or rent to pay. All the marketing that you’re going to need is readily available on different social media platforms.
Food trucks are still a lot of work, but not as much as a restaurant. For a fraction of a restaurant’s capital, you can easily be on your way to becoming the next big chef.
A catering business can easily be called a mini-restaurant business. It has all the same ingredients as a restaurant like a menu planning and pricing, budgeting, food preparation, customer service, insurance, marketing, and bookkeeping. The only difference is that it’s on a much smaller scale. After doing catering for a couple of months, you’ll be much more prepared to take the plunge into the market.
PLANNING AND PAPERWORK
Once you’ve done all the above-mentioned things, and you still want to go ahead with your initial plan, then you’re going to need funding. Lots of it. There’s a whole lot of options you can go through. But before you do any of that, you need to make a plan. Something that you can present in your meetings. Make sure that your plan includes your concept, your theme, your target audience, the startup cost, and the projected sales. Also, include your past experience. If you’ve tried your hand at a food truck or a catering business, it will really come in handy.
FINDING A LOCATION
One of the main factors in a restaurant succeeding or failing is the location. Don’t be hasty when looking at different locations. Make sure that you consider all the factors like visibility, zoning ordinances, rent, and the competition. This information will be added to your business plan and give it more weight. It will also help you plan a budget as you will now have an idea about the seating capacity, kitchen size, and how much stuff you’re going to need to cater to an audience of that size. You know that one of the major factors in any restaurant is its look. Selecting the perfect location and merging it with your concept will give you what kind of furniture you’re going to need. Get the best restaurant furniture USA has seen and you’ll have a place people will want to visit again and again. A good restaurant experience will also get you much-needed recommendations and referrals.
Well, you’ve got your paperwork ready. You’ve tried your hand at preparing food and serving it at different locations to different audiences at different paces. You’ve got a foolproof concept and you’ve done all the homework as to the financial and other requirements. Now comes the last part: Getting Financing for your dream.
There are a number of ways you can finance your idea and turn it into a reality. You can find yourself an “angel investor”, you can go to a bank for the investment, you can look for a private investor, you can go for crowdfunding, or you can even talk to the landlord of your selected real estate. They may pro-rate rent in exchange for shares in your restaurant.
There you go. Your own list of things to do before entering the restaurant business. Take it, own it, and make it work for you. Be patient, be persistent, be your own brand.