Opening a new restaurant or a bar is a dream come true for many entrepreneurs, but a restaurant
business is one of the most capital intensive enterprises you can own. All of
those industrial ovens, stainless steel sinks and refrigeration equipment cost
money, not to mention the cost of the tables, chairs and other furniture.
All that expense means that you will probably need to borrow money to get the
restaurant up and running, and in order to attract the capital you will need,
you need a solid financial plan in place. When you seek out a loan, whether
from a government agency like the Small Business Administration or from your
local bank, you need to provide a solid business plan for those entities to
review. Creating a business plan for your proposed new restaurant is not as
hard as you might think, but it is important to follow the proper format and
include as much information as you can.
In order to write a business plan, you need to take a look at each section, and
how a business plan template can help you make the most of the data you have
gathered. Business planning software can help as well, since it takes a lot of the
drudgery and guesswork out of the financial rations that make up your
restaurant business plan.
The executive summary portion of the restaurant business plan is critically
important, and you need to pay careful attention to this part of the
plan. The executive summary is where you will list all of your previous
restaurant experience, as well as any management and staffing skills you may
possess. The executive summary serves a couple of important purposes, including
showcasing your strengths as a business owner and detailing how you plan to go
about starting a restaurant that will quickly become the premier destination in
In the business overview section of the restaurant business plan you actually
get down to the nuts and bolts of how the business will operate. This section
will include such vital details as where the restaurant will be located, what
hours it will keep and what type of cuisine it will specialize in. It is
important for the business overview section to provide a compelling argument
for why starting a restaurant of the type you propose will be a successful
Products and Services
Opening a restaurant or a bar means providing both products, namely the signature dishes
you will create, and services, including the attention of your wait staff and
the ambiance and elegance your restaurant creates. The products and services
section of the restaurant business plan gives you a chance to detail what your
restaurant will offer, and what will set your new restaurant apart from the
Chances are there are already plenty of restaurants in town, and this section of
the plan is designed to convince skeptical lenders and would-be
investors why your business plan to open a restaurant is a good one. In this part, you will detail the marketing strategy you will use to
differentiate the new restaurant you open from others in the area. This section
can also include details of the market research you have done, including
efforts to identify and cater to underserved segments of the market.
Management and Staffing
One of the biggest hurdles faced by any new restaurant is finding qualified
staff members at an affordable price. The restaurant industry has a notoriously
high turnover rate, and it is important for the business plan you
create to show that you have given plenty of thought to overcoming this
challenge. The management and staffing section of your plan should
lay out in detail your strategy for attracting and retaining talent, both in
the kitchen and in the front of the house. This section should also detail the
experience and core competencies of the management team, since those
individuals are just as critical to the success of the enterprise.
Starting a restaurant is a complicated and time consuming endeavor, and the
restaurant business plan will need to include firm details on how, when and
where the restaurant is to be opened. The implementation plan portion of the
business plan should include a detailed timeline for starting the restaurant,
from renting or buying the space and obtaining the furnishings to stocking the
kitchen and hiring the personnel who will run the operation.
Opening a restaurant requires a lot of capital investment, including purchasing
the freezers used to store food at the proper temperature, the stainless steel
sinks and dishwashers and the tables and chairs needed to make diners feel at
home. The investment section of the restaurant business plan is where you will
lay out the details about the items your new restaurant will need to get off
the ground, as well as the ongoing investments that will be needed to keep it
up and running.
The funding section of the business plan will include details on the
funding it will take to get the new restaurant off the ground. This section is
very important, since lenders and equity investors will need to see that you have done
a thorough analysis that includes all the equipment and supplies you will need.
Solid financial projections and financial ratios should be part of any restaurant business plan. In
this section of the plan you will lay out the revenue you expect the restaurant
to generate, both during its initial startup phase and during its normal
operation. A lot of thought and care needs to go into this section, since
lenders will want to see that you are using realistic figures and not pie in
the sky projections.
There are many risks associated with starting a restaurant, and you need to
address those risks frankly in the business plan. All businesses have risks,
but restaurants have a number of risks that are specific to their line of
business. Some of these risks include a bad report from the health inspector, a
negative review from a respected food critic or the sudden loss of a top chef
to a competitor. Addressing the possible risks of the restaurant business is a
critical part of your restaurant business plan.
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