How to open a restaurant?

Many aspiring entrepreneurs dream of owning and running a restaurant. This dream may have been put on hold when the pandemic caused restaurants to stop indoor dining and permanently shut down their doors. Restaurant owners are still feeling the effects of the coronavirus as they struggle to recover. The foodservice industry has adopted new trends to address the current crisis. It also has diversified its revenue streams to deal with the problem. We believe restaurant ownership is possible, so we have created a checklist for restaurant startups.

How to Start a Restaurant

It takes careful planning to open a restaurant. However, it is easier to manage if you break down the process into smaller steps. We have an 11-step guide that will help you open a restaurant.

Select a restaurant concept and brand

You’ve likely thought a lot about the restaurant idea you want to open. The fun part of restaurant planning is choosing the business concept. This allows you to let your imagination run wild. The type of restaurant you wish to open and the cuisine and service style that you will use should be included in your concept. Your concept should also influence the interior design of your restaurant. These are just a few examples of restaurant concepts that will inspire your imagination.

  • Ghost kitchen concept offering vegan comfort food delivered only
  • A fast-casual restaurant that specializes in build-yourself ramen bowls
  • Fine dining restaurant offering a traditional French cuisine

Your restaurant branding is more specific. It can be described as how you communicate your mission and identity to others. Your restaurant’s name, logo, menu design and merchandise must all portray a consistent image of your brand. Your brand identity should influence how you advertise.

Demographic Target

To help you shape your idea, it is a good idea to consider the area’s demographics if you have already chosen a location for your business. You must first choose a location that supports your concept.

Make Your Menu

The next creative step is to create your restaurant’s menu. It should be fun for all food lovers to choose which menu items they will feature. However, it would be best if you made the right choices. The type of equipment and skills that you need will depend on the menu. It also determines the kind of audience you want to attract. If you want to create a dessert menu with delicate French pastries and cakes, you need a pastry chef. You’ll need proofers and dough mixers if pizza is your favourite cuisine.

Consider your target audience. You can get a great deal by leasing space in college towns. Your restaurant menu should cater to college-age customers. If you are determined to make your dream a reality, you must choose a location that can afford a more expensive menu. To create a profitable and attractive menu, you can use our guide for menu design or our resources to price a menu.

Create a restaurant business plan

A solid business plan is essential for any business venture, including a restaurant. This is the most difficult step for those who are not familiar with how business plans work and what they look like. Business plans include sections that detail all aspects of your new venture, including your restaurant’s concept and financials. This plan will help you outline your business and present it to potential investors. The restaurant business plan proves your venture’s success when you apply for restaurant loans.

Here are the main components of a restaurant plan.

  1. Executive Summary This section is the beginning of your business plan. However, it’s a good idea to make it the last. It’ll serve as a summary and overview of all the sections you have completed.
  2. Company Overview and description – This section allows you to provide a more comprehensive overview of your company than the executive Summary.
  3. Menu and Concept – This section describes all details about your restaurant’s menu and concept.
  4. Management and Ownership Scheme – Provide an overview of your management and ownership structures. Charts are a great visual aid.
  5. Staffing and Employees It is easy to underestimate how many staff you will need. You’ll be able to see a realistic picture of the number of employees you will need to run your business by writing it down.
  6. Competitor Analysis: This business plan section needs to be done with care. An analysis of the Competition and demographics for your chosen area will be required.
  7. Advertising Strategies and Marketing Strategies. Use the marketing analysis you did in the previous step to select the best marketing strategies.
  8. Summary and Financial Projection This section is crucial for getting funding for your restaurant. It can be used to generate a sales forecast and break-even analysis.

Get Restaurant Funding

Funding is the next step in opening a restaurant. Many of us don’t have the capital to pay for the costs of opening a restaurant. If you can make your restaurant dream a reality, you must secure funding from outside sources.

Start by estimating the total cost of opening a restaurant and the daily operating costs. This information can be used to forecast your restaurant’s total costs for the next year and create a budget.

Now that you have your restaurant budget in hand, you can compare it to the capital you have to determine how much you will require. Be sure to include costs for equipment, licenses, building repairs, as well as salaries. These are some ways you can secure funding for your restaurant.

  • The Traditional Commercial Loan, This type of loan can be obtained directly from a bank. A traditional commercial loan will usually offer lower interest rates and more capital. You will need collateral and a good credit score.
  • Business Line of Credit– You can be approved for a maximum credit limit, similar to a credit card. However, interest accumulates only as you use the money. Lending standards are stricter, and you might not be able to borrow as much as you would with other types.
  • Small Business Loan. While you can obtain a small business loan from any bank, many banks partner with the U.S. Small Business Administration. A small business loan can be obtained even if you have borderline credit. The SBA guidelines were created to protect both the lender and small business owners. It may take time to approve your loan application because you need collateral.
  • Investors — Reach out to your networks or sign up on a site like AngelList to locate your restaurant’s investors.
  • Crowdfunding Sites such as FoodStart, Indigogo and GoFundMe can be great places to raise funds to pay startup costs.

You can find more information in our restaurant financing and loans guide.

Select a location and lease a commercial space

When selecting a new location for your restaurant, these are the most important factors:

  • Accessibility: Choose a location with good visibility and receive a lot of foot and vehicle traffic. It would help if you considered parking availability and accessibility for pedestrians and cars.
  • Demographics: Your area’s demographics should be used to determine the target market for your restaurant.
  • Labor Prices – The labour cost will vary depending upon where you live. To attract top-quality employees, you will need to pay more in areas with higher living costs.
  • Local Competition You can learn a lot from looking at other restaurants in your neighbourhood. It is important to find a place where similar restaurants have been successful but not in an overcrowded area with restaurants that are directly competing with your idea.

We recommend leasing when choosing a space. This allows you to make business decisions later on or expand your current business.

Restaurant Permits and Licences

You will need many federal, state and local permits and licenses to open a restaurant. To ensure you do not miss any steps, it is a good idea to seek legal advice when applying for restaurant permits or licenses. These licenses are the most crucial.

  • Business License, All restaurants in the US require a business licence. Each state will have its requirements regarding the type of license required, cost, and renewal frequency.
  • Employee Identification Number Apply for an Employee Identification Number (EIN), as it can take a while to be approved. To hire employees or set up payroll, you will need an EIN.
  • Foodservice Licence – To get a license for your restaurant, you will need to pass inspections that show your business meets all food safety regulations.
  • Liquor license – To serve alcohol in your restaurant, you need a liquor licence. Although alcohol can increase your sales, the process of getting a liquor license can be costly and time-consuming.

Create Your Layout and Space

Your front-of-house space and your back-of-the-house space are both important components in designing your restaurant’s layout. Each space is different. You can get assistance from an industry expert to design a layout that suits your needs.

These are the main considerations when designing a dining room layout:

  • Seating Capacity Local regulations will determine your dining room’s seating capacity. Based on the space size and number of exits, you must comply with the square footage requirements per customer.
  • Dining Room Furniture Choose restaurant seating that matches your design. When choosing the shape and style of your restaurant furniture, consider how many people you can seat and what comfort level you prefer.
  • Ambience & Decor – Enhance the ambience of your restaurant by using decor and lighting.
  • Cleaning – Wall fixtures and flooring should be easy to clean and disinfect. Carpeting is not the best option for dining rooms because it absorbs smells and spills. Drapes and window treatments made of fabric absorb odours and can be difficult to clean.

Consider the flow of the service when designing your kitchen layout. Make sure you have enough space to accommodate the following tasks:

  • Warewashing Servers with dirty dishes should have easy access to the ware washing area. This area will contain dish machines, drying racks, and compartment sinks.
  • Cold Storage – Dry and cold storage areas should not be far from the receiving area to allow quick shipment. These areas will need shelving and organization.
  • Food Preparation This is where the kitchen staff will perform all food preparation tasks. Space is needed for prep tools and work surfaces.
  • Meal cooking – This area is used for the majority of cooking tasks. Heavy equipment such as range tops, deep frying pans and flat top grills will need to be accommodated.
  • Service– The service area should be located next to the kitchen area to ensure that ready-to-eat meals can be quickly passed on to servers. Heat lamps keep meals warm until they are ready to be picked up.

Locate a Food and Equipment Supplier

Your kitchen must be equipped with the correct equipment before opening your restaurant. Every restaurant requires certain equipment, such as refrigeration units and cooking gear. Depending on the type of food you serve, you might need special equipment, such as pizza ovens or pasta cooks. Your kitchen’s size and layout will impact your options, such as whether you want narrow-depth equipment or double stack units to save space.

There are many advantages to ordering your restaurant equipment online. You can shop online and compare prices while managing the many other tasks of opening a restaurant. It would be best to look for an online supplier who specializes in commercial equipment at wholesale prices. They also offer fast shipping. Renting equipment can help you save money and make it possible to invest in other items.

Also, you will need to locate a supplier for food, disposables and other items that you’ll be ordering regularly. You can save money by ordering bulk supplies from a supplier who offers member discounts and free shipping. You should also look for additional benefits such as the Webstaurant Reward(r) Visa Business Card, which gives you rewards for every WebstaurantStore order.

Hiring the right staff

You have the chance to create a great work environment right from the beginning by hiring staff for your restaurant. When considering your staff’s work/life balance, it is crucial to think about employee benefits, training programs, and incentives. These factors will make your employee retention more successful. Hire your management team to help you achieve your goals and carry out your mission.

You will need to make a list of positions that you will need to fill to run your restaurant on a daily schedule. It would be best to consider how many hours you will be open each day and how many shifts your staff will work for you at the front and back of the house.

You will need to have different staff requirements depending on your restaurant’s unique needs, but these are the most common.

  • Management Team General Manager, Kitchen Manager, Front-of-house Manager
  • Kitchen Staff Head chef, sous-chefs, prep cooks and line cooks, as well as dishwashers
  • Front-of-House Staff – Servers, hosts, food runners, bussers
  • Bar Staff – Bartenders, barbacks, cocktail servers

It is possible also to hire PR specialists, marketing experts, accountants, and other staff.

Advertise Your Restaurant

You must get the word out about your new restaurant and draw in potential customers if you want to open it. Advertising gives basic information about your restaurant to potential customers, so they know where you are and what kind of cuisine you offer. Advertising should create excitement about your brand. Here are some marketing tips for your restaurant.

  • Create a Website Your restaurant web page must be simple to navigate and reflect your brand. You should include basic information about your restaurant, including its address, phone number and hours. You can hire a professional website designer, but you can also make it yourself using user-friendly web hosting platforms like Wix, Squarespace or WordPress.
  • Register with Google My Business, Yelp and TripAdvisor to make it easier for potential customers to find information about your restaurant. You can also get reviews from your guests after they visit, which will increase your authority and appeal, particularly if you have positive feedback and a high rating.
  • Use Social Media Today, and restaurants must have a social network. Create a Facebook, Instagram, and Twitter account to share news, photos, and other information about your restaurant. If your target audience uses TikTok regularly, TikTok may be a good social media option.
  • Promotions for New Guests – A promotion for guests who are first. Customers can get a free drink, dessert or discount on their first order. This is a great way to draw them in.
  • Hosting a Grand Opening. – Get a buzz going at your new restaurant by hosting a grand opening. You can also attract attention with other special events such as wine tastings, live entertainment, and cooking classes.

Host a soft opening

It’s a common saying that practice makes perfect. Restaurant openings are no different. You can use a Soft Opening as a training exercise to prepare for your real grand opening. Your staff and friends are usually invited to your soft opening. This allows you to iron out any problems in your service. These are some popular soft-opening ideas:

  • Test Menu – Offers a sample menu that offers a small number of choices. This reduces stress for new staff members and encourages customers to return to the full menu.
  • Limited Schedule Consider operating on a restricted schedule the first few days you are open.
  • Sneak Peek Event: Host a “sneak peak” happy hour featuring select menu items and signature cocktails.
  • Friends & Family Night Invite your friends and family to your soft-closing for a stress-free, fun way to get ready for the grand opening.
  • Neighboring Homes and Business – Get local support and community pride by inviting neighbouring homes and businesses to a soft opening.


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