Every successful restaurant should start with a business plan. Restaurant business plan examples provide roadmaps for entrepreneurs as they bring their ideas to life.
In this guide, we’ll take you step-by-step as we go over how to create a business plan for your very own restaurant. Along the way, we’ll hand out a few helpful tips and examples. But, before we dive into the how, let’s explore why you need a business plan to succeed in the food business.
Roughly 60% of all restaurants fail in the first year. Half of the survivors will shutter by year five. The number-one difference between successful and unsuccessful restaurants is planning.
A fine-dining restaurant that might succeed in a crowded city center could dry up in a sleepy suburb. A slick, fast restaurant geared to the business lunch crowd probably won’t survive in a small town.
The reality is that the restaurant industry is an incredibly tough space to compete in. Successful startups will understand their customer demographics, have a well-researched marketing plan, and know what sales figures they need to hit to become profitable.
Here are the benefits of having a restaurant business plan.
When it comes to restaurant business plans, a small amount of time invested upfront will pay off big time down the road. So many details go into running a successful business. Sitting down and working through some of the problems you’re likely to meet early in the game will save you both time and money.
For example, taking several hours to look up vendors in your area can help you identify a cost-effective supplier with a strong reputation for reliability and quality service. By contrast, an unscrupulous contractor might cost you hundreds or even thousands of dollars in lost sales through delayed shipments.
Researching successful restaurants in your niche can help you select the right kitchen equipment the first time around. Understanding space requirements can help you decide how much square footage you’ll need, potentially saving you from an expensive lease.
Save money by researching other important factors like your business’s hours of operation, point-of-sale (POS) system, and the size of your management team. This will help you make the right decisions the first time around.
Conduct an industry analysis to better understand the market conditions that you’re working in. While you’re putting together your restaurant business plan, you’ll have the opportunity to learn important information that impacts your business.
For example, you might learn that another business with a similar theme is opening up across the street from you. You could use this information to differentiate your restaurant, so you’re not in direct competition with this new restaurant.
Potential investors expect to see a detailed pro forma restaurant business plan before making an investment. If you plan on getting a commercial bank loan, the loan officer will likely require a detailed and carefully researched business plan. As you move forward, keep in mind that good business plans double as effective sales pitches.
With the below restaurant business plan example, you’ll know which sections you should include. You copy and paste each section into a Word or Google Document to use as your outline.
Keep in mind that if you’re looking for investors, you’ll want to have your business plan professionally printed and bound. You may even want to commission a designer to help you lay it out and add visual elements, like your brand colors or company logo, to give your final business plan some polish.
Your executive summary provides readers with a high-level overview of what’s to come. This section of the document should balance organizational detail with excitement.
Remember, banks and potential investors will see your business plan. You’ll want to grab their attention.
This section of your business plan contains your restaurant concept. Include key details, such as your restaurant name, business structure, mission statement, target market, and goals.
Outline the type of restaurant you want to open. Will it be fast food, fast casual, fine dining, or something different?
Don’t be afraid to dive into the nitty-gritty here. When it comes to marketing plans, the more detailed the better. Identify your budget, marketing channels, and key performance indicators (KPIs).
Think strategically about your restaurant brand. A fast-casual restaurant targeting a younger demographic might emphasize social media marketing, while a fine dining establishment will probably spend more on traditional ad or PR strategies.
As a business owner, it’s important that you define the roles in your new restaurant to maintain order and efficiency. Write down who reports to who to avoid hard conversations down the road.
This will also help you think through which restaurant positions you’ll need to hire and budget for your labor costs.
You’ll want to plan out both your menu items and your menu design.
Be sure to decide what kinds of food and which meals you’ll be serving. Will you be open for breakfast, lunch, and dinner? If so, what menu items will you offer for each meal service? Will you have the same menu items all year, or will you change your offerings seasonally?
When creating your sample menu, consider your pricing strategy and how your menu will help you stand out from the competition. Does your restaurant trend minimalist or maximalist? Can you put a twist on your menu? Take a look at the competition. You may find a gap in the market.
Deciding on your menu design is an important detail that will help your new business succeed in a crowded marketplace. A professionally formatted menu will enhance your restaurant’s aesthetic and contribute meaningfully to the overall atmosphere.
You will also need to consider what kinds of menus you’ll need. For example, do you need printed menus that will be given to customers at their tables, or will you be using a kiosk-based digital menu, signage above an ordering counter, a chalkboard outside a food truck, or printed takeout menus?
At this stage, you’ll want to lay out what your local market looks like. Examine the competition, spot opportunities, and explain why your restaurant will succeed.
One useful tip is to find a key problem that your restaurant will solve. You can also do a SWOT analysis, which identifies strengths, weaknesses, opportunities, and threats.
You might want to hire an accountant to help with this one. Getting all of your numbers together in one place is necessary to understand what you need to do to turn a profit.
This section will usually contain loss statements, cash flow statements, a break-even analysis, and your restaurant’s balance sheet. Start-ups might not have all of these documents. It will depend on what stage you’re at with your new business.
Enhance your business plan with smart software solutions that can save you money over the long haul. Devices such as KioskBuddy’s self-serve kiosks or take-out delivery apps will help you boost productivity, cut labor costs, and expand your customer base.
Embracing cost-effective technology might also help you get an investment or loan for your startup. Investors and banks want to see that you’re paying attention to the bottom line.
Adopting self-serve kiosks early will also put you ahead of the competition. Self-service kiosk adoption has seen rapid gains in the past several years as advances in technology coincided with worker shortages in the restaurant industry.
Restaurant owners have realized that using self-service kiosks not only saves on labor costs, but they actually make workers more efficient. KioskBuddy frees up your front-of-house staff to perform tasks aside from taking orders and payments. It helps the back-of-house (BOH) staff too. The kiosk app communicates directly with the kitchen display system, providing the BOH team with quick and accurate ordering information.
A strong business plan will save you time and money in the long run. With 60% of all restaurants failing in the first year, you can’t afford to not plan ahead. Boost productivity and eliminate problems before they pop up by creating a detailed business plan.
All strong business plans should start off with an executive summary. Afterward, describe what makes your company unique before diving into your marketing plan and the way your company is set up. Next, create a detailed menu. Remember that this will serve to distinguish you from the competition. Finally, conduct a market analysis and go over your financial projections.
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