Introduction Frequently asked questions of the restaurant business Restaurant business plan summary Market analysis…
Business Plan for a Restaurant
A business plan for a restaurant is a roadmap for future success. It not only sets the path for growing the business, it also forces the entrepreneur to consider the many pitfalls that restaurant owners face. Everyone sees restaurants come and go in their local areas, and there is a good reason. A restaurant requires a significant investment in space, equipment, and staff and needs a steady supply of customers. All too often the eating establishment opens to a lot of fanfare and plenty of curious customers, followed by a steady reduction in the number of diners over time.
Most restaurant startups or expansions need investors or bank loans. The business plan is a critical document for convincing funders to risk money on the enterprise. A well-prepared document can “close the deal” because it proves the entrepreneur has thought about each step required for opening the business and for generating cash flow so that the doors can stay open.
• Executive Summary – Describe the restaurant concept, the general plan for success, and the cost. This section should generate reader excitement about the business opportunity. If it does not, the reader is unlikely to continue reading, and that can mean lost investors.
• Company Description – Describe the ownership plan, capitalization requirements, legal structure, site selection process, and business concept. The business concept description creates a picture in words of what the restaurant will be like – ambiance, service style, seating arrangements, décor, sample menu, unique menu offerings, and so on. Investors reading this section are looking for confirmation they should continue reading.
• Management – This is also a critical section because owning and operating a successful business takes skill, energy, and hard work. What makes the entrepreneur qualified to be a restaurant owner? Does management have experience in Human Resources, including developing staffing and compensation plans?
• Competitive Analysis – This section includes a review of the industry and local market, a description of the niche market targeted, an analysis of the direct competition, and a location analysis. Why was a particular market and site selected? What information and data supports the decision to start a particular type of restaurant in a particular location?
• marketing plan – The marketing plan is the plan for bringing in customers from the first day and well into the future. There are many ways to market a restaurant including offering opening specials, developing repeat customer programs, online and offline advertising, mobile advertising, and so on.
• Operating Plan – Does the restaurant need a European trained chef or short order cooks? How will staff be recruited to cover the hours of operations? Who will train the new staff? Who will order supplies, manage the menu, take care of inventory, track revenues and expenses, ensure health regulations and safety standards are met, and so o?
• Financial Plan – Investors who read this far in the business plan are interested in the restaurant concept and plans for success. The financial statements should reflect a reasonable plan for growing revenues and achieving profitability. It puts into numbers what the previous sections described.
Successful business plan for a restaurant
Opening and managing a successful restaurant is not easy because there are so many details to consider. The business plan is a critical document for ensuring all the elements of success are well thought out. It never pays to take shortcuts, and that applies to developing a business plan for a restaurant.
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