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MAR.01, 2021

Mexican Restaurant Business Plan

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Article Business Plan Templates Food & Beverage Business Plans Restaurant Business plans | OGSCapital
Mexican Restaurant Business Plan

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Table of Content

    Do you want to start Mexican restaurant business plan?

    Do you want to open a Mexican restaurant? Well, Mexican foods are high in demand as they are loved by people of all ages and life areas. From Enchiladas to Taco, Mexican foods are all about delight.

    The business can prove out to be extremely profitable provided that you plan it effectively. There are only a few areas that require extreme care and consideration. The topmost among them is regarding maintaining the food quality and nutritional value.

    To apprehend how to open Mexican restaurant you should start exploring and researching. You will be needed to pen down your findings in a business plan for a Mexican restaurant to come up with a structured approach for starting this business. In case, you are unaware of how to make an accurate business plan, you can take help from this sample plan written for ‘Mexican Delicacies’.

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    Executive Summary

    2.1 The Business

    Mexican Delicacies will be a registered and licensed food restaurant based in New York. The business will primarily provide Mexican foods and desserts to the citizens of New York. Moreover, a few internationally-acclaimed cuisines will also be offered in the restaurant.

    2.2 Management of Mexican Restaurant

    Mexican Delicacies will be managed and run by its owner, co-manager, and team. Since the restaurant aims at providing supreme quality service to its customers, strict supervision will be held in place. Moreover, a building that was previously used as a restaurant will be acquired on rent and renovated to create a Mexican culture environment.

    In this start up summary for a restaurant we have listed a brief management plan. To have a complete idea of how to set up a Mexican restaurant business plan keep reading this sample executive summary of a Mexican restaurant business plan.

    2.3 Customers of Mexican Restaurant

    Our major customers will be the local community living near us, Mexican communities, and tourists.

    2.4 Business Target

    Our major targets are:

    • To achieve a repeat purchase rate of 80% by the end of the first year
    • To maintain a CSAT score of above 90% throughout our service years
    • To earn a net profit margin of $28.6k per month by the end of the third year
    • To earn an average rating above 4.75 within two years of our launch

    Mexican Restaurant Business Plan - 3 Years Profit Forecast

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    Company Summary

    3.1 Company Owner

    Mexican Delights will be owned by Matt Downey. Matt had always remained enthusiastic about food. After completing his MBA, he joined Krispy Kreme as a manager. Throughout his academic and service years, he remained an active participant in cooking competitions.

    3.2 Why the Mexican restaurant is being started

    Matt had to start a business at some point in his life. Due to his interest in the cooking side, he decided to opt for some cooking-related business. After surveying his target marketplace, he discovered that there was a huge demand for Mexican cuisines.

    3.3 How the Mexican restaurant will be started

    Step1: Plan Everything

    For starting a Mexican restaurant business, you have to first create a business plan. In this Mexican restaurant business plan sample we will be providing all the details of Mexcian Delights so that you can learn how to create an accurate business plan. However, if your offerings are different than ours, then it is recommended to also study more Mexican restaurant business plan examples before finalizing your plan.

    Step2: Define the Brand

    The second step is to get the licenses and required registrations to start establishing yourself. At the time, you should define your business values, targets, and offerings that you can get identified in the market.

    Step3: Establish the Restaurant

    The next step is to purchase the inventory and furniture to set up your restaurant. The décor and environment of a restaurant matter a lot. Therefore, make sure that you are offering a serene and refreshing environment to your customers.

    Step4: Never Ignore the Web Presence

    Establishing a website and social media sites is vital to attract more and more people to your site. And to let them know your specialties through their fellow’s comments.

    Step5: Promote and Market

    Lastly, you should develop advertisement and marketing business strategies to get introduced to your target audience.

    To give you an idea of how much does it cost to open a Mexican restaurant we are providing a list of startup costs of Mexican Delights.

    Mexican Restaurant Business Plan - Startup Cost

    Start-up Expenses  
    Legal $251,000
    Consultants $0
    Insurance $31,000
    Rent $34,000
    Research and Development $24,000
    Expensed Equipment $47,000
    Signs $4,000
    TOTAL START-UP EXPENSES $391,000
    Start-up Assets $374,000
    Cash Required $398,000
    Start-up Inventory $52,000
    Other Current Assets $289,000
    Long-term Assets $295,000
    TOTAL ASSETS $1,408,000
    Total Requirements $1,799,000
    START-UP FUNDING
    Start-up Expenses to Fund $391,000
    Start-up Assets to Fund $1,408,000
    TOTAL FUNDING REQUIRED $1,799,000
    Assets
    Non-cash Assets from Start-up $1,834,000
    Cash Requirements from Start-up $398,000
    Additional Cash Raised $51,200
    Cash Balance on Starting Date $32,000
    TOTAL ASSETS $2,315,200
    Liabilities and Capital
    Liabilities $30,000
    Current Borrowing $0
    Long-term Liabilities $0
    Accounts Payable (Outstanding Bills) $44,000
    Other Current Liabilities (interest-free) $0
    TOTAL LIABILITIES $74,000
    Capital
    Planned Investment $1,799,000
    Investor 1 $0
    Investor 2 $0
    Other $0
    Additional Investment Requirement $0
    TOTAL PLANNED INVESTMENT $1,799,000
    Loss at Start-up (Start-up Expenses) $442,200
    TOTAL CAPITAL $2,241,200
    TOTAL CAPITAL AND LIABILITIES $2,315,200
    Total Funding $1,799,000
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    Services

    In your Mexican restaurant business plan template you should define your services so that you can make the relevant arrangements. Stating your services in your business fast food Mexican plan restaurant will also help you in identifying your customers and daily buying trends.

    Mexican Delights will offer the following delicious servings to its customers.

    • Traditional Mexican Cuisines: We will offer all of the Mexican cuisines that are famous among our target customers. Our major offerings will include:
      • Taco
      • Guacamole
      • Enchiladas
      • Chilaquiles
      • Tamales
      • Pozole
      • Bistec
      • Huevos rancheros and more.
    • Mexican Drinks: Our drink offerings will include the following items:
      • Tequila
      • Mezcal
      • Kahlúa
      • Mexican Coke
      • Horchata
      • Hot Chocolate
    • Mexican Desserts: We will be offering several Mexican desserts and sweet dishes such as:
      • Chiles en nogada
      • Mexican Cinnamon Cookies
      • Churros
      • Tres Leches Cake
      • Creamy Caramel Flan
      • Mexican Brownies
      • Dulce de Leche Cheesecake and more.
    • International Foods: We will also offer foods that are liked by people of all regions. They will range from local American dishes to Italian and Spanish delicacies. Moreover, seafood dishes and some fast food items will also be offered in this category.

    Marketing Analysis of Mexican Restaurant

    Note

    Marketing analysis is also an important component of your business. It studies the respective market and search for previous trends, analytics, and ups and down to predict the future value of services. Through marketing analysis, you can learn when It would be most profitable to launch your business or introduce a new service/ product. Moreover, having knowledge of your market and customers helps you understand the ways that can attract them to your restaurant.

    Here we are providing all details of Mexican Delights to assist you in case you are looking for how to write a business plan for a Mexican restaurant or how to carry out an accurate marketing analysis.

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    5.1 Market Trends

    Due to the increased popularity and demand for Mexican foods, Mexican food restaurants have seen a growth rate of 4% during the past five years i.e. from 2016 to 2021. This stat is recorded by IBISWorld for the United States. The source also states that the Mexican restaurant industry is expected to grow by another 22.5% in 2021 alone. And the market size for this business is reported to reach $66.9 billion in 2021.

    This Mexican restaurant industry analysis suggest that it is the right time to open Mexican restaurant. As stats are really good, it is highly recommended to enter this venture without any unnecessary delay.

    5.2 Marketing Segmentation

    Before exploring how to set up a Mexican restaurant business plan you should identify who your customers are. Because the groups of your target customer will be affecting your long-time decisions.

    In this business plan, we’re providing the market segmentation done for Mexican Delights.

    Mexican Restaurant Business Plan - Marketing Segmentation

    5.2.1 Local Communities

    Our primary customers will be the local Anglo-Americans living near us. They are expected to devour our Mexican dishes as these dishes are different than local foods due to their distinct tastes and nutritional value. Since this community will also include cross-cultural minorities, thus, we expect them to enjoy our internationally acclaimed foods too.

    5.2.2 Mexican Communities

    The second group of our target customers will comprise the Mexican minorities living near us. They are expected to visit us frequently. Firstly, because of our large menu and wide range of offerings. And secondly, because of the immersive Mexican cultural environment, we’ll be demonstrating through our décor. Another thing that will help us draw more Mexicans is that we do not have abundant Mexican food restaurants servicing near us within 20 to 25-minute driving distance.

    5.2.3 Tourists

    Our third category of target customers will be tourists. This category will comprise the explorers who also want to explore traditional foods of different countries.

    Market Analysis
    Potential Customers Growth Year 1 Year 2 Year 3 Year 4 Year 5 CAGR
    Local Communities 49% 51,000 52,000 53,000 54,000 55,000 10.00%
    Mexican Communities 41% 43,000 44,000 45,000 46,000 47,000 10.00%
    Tourists 10% 9,000 10,000 11,000 12,000 13,000 11.00%
    Total 100% 103,000 106,000 109,000 112,000 115,000 10%

    5.3 Business Target

    Our business targets relevant to market customers are to achieve a repeat purchase rate of 80% by the end of the first year. Moreover, we aim to maintain a CSAT score of above 90% and an average rating above 4.75 in a specified time.

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    Marketing Strategy

    Many restaurants are operating in the whole of the United States. In case you want to outperform others, you’ll need to come up with competitive benefits and an influencing advertisement plan.

    In your Mexican restaurant business plan template you should include a detailed marketing plan. To help you in devising this part, we’re providing a marketing plan for a restaurant pdf of Mexican Delights.

    6.1 Competitive Analysis

    Our biggest competitive advantages are listed here:

    1. We are offering a wide variety of foods to attract customers from different walks of life.
    2. Our restaurant is specifically designed to provide a powerful environment. We hired professional décor services to install cultural items of Mexico and to create 3D posters of Mexican celebrities to provide an immersive experience to our customers.
    3. Lastly, due to our extraordinary sales strategy, we expect to get more customers as compared to our competitors.

    6.2 Sales Strategy

    • We’ll advertise our startup through Google Local ads service and social media campaigns.
    • We’ll invite a famous and beloved Mexican celebrity to our launching ceremony to mark our exclusive startup.
    • We’ll keep track of our repeat customers and will offer them a 25% discount on all of our offerings after their first twenty purchases.

    6.3 Sales Monthly

    Mexican Restaurant Business Plan - Sales Monthly

    6.4 Sales Yearly

    Mexican Restaurant Business Plan - Sales Yearly

    6.5 Sales Forecast

    Mexican Restaurant Business Plan - Unit Sales

    Sales Forecast      
    Unit Sales Year 1 Year 2 Year 3
    Traditional Mexican Cuisines 55,000 58,300 61,798
    Mexican Drinks 12,000 12,720 13,483
    Mexican Desserts 34,000 36,040 38,202
    International Foods 49,000 51,940 55,056
    TOTAL UNIT SALES 150,000 159,000 168,540
    Unit Prices Year 1 Year 2 Year 3
    Traditional Mexican Cuisines $56.00 $64.96 $75.35
    Mexican Drinks $50.00 $58.00 $67.28
    Mexican Desserts $46.00 $53.36 $61.90
    International Foods $58.00 $67.28 $78.04
    Sales
    Traditional Mexican Cuisines $3,080,000.00 $3,787,168.00 $4,656,701.77
    Mexican Drinks $600,000.00 $737,760.00 $907,149.70
    Mexican Desserts $1,564,000.00 $1,923,094.40 $2,364,636.87
    International Foods $2,842,000.00 $3,494,523.20 $4,296,865.73
    TOTAL SALES $8,086,000.00 $9,942,545.60 $12,225,354.07
    Direct Unit Costs Year 1 Year 2 Year 3
    Traditional Mexican Cuisines $54.00 $61.00 $71.00
    Mexican Drinks $47.00 $55.00 $63.00
    Mexican Desserts $43.00 $49.00 $56.00
    International Foods $55.00 $64.00 $73.00
    Direct Cost of Sales
    Traditional Mexican Cuisines $2,970,000.00 $3,556,300.00 $4,387,658.00
    Mexican Drinks $564,000.00 $699,600.00 $849,441.60
    Mexican Desserts $1,462,000.00 $1,765,960.00 $2,139,334.40
    International Foods $2,695,000.00 $3,324,160.00 $4,019,117.20
    Subtotal Direct Cost of Sales $7,691,000.00 $9,346,020.00 $11,395,551.20

    Personnel plan

    When you write business plan Mexican restaurant you should also create a peroneal and HR management plan. This will eventually help you in retaining a skilled and motivated workforce.

    Any questions? Get in Touch!

    7.1 Company Staff

    Matt will be the CEO herself. To run his business, he’ll hire.

    • 1 Co-Manager to monitor business operations
    • 1 Accountant to maintain financial records
    • 8 Cooks to prepare the dishes
    • 6 Waiters to serve the food
    • 2 General Assistants for routine tasks
    • 1 Technician to maintain the machinery
    • 1 Web Developer to manage the online presence
    • 1 Sales Executive to execute the restaurant’s sales strategy
    • 4 Cleaners
    • 1 Receptionist

    7.2 Average Salary of Employees

     Personnel Plan      
    Year 1 Year 2 Year 3
    Co-Manager $12,000 $13,200 $14,520
    Accountant $9,000 $9,900 $10,890
    Cooks $64,000 $70,400 $77,440
    Waiters $40,000 $44,000 $48,400
    Technician $6,000 $6,600 $7,260
    General Assistants $12,000 $13,200 $14,520
    Web Developer $6,000 $6,600 $7,260
    Cleaners $28,000 $30,800 $33,880
    Sales Executive $7,000 $7,700 $8,470
    Receptionist $6,000 $6,600 $7,260
    Total Salaries $190,000 $209,000 $229,900

    Financial Plan

    A financial plan is one of the most important components to include when you write business plan Mexican restaurant. A financial plan analyzes the costs involved in running your business as well as the monthly and yearly sales. By gathering all the business analytics, an accurate financial plan suggests a time at which you will be able to recover your startup costs. Moreover, it also incorporates financial risks to figure out a strategy to minimize or even avoid undesirable losses.

    A business can never achieve its goals without a proper financial record and management. Therefore, you must take care of this part cautiously. If you lack the experience of making a financial plan, it is highly recommended to hire a professional financial analyst to do so.

    8.1 Important Assumptions

     General Assumptions      
    Year 1 Year 2 Year 3
    Plan Month 1 2 3
    Current Interest Rate 8.13% 8.16% 8.21%
    Long-term Interest Rate 8.27% 8.35% 8.40%
    Tax Rate 23.60% 23.90% 24.40%
    Other 0 0 0

    8.2 Break-even Analysis

    Mexican Restaurant Business Plan - Break-even Analysis

     Break-Even Analysis  
    Monthly Units Break-even 5344
    Monthly Revenue Break-even $132,500
    Assumptions:
    Average Per-Unit Revenue $236.00
    Average Per-Unit Variable Cost $0.67
    Estimated Monthly Fixed Cost $161,200

    8.3 Projected Profit and Loss

     Pro Forma Profit And Loss      
    Year 1 Year 2 Year 3
    Sales $8,086,000 $9,942,546 $12,225,354
    Direct Cost of Sales $7,691,000 $9,346,020 $11,395,551
    Other $0 $0 $0
    TOTAL COST OF SALES $7,691,000 $9,346,020 $11,395,551
    Gross Margin $395,000 $596,526 $829,803
    Gross Margin % 4.88% 6.00% 6.79%
    Expenses
    Payroll $190,000 $209,000 $229,900
    Sales and Marketing and Other Expenses $130,000 $128,000 $127,000
    Depreciation $2,500 $2,600 $2,400
    Leased Equipment $0 $0 $0
    Utilities $3,000 $3,090 $3,120
    Insurance $1,900 $2,090 $2,160
    Rent $3,400 $3,500 $3,600
    Payroll Taxes $30,000 $31,000 $32,000
    Other $0 $0 $0
    Total Operating Expenses $360,800 $379,280 $400,180
    Profit Before Interest and Taxes $34,200 $217,246 $429,623
    EBITDA $34,200 $217,246 $429,623
    Interest Expense $0 $0 $0
    Taxes Incurred $6,840 $43,449 $85,925
    Net Profit $27,360 $173,796 $343,698
    Net Profit/Sales 0.34% 1.75% 2.81%

    8.3.1 Profit Monthly

    Mexican Restaurant Business Plan - Profit Monthly

    8.3.2 Profit Yearly

    Mexican Restaurant Business Plan - Profit Yearly

    8.3.3 Gross Margin Monthly

    Mexican Restaurant Business Plan - Gross Margin Monthly

    8.3.4 Gross Margin Yearly

    Mexican Restaurant Business Plan - Gross Margin Yearly

    8.4 Projected Cash Flow

    Mexican Restaurant Business Plan - Projected Cash Flow

     Pro Forma Cash Flow      
    Cash Received Year 1 Year 2 Year 3
    Cash from Operations
    Cash Sales $56,000 $60,480 $65,318
    Cash from Receivables $18,000 $19,440 $20,995
    SUBTOTAL CASH FROM OPERATIONS $74,000 $80,660 $87,113
    Additional Cash Received
    Sales Tax, VAT, HST/GST Received $0 $0 $0
    New Current Borrowing $0 $0 $0
    New Other Liabilities (interest-free) $0 $0 $0
    New Long-term Liabilities $0 $0 $0
    Sales of Other Current Assets $0 $0 $0
    Sales of Long-term Assets $0 $0 $0
    New Investment Received $0 $0 $0
    SUBTOTAL CASH RECEIVED $75,000 $82,000 $89,000
    Expenditures Year 1 Year 2 Year 3
    Expenditures from Operations
    Cash Spending $37,000 $40,000 $43,000
    Bill Payments $28,000 $30,000 $32,000
    SUBTOTAL SPENT ON OPERATIONS $65,000 $70,000 $75,000
    Additional Cash Spent
    Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
    Principal Repayment of Current Borrowing $0 $0 $0
    Other Liabilities Principal Repayment $0 $0 $0
    Long-term Liabilities Principal Repayment $0 $0 $0
    Purchase Other Current Assets $0 $0 $0
    Purchase Long-term Assets $0 $0 $0
    Dividends $0 $0 $0
    SUBTOTAL CASH SPENT $65,000 $70,200 $75,816
    Net Cash Flow $15,000 $16,000 $17,200
    Cash Balance $26,500 $28,000 $30,000

    8.5 Projected Balance Sheet

     Pro Forma Balance Sheet      
    Assets Year 1 Year 2 Year 3
    Current Assets
    Cash $288,000 $322,560 $354,816
    Accounts Receivable $25,000 $28,000 $31,472
    Inventory $4,000 $4,480 $4,900
    Other Current Assets $1,000 $1,000 $1,000
    TOTAL CURRENT ASSETS $294,000 $329,280 $370,111
    Long-term Assets
    Long-term Assets $10,000 $10,000 $10,000
    Accumulated Depreciation $18,200 $20,384 $22,932
    TOTAL LONG-TERM ASSETS $24,000 $26,880 $30,240
    TOTAL ASSETS $296,000 $331,520 $372,960
    Liabilities and Capital Year 4 Year 5 Year 6
    Current Liabilities
    Accounts Payable $21,100 $23,632 $26,562
    Current Borrowing $0 $0 $0
    Other Current Liabilities $0 $0 $0
    SUBTOTAL CURRENT LIABILITIES $14,000 $15,680 $17,624
    Long-term Liabilities $0 $0 $0
    TOTAL LIABILITIES $16,000 $17,920 $20,142
    Paid-in Capital $30,000 $32,000 $33,000
    Retained Earnings $54,000 $58,860 $64,746
    Earnings $198,000 $215,820 $237,402
    TOTAL CAPITAL $273,000 $297,570 $327,327
    TOTAL LIABILITIES AND CAPITAL $289,000 $331,520 $372,960
    Net Worth $297,000 $323,730 $356,103

    8.6 Business Ratios

     Ratio Analysis        
    Year 1 Year 2 Year 3 INDUSTRY PROFILE
    Sales Growth 7.07% 7.83% 8.68% 3.00%
    Percent of Total Assets
    Accounts Receivable 9.22% 10.22% 11.32% 9.80%
    Inventory 5.60% 6.20% 6.87% 9.90%
    Other Current Assets 2.13% 2.36% 2.61% 2.40%
    Total Current Assets 150.12% 151.80% 152.30% 158.00%
    Long-term Assets 11.80% 11.86% 11.92% 12.00%
    TOTAL ASSETS 100.00% 100.00% 100.00% 100.00%
    Current Liabilities 4.65% 4.69% 4.73% 4.34%
    Long-term Liabilities 0.00% 0.00% 0.00% 0.00%
    Total Liabilities 7.52% 7.58% 7.65% 7.38%
    NET WORTH 101.09% 101.90% 102.84% 110.00%
    Percent of Sales
    Sales 100.00% 100.00% 100.00% 100.00%
    Gross Margin 94.99% 97.55% 100.29% 99.00%
    Selling, General & Administrative Expenses 93.71% 96.24% 98.93% 97.80%
    Advertising Expenses 1.69% 1.74% 1.78% 1.40%
    Profit Before Interest and Taxes 41.05% 42.16% 43.34% 33.90%
    Main Ratios
    Current 37 38 39 32
    Quick 31 32.8 33.62 33
    Total Debt to Total Assets 0.19% 0.19% 0.18% 0.40%
    Pre-tax Return on Net Worth 74.81% 75.50% 76.23% 75.00%
    Pre-tax Return on Assets 94.04% 98.74% 103.68% 111.30%
    Additional Ratios Year 1 Year 2 Year 3
    Net Profit Margin 32.91% 33.93% 34.98% N.A.
    Return on Equity 54.98% 56.68% 58.44% N.A.
    Activity Ratios
    Accounts Receivable Turnover 7.8 7.8 7.9 N.A.
    Collection Days 100 100 100 N.A.
    Inventory Turnover 32.8 34.44 35.6 N.A.
    Accounts Payable Turnover 16.1 16.3 16.59 N.A.
    Payment Days 27 27 27 N.A.
    Total Asset Turnover 2.4 2.5 2.6 N.A.
    Debt Ratios
    Debt to Net Worth -0.03 -0.03 -0.04 N.A.
    Current Liab. to Liab. 1 1 1 N.A.
    Liquidity Ratios
    Net Working Capital $243,000 $256,608 $270,978 N.A.
    Interest Coverage 0 0 0 N.A.
    Additional Ratios
    Assets to Sales 0.83 0.85 0.89 N.A.
    Current Debt/Total Assets 1% 0% 0% N.A.
    Acid Test 27.8 28.2 28.7 N.A.
    Sales/Net Worth 2.1 2.2 2.2 N.A.
    Dividend Payout 0 0 0 N.A.

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