A Comprehensive Guide to Starting a Restaurant

It is convenience that underscores the emerging trends of the food service industry. With more and more singles, busy working parents and the aged looking for hassle free ordering and procurement of food, things look bright for the restaurant industry.

But, things can also change rapidly in the restaurant industry. One can never achieve overnight success in the restaurant industry. It is more of a slow and steady effort and toil that would lead one to make a living in the restaurant industry.

Several industries fail in their very first year of launch due to lack of planning or foresight. But, there is nothing that can deter you from success if you streamline activities.

Always plan ahead for the digital launch of the restaurant too. A website for your restaurant is the most powerful revenue generator, especially during these post pandemic days.

Use Restaurantify to build yourself a restaurant website within minutes. No coding knowledge is required for website creation as they makes it an extremely simple and effective process for you. www.restaurantify.com templates are meant exclusively for restaurants and are customizable. They look and work effectively on any gadget. Getting online food orders and secure online payments for the same are made available on your website.

Restaurantify charges only a nominal fee for its surprisingly superior suite of services in website creation and maintenance.

We have prepared this compilation of steps to guide you through the process of starting your own restaurant.

TARGET MARKET

If you try satisfying everyone, you end up satisfying no one. So, focus primarily on the market share that you can get and forget about the rest.

The main market categories of customers for a restaurant would be:

Generation Y - Also called the millennial generation, they are the people born between 1980 and 2000. It is three times the size of Generation X and also the most ethnically diverse. They should ideally be the primary target of any restaurant. Such people prefer fast-food and other quick service restaurants.

Generation X - They are the people born between 1965 and 1980. They uphold strong family values and strive to maintain good relationships with their children. If you offer a comfortable environment which focuses on ambience, quality and value, you have won their hearts.

Baby Boomers - They are the people born between 1946 and 1964. Constituting the largest segment of the U.S. population, they visit upscale restaurants and also spend lavishly. Back in the 1980s, they were the main targets for trendy restaurants. If you provide a formal, upscale atmosphere for these baby bloomers, they are your patrons.

Empty Nesters - These people are anywhere between the early 50s to below 64. They have adult children who do not live with them. This group visits upscale restaurants as they have the highest per-capita income. Prices do not concern them. They expect outstanding customer service and excellent food.

Seniors - People who are 65 and above form a part of this group. Since they have fixed incomes, they prefer family style restaurants with good service and pocket friendly prices. Younger seniors tend to dine out more frequently than older seniors. Since their appetite restricts them from eating large quantities, they like restaurants that provide early-bird specials and senior people menus with smaller portions and reasonable prices.

RESTAURANT SERVICE STYLE

There are three primary categories of restaurants

Quick Service - Fast food restaurants. They offer a limited number of food items that can be cooked quickly and sold at low prices. They offer drive-thru windows and take away services.

Midscale - They are somewhere between quick service and upscale restaurants. They provide food in return for value for money. Several limited midscale restaurants have salad bars and buffets.

Upscale - Such restaurants focus on the quality of their cuisine and the ambience of the restaurant. They are fine-dining establishments charging the highest prices for their food.

FOOD CONCEPT

Some of the most popular restaurant food concepts are:

Seafood - Quick service seafood restaurants serve a limited assortment of fried seafood. Midscale and upscale seafood restaurants serve a wider range of baked, broiled and grilled seafood.

Steakhouses - Midscale steakhouses sport a casual environment and are family - oriented. Upscale steakhouses have a formal atmosphere and charge higher prices.

Family-style restaurants - As the name suggests, these restaurants target families. They charge reasonable prices and offer speedy service. Their menu caters to everyone - from children to seniors. They provide table service with the decor being comfortable.

Casual-dining restaurants - These restaurants appeal to a wide variety of audience from Generation Y and X to baby boomers, empty nesters and seniors. Their menu has appetizers, salads, main course dishes and desserts. Their atmosphere is comfortable and prices are midrange.

Ethnic Restaurants - They constitute a significant portion of the U.S. restaurant market. They could be quick-service places or upscale eatouts. They serve not just authentic food, but also Americanized versions of ethnic menu items.

Pizzeria - You could choose to start a modest facility with limited seating and self service environment or a full-service pizza restaurant having a menu of stunning pizzas, beer and wine. Since pizza is the heart and soul of your business, hire a good pizza maker if you do not master the tricks.

Sandwich Shop - People prefer running a sandwich shop as the profit margins brought by it are high. Sandwich shops can change menus rapidly and adapt to current trends in the food industry. Most sandwich shops these days offer low-fat, healthy ingredients in their sandwiches, salads and other menu items.

Coffeehouse - Coffee is the world’s most popular beverage. But people visit coffeehouses not just for the coffee, but for various other reasons - to meet friends, hang around, enjoy some lonely me-time, for a quick lunch or simply to start the day with a great coffee. If you become successful, you will be serving 500 customers per day. Profit margins are also high. Providing cappuccinos, lattes, teas, bottled water, fresh fruit juices, baked items and desserts is also necessary to achieve the volume of sales required for a higher profit margin.

Bakery - Bread-only retail bakeries have nearly disappeared from the United States because of heavy competition from sophisticated supermarkets having in-store bakeries. The bakery market is highly competitive. One must offer cakes, scones, bagels, coffee drinks, sandwiches, beer and wine to face competition. Unless one has a unique disposition that the customers love, your survival is challenging.

WHAT IS YOUR NICHE?

Always decide which particular segment of the food industry you wish to enter.

Your personality and preferences can also dictate whether a commercial bakery, a coffee cart or a fine-dining restaurant would be the correct choice for you. Once you have decided the kind of business that best suits you, identify the niche that you wish to conquer in your marketplace.

If you are an early bird and get things going early in the morning, your nice could be a busy bakery or a breakfast and lunch outlet. But, if you like to stay up late or sleep late, you could choose a fine-dining model or even a bar-and-grill type restaurant or pizzerias.

Only when you understand yourself, building a niche in the market is easy.

BUSINESS PLAN

This is the most significant element of a restaurant. Once this is chalked out carefully, most of the other things fall in place automatically.

Write everything on paper before you start spending even a penny.

Your business plan should include:

A concise definition of the restaurant concept
The menu and pricing
In-depth Financial analysis
Capital at hand and the future requirement
Sources of future funding
Long-term income
Expense forecasts
Employee Hiring
Marketing Plan
Training Programs
Strategies to handle future challenges

BUSINESS FUNDING

Launching a restaurant involves exorbitant spending. But, you should be wise and know where and how to curtail expenses.

Use second hand goods and equipment wherever possible. Buy things online when great offers come your way. Research online for cheaper, yet, quality substitutes for products that you require. Work out long-term financial plans with suppliers and investors.

LOCATION

Choose a location that can contribute effectively to your sales volume without burning your pocket much. If you rely a lot on foot traffic to your restaurant, find a place that people can easily walk into.

Decide on how much rent you can pay by looking at the sales and profit projection of the first year of business.

The location should have an ample parking space with proper entry and exit points. Instead of renting a property, lease it. Carefully read through all the details of the lease so that a few unacceptable leasing terms do not escape your attention.

Do make a quick check with the local town authorities or the planning board if any new building or road construction has been planned in the site in the near future. This could drastically affect your business. So, do a pre-planned investigation of this factor too.

LAYOUT

Design and layout can determine the success of your restaurant. Consider the size and layout of the dining room, kitchen space, warehouse space and office. Allocate 45 to 65 percent of the total space to the dining area. 35 percent of the area must be dedicated to the kitchen and prep area and the remaining space can be allotted for storage and office purposes.

MENU CREATION

Stay updated of the latest trends in terms of restaurant menu and design.

While consumers are eating more chicken, seafood and beef dishes, they also expect to see meatless options offered on the menu.

Diners, these days, are looking for ‘comfort food’ - food that makes them nostalgic and takes them back to their childhood days.

HUMAN RESOURCE MANAGEMENT

If you do not hire qualified labor for your restaurant, your doom is near.

Finding skilled workers and rising labor costs are key concerns for any restaurateur.

Develop a comprehensive HR strategy to decide what the specific roles of a labor in your restaurant would be. While the job description need not be formal, it must definitely outline all the duties and responsibilities that the person is expected to perform.

Also list out the special skills that you expect or other required credentials like a driver’s license or a good driving record, etc.

MARKETING AND PROMOTION

Despite the digital tools ruling all marketing strategies, word-of-mouth has not lost its charm.

More than 4 out of 5 people choose a table-service restaurant that they have never visited before based on the suggestion or recommendation from a friend, relative or acquaintance.

So, give customers a dazzling dining experience. This would be the strongest foundation for your marketing program. Customers will talk about you and make repeated visits to your restaurant.

Respect every feedback given to you - personally and on the Internet. React to them in the most polite manner. Constantly check which advertising channel is bringing you traffic. Make greater use of them and eliminate those that do not fetch expected results.

With so much said regarding starting a restaurant, one thing must always be kept in mind. The story is never the same for two restaurateurs. So, while following the comprehensive list that we have charted out for you, also follow the instinct within. Always give higher priority to what works in your favor and let go of anything that could be a hindrance to your restaurant’s success.