While it might be impossible to give you a comprehensive guide, this detailed articles will list the top 10 things you need to open a new restaurant or bar.
Ciao, I’m Nico, a marketing consultant for restaurants and the founder of Forketers.
You are new to this site, you can use this platform to help your existing or proposed restaurant move beyond the kitchen offerings with strategies to line your pockets.
I always tell my clients, a successful journey begins away from the plate.
With that being said, we should get to the topic of the day so you know what you need to open your own restaurant. This is a question I get asked from every aspiring Ray Kroc the world over.
The answer is very simple.
Actually, the answer is very colluded with layers, but I can tell you that there are 10 things you need to open a beautiful little eatery without losing yourself in the details.
These items to be listed are universal and should work with every type of restaurant, no matter where you open up around the world.
Are you ready? Let’s go.
1. Money, Money, and Yeah, a Little Money
Number one, money, money and money.
There is nothing free in the world, even the air we breathe might be a charge in the future. When opening a restaurant or bar, you can add the word “free” to the drawer of oblivion.
Everything costs you something, from the paperwork and equipment to salaries and supplies. To put it bluntly, you need bread.
I’ve heard of strategies to open a restaurant with no money, but I’ve yet to meet someone to actually do that.
If you know someone, please introduce me.
So how do we find the money to open our restaurant? Excluding bank robberies, which ironically happen often in my area, the winning strategy is always the same and comes in two phases:
- The first step is to visit your parents, relatives, friends, in-laws and anyone else who might be willing to lend you some money to fund your dream.
- Secondly, for the amount you still need (even if no one has lent you anything), you can borrow from the bank and financial institutions. They are often eager to lend or partner with an up and coming business with promise.
It should go without saying that to obtain a loan, you have to show that you have a serious and credible plan with costs well-calculated.
So how do you do that?
It starts with a convincing business plan made to perfection; not four sheets with scribbles and random numbers. I see that often.
2. A Bale-Breaking Business Plan
The second thing you need, as I just said, is a business plan.
This is one of the most important things to do, not just to get cash for your venture, but to also show you from the very beginning if you idea can be profitable.
I remember working in Dubai for Pizzaro, a chain of Italian restaurants, and the corporate chef compared the business plan to a flight simulator designed to help people understand the effectiveness and importance of their business.
According to that chef, the business plan lets an entrepreneur notice the crap he does without killing anyone, much like a flight simulator.
The business plan is a paper simulation of what your restaurant can do.
It makes you think about many different things and you can visually interpret the pitfalls that exist in your dreamy haze while its still on paper. No one gets hurt.
The challenging aspect of a business plan is that most entrepreneurs do not know where to start or how to orientate themselves.
I remember when I tried to make my first business plan for a coffee shop in Sicily.
I was going crazy.
After many days, I was still sitting in front of a blank sheet of paper with the title “Business Plan”. Even my customers who open restaurants today contact me desperate because they don’t know how to even get started.
Now, after seeing and making hundreds of plans, I have come to understand one thing:
I needed to make a compass of sorts to help restauranteurs navigate the creation of their business plan.
Take a look at it, I think it can be a useful tool for you.
3. Licenses, Permits and Bureaucratic Problems
The third thing you need is a real pain, and of course I’m referring to the documentation you need to maintain compliance with local laws.
Before you can ever open your doors in a new place, you need licenses, permits, haccp, and must jump through several hoops that vary by country. Of course, the concept of your restaurant plays a role in this as well.
For example, if your restaurant only serves bread, cheese and Coca Cola, you don’t need the same licensing and documentation as a restaurant specializing in seafood fare and cocktails.
While I do not know where you are, countries like mine (Italy) require the patience of Christ himself to submit all of the appropriate documents necessary to open a new public eatery.
Even those clients of mine in the US and the United Arab Emirates also tell me similar stories of excessive lengths of time and the need for patience.
If you want to open up a restaurant, you need to have a nice list with the necessary documentation and licenses, and the time for you to acquire them without stress.
Fortunately, unlike 20 years ago, this is not an impossible mission.
Armed with a pen, paper, and the internet, you can make a list of the documents and certifications you need and the order they need to get acquired.
4. Location, Location and Location
Number four, is the location. For obvious reasons, this cannot just be your home.
I should note that in fishing villages around the world I’ve eaten in real restaurants that were just houses where fishermen slept.
And I’ll tell you more, I ate like hell.
To find the ideal location, you can have to put in some leg work. It is not as simple as a space where you can throw up 4 tables and 4 chairs. This site needs specific characteristics.
The first of these is accessibility for your target audience. For example, you can’t open a high-class restaurant in a poor neighborhood – that just doesn’t make any sense.
When determining locations, there are two consideration that you have to make:
- You can rent or buy a beautiful restaurant already made and ready for use.
- You can build one from scratch, but that involves construction costs, of course.
There are also options such as pop-up spaces and food trucks you can consider as well.
You must understand that you need a physical space to set up a restaurant, something that lines up with the objectives of the business and the concept you have created for the restaurant. It is the only way to ensure revenue.
If the most you can make in a month is 10,000 dollars, you need to consider the amount you spend on rent.
5. USP, the Unique Selling Proposition
The number five is the USP, or Unique Selling Proposition, which is what makes you different from your competitors.
You need to listen up well, because this is a vital component that many restauranteurs overlook.
This is the hallmark of your restaurant. If you have a pizzeria and are competing with a thousand other pizzerias throughout a city, why should a customer choose yours? What makes yours different?
Let me give you a practical example:
There are seemingly half a billion pizzerias in Palermo (my city), which can be said for every Italian city.
A client of mine needed to consider what was his point of uniqueness for his pizza a few years back.
After a little time, we birthed the idea of square pizzas and volcanoes (pizzas with high edges and a super thin base).
There are plenty of pizzerias serving delicious round pizzerias, this restaurant serves delicious square pizza in addition to the innovative volcanoes.
While the round pizza might be the best-selling, the square and volcano pizzas have given a uniqueness to the place and helped to promote the restaurant via word of mouth.
So, the moral of this story? Find your point of uniqueness to help you stand out from the crowd.
6. The Concept of the Restaurant
The sixth thing that you need is a concept for your restaurant, which defines who the hell you are.
You are an informal fish restaurant, a fast food restaurant for university students, a family pizzeria, a quick cafeteria, a fine dining establishment, fast casual dining…whatever you are, be clear and concise about it.
You need to be clear about who you are, otherwise you risk trying to be and do everything and no one cares about you restaurant. That’s a guarantee.
You cannot fear polarity. Try to radiate your strength and charisma by embracing one thing.
If your small seaside restaurant serves fresh fish, don’t muddy the waters by attempting to make pizza too.
Likewise, if you have a fast and light restaurant for the business eater on the go to get a quick bite, do not modify your menu with obscure sausage and potato sandwiches.
Screwing up the menu is only part of the potential problem, you could also encourage a younger crowd that keeps your target audience from ever coming to the restaurant.
Find a clear concept and model all aspects of your restaurant around it.
7. Staff to Face the Struggles to Come
The seventh thing you need is the staff.
This is a point that makes me smile because so often I see a small restaurant with an owner that is also the manager, waiter, chef, accountant, and ten other things.
There is only one thing he is especially good at – nothing!
You need experienced and well-paid staff that can do the jobs they are assigned. Your job is not to bring dirty dishes to the kitchen or to stay in and prepare salads.
You need people who can take care of these tasks.
Your job is to monitor customers and determine why they came, work to improve your service so they come back, and find out what is not working.
The rest of your time is to get spent brainstorming strategies to fill up more chairs throughout the restaurant more consistently.
In Dubai I worked for an Italian chain of restaurants called Pizzaro – a terrifying name but that’s a story I’ve already told 100 times.
I was hired as a manager of the restaurant to increase revenue for a single branch in Dubai. The genius F&B director made me a waiter, cashier, cleaner, accountant, PR representative, human resources department, and also worked as the restaurants manager when there was time.
This F&B director thought he was a genius, and he got along well with the general manager because he kept the staff costs low, so I did everything.
But he didn’t realize a critical little detail.
My branch was literally screwing up because I could not focus on the strategic and managerial part.
Fortunately, someone at the top realized what a disaster this man had caused and took him away from that role. With the change in management, the restaurant quickly recovered.
So… staff, staff, staff.
You cannot be afraid to hire the people that you need to suit the requirements of your restaurant. If you have the time to devote to managerial tasks, you can make the revenue to afford to pay the higher wages.
I assure you.
8. A “Real” Marketing Plan
You need a real marketing plan. That’s not hiring some kid to blast your Facebook page with fake reviews about how great your pasta is.
An effective plan focuses on funding a steady campaign designed to bring people to the restaurant consistently – not just on your opening day.
It is not an easy process I can lay out for you in two minutes.
This is so vital to your business, though, so it should not be overlooked.
You can have the most beautiful restaurant with excellent food, but if your target audience does not know (or arrive as frequently as you expect), you are headed for bankruptcy.
Recently, many small businesses think they can succeed without marketing or by doing their promotion and marketing entirely on their own.
So, they start doing mindless shit, like for example, buying a page in the paper and offering some huge discount.
Then you make flyers and tell your 15 year old son to post on Facebook a bunch of times.
Without extensive experience in marketing, just trust a consultant available in your city.
Spend some of your money and hire a professional. You will never spend excessive amounts on their services, and it will always be cheaper than wasted money on personal marketing approaches.
An effective consultant can quadruple, or better, the daily expected income.
I would tell anyone to hire this individual before they even open the shutter on their business for the first time.
Starting off on the right food can not only be more profitable for you, but it can also keep you from wasting the profits you stand to make.
You can trust me, I see these things every day.
9. POS System
The ninth thing you need is a nice POS (point of sale) system.
This was, at one point, the system for managing transactions for people to pay their bills. Today, they are more like robotic managers.
These systems allow you to pull useful statistics and reports including what gets ordered most, when those orders happen, what you don’t see, and helps you to keep an eye on your costs, manage coupons and promotions, and manage your orders.
In short, it does a lot for your business.
While it does serve a very important function for your restaurant, I appreciate its available statistics most of all.
This can give you information that you otherwise would not know about your business.
In short, it is an indispensable tool that you absolutely must have.
Outside there are hundreds of different POS, Google can show you all of them. Once you find one you like, contact the companies for a test, do the math, and take what you think is the most efficient.
10. Crazy motivation
The last thing that you need, a vitally important component that money cannot buy, is motivation.
Motivation is the fuel in the engine of your restaurant. Running an eatery (or really any kind of business) requires a lot of motivation and passion – believe me.
To put it in statistical terms, business is 10% of what happens and 90% how you react to those situations.
Waking up every morning and pushing towards your success and goals with the same intensity and focus is almost impossible without staying motivated.
This is even more important when you happen to fall short. Getting up and running again is never going to happen without motivation.
Believe me, you can even start your own restaurant without experience and become a multimillionaire, but will never get there without motivation.
With that being said, I invite you to express your opinions in the comment section below. The more we can share with one another, the better we all can become.
Thank you for reading, goodbye, and good luck!