Business plan to set up a restaurant

Food is a frequent topic of conversation, and initiatives have multiplied around it in recent years: shows, fairs, television programs and contests, thematic channels, specialized magazines, etc.

Without a doubt, setting up a restaurant has great attractions. Properly managed and with a good public relations policy, it can become a new option in the local leisure scene. Today as never before, the profession of a chef is especially valued, and if our skills are mainly culinary, we can aspire, why not, to stardom. From the economic point of view, in the most successful cases, a return of 25% has been achieved – it is more normal to expect a return of between 15% and 20%.

Although setting up a restaurant also faces a series of difficulties, hospitality activities require a lot of sacrifice and dedication, and it is necessary to think deeply about our current and future availability. That’s why it is important to go with a restaurant business plan. In addition, the location is of special importance. On many occasions, it is difficult to find a place that is not only suitable for our target audience but also meets the legal requirements of licenses and authorizations and whose price is within our reach. In addition, a large initial investment is required, which can discourage more than one. Finally, one of the most pressing problems in the hotel industry is the difficulty in finding qualified and motivated staff – despite the hours required by profession.

Before starting

Setting up a restaurant is a decision that must be properly matured, carrying out an in-depth prior investigation. Sector, trends, customers and local market, competitors, suppliers, purchasing channels, and legislative aspects are the main issues that must be discussed.

It is also necessary to conduct a very sincere internal analysis to know what we can do with our resources (financial, technical, human, etc.). A good preliminary study and knowledge of our target audience will allow us to define our business concept, structure, positioning, location, and marketing mix elements in the most concrete way possible.

7 keys to the success of a restaurant

1. Service

 Determinant when shaping the experience and the final perception by customers needs to be detailed in an action protocol.

2. Letter design

 It is a powerful communication and sales tool. Without photographs, the chef must intervene in their preparation with visible, most profitable dishes and references to allergens.

3. Environment

 The style and decoration of the restaurant must achieve an atmosphere by the business concept and the target audience.

4. Prices

 The key to getting prices right is to combine the value perceived by the customer, the local market situation, the profile of the chosen clientele, and the costs of raw materials.

5. Communication strategy

You have to quantify objectives, focus on the target audience, establish an adequate budget, and measure and control. The communication strategies most used by restaurants include:

• Advertising and public relations.
• Digital presence (web and Google My Business).
• Attraction strategy on social networks.
• Geolocation.

6. Loyalty

Having unconditional fans who repeat over time and bring new customers is a goal.

BUSINESS PROFILE: BEGINNING BALANCE

Our entrepreneur intends to start a family restaurant of about 90 m2 in a relatively central area of ​​Malaga. However, the place is rented, and it is necessary to undertake reform to its condition.

The following investments in tangible fixed assets are planned: refurbishment and refurbishment of the premises ($30,000), catering machinery ($10,000), kitchen tools and utensils ($5,000), furniture and decoration ($10,000), and computer equipment ($2,000).

For more information, please visit: https://www.mbplans.com/

BUSINESS PROFILE: INCOME STATEMENT

Bills

Our entrepreneur, in addition to managing the activity, performs the functions of a chef. Framed for the first time in the Social Security self-employment scheme, he pays the monthly Social Security contribution fee of 60 dollars (“flat rate”) during the first twelve months of activity. His gross salary is $24,000, with 10% personal income tax withheld. The three workers – waiter, assistant waiter, and kitchen assistant – have a gross annual salary of $15,000, with an average withholding (IRPF) of 10% and a Social Security fee of 6.35% of the monthly gross, including the proportion of extra payments. The fee charged to the company is 30.0%.

Sales

Our restaurant will have 10 tables with a capacity of four people each and a maximum of 30 people. There will be two shifts for lunch at noon on weekdays (menu at 10 dollars) and one for dinner at night (average price per dinner of 25 dollars), and it will open every day of the week, except for the national holidays, for a total of 22 working days per month. It has been assumed to start the first month with an occupancy of 35%. After that, an occupancy will start low at the beginning and grow month after month as customers get to know it, resulting in average occupancy of 48.8% for the first year.

Cost-effectiveness

For a restaurant to be profitable, it is necessary to monitor the proportion of purchases, personnel, and general expenses. They are recommended not to exceed 25%, 35%, and 25%, respectively. In our case (see the last column “% of Sales”), it would be convenient to take corrective actions on how we plan to buy and personnel expenses – are we not oversizing the necessary workforce at the beginning? From a service point of view, it seems reasonable to set an average of 20 covers per hour per waiter, which gives us an average of a waiter responsible for five or six tables with four seats each. As for the kitchen, a chef can serve 15 or 20 people. Likewise, it will be necessary to try to reduce each one of the chapters of general expenses. And, above all, try to improve the gross margin (sales minus cost of sales). The key to success lies in achieving a high occupancy of the establishment and controlling fixed and variable expenses so that they do not skyrocket and the contribution.

Click here to read more articles.