For many people, particularly young entrepreneurs, open- ing a restaurant is considered a dream.
It is an exciting and enter- taining sector and requires an essential blend of creative artistry and an astute business sense to be successful. As a veteran in the food and beverage field and an advisor for many foodpreneurs and investors, I’ve always been asked to summarise the most important issues that an individual should consider when plan- ning to open a boutique homegrown restaurant or café.
No matter the type of restaurant, the planning and considerations are more or less the same. At the beginning of the process, it is essential to consider writing a simple business plan, includ- ing the creation of a unique concept, competitor analysis, site selection, financial projections, staffing and most importantly, the menu
Your restaurant must offer a unique experience. It could be a coffee shop that offers simple, small food bites or a themed buffet concept. Whatever you decide, the environment and vibe within the restaurant must place the guest firmly inside the distinctive experience you’re trying to create. Don’t confuse the guest with a concept that’s disengaged. ‘Everything touches everything else’ in the restaurant business. For example, you wouldn’t use elegant tableware in a friendly chicken concept, or disposable plates in an upscale seafood restaurant. It’s essential to apply a concept to every detail throughout the restaurant, no matter how small. It is a collection of everything and every detail in your plan, from the paint colour, music, choice of furniture, menu design (or QR code nowadays), tableware, and wall hangings. They must all work together. The menu and service level must provide guests with a smooth experience that, when executed well, goes almost undetected because it’s natural and authentic
When developing your business plan, always ask yourself questions and explore the answers: how will my restaurant connect with people? What types of guests am I looking to attract? What is the best way to reach them? What do they do in life? Is the concept created for health-conscious people? Is it aimed at millennials or baby boomers? Is it going to be a full a la carte menu, or a convenient, fast food, value-based concept? The concept you are creating should appeal to your selected audience. Remember that it is virtually im- possible to reach the presumption that ‘everyone is my customer’. It is crucial to define your target audience, and your marketing plan should include and be tailored to this.
THE MARKET AND COMPETITION
One of the most crucial components to look at is the market where you’d like to open your restaurant. It is a vital element of the plan. Cautiously research the demographics to ensure there are enough people in the area or there is enough traffic footfall with the demographic that you believe will embrace your concept. The careful consideration of a strategic and convenient location for your restaurant is key.
A full competitor analysis is essential for every new restaurant opening. It is highly recommended to directly or indirectly check your competitor’s pricing to ensure that you are affordable and not underpriced for the market. you may also check other services the competition offers, such as delivery and online ordering. These are becoming important elements to consider, especially during and post-pandemic. Spend time in the marketplace and frequently dine in various outlets several times to better understand and become familiar with your competition. You’ll quickly define a unique value and selling proposition that will keep you ahead of the game.
Try to be different; this will help your restaurant stand out from the competition.
MENU: GREAT FOOD
The menu is key when planning the opening of a restaurant or any other food and beverage business. First and foremost, you must serve your menu consistently. This is not debatable. Inconsistent products can lead to disappointed guests, bad reviews, and a slumping business. The menu must be simple and easy to execute. Consistency increases guest satisfaction, and therefore encourages regular visits. Always offer what you promise your guests in your menu: freshness, organic, etc. when designing your menu, ensure that you present a unique flavour and taste in a trendy plating style that is Instagrammable.
Hiring the right team is the first step in delivering service excellence and a consistent product to your guests. Your mission statement, ‘the why’, together with the corporate culture that emphasises respect for employees, commitment to your guests, service to the community, and concern for the environment, will guide you when selecting your staff. It’s not enough to hire people with restaurant experience; they should accompany you in your mission and achievement and lead the core value of your business.
Many restaurants don’t succeed for various reasons. It could be the wrong concept idea, the wrong market, weakness of the location, entering the market without properly studying the competition, incorrect menu items, or poor service. Undercapitalisation may be the most frequent cause of restaurant failures. It is crucial to know how much money you need to invest in your restaurant in general, particularly your concept. This is the reason you establish a project feasibility study that highlights the amount of money required to cover your operating ex- penditure. It’s important to regularly assess your ongoing cash needs while the restaurant is newly opening and gaining momentum. It will take several months for your restaurant to break even and eventually become profitable. Being able to support the financial needs during this phase is often the ‘make or break’ challenge that many new restaurateurs can’t overcome. It is essential that entrepreneurs are available for their business and not rely on others to support during this phase. A well-thought-out projection model and the help of a professional advisor can save you from the frustration, negative financial impact, and heartbreak of a failed restaurant. Regularly assess and carefully consider your cash needs and how much working capital you must have on hand ready to deploy.