how to write a restaurant business plan article

Describe your pricing and how it compares to similar businesses. Describe your restaurant concept and get the reader excited about your idea. You’ll also discover other valuable insights through these discussions. how each supplier serves your restaurant’s needs, Your restaurant will need insurance coverage. List your suppliers by type: food, payment, alcohol, cleaning, etc. Long-term goals are larger, like how you plan to scale your business and how you hope to grow. Just as Rome wasn’t built in a day, know that your business plan will take time. Knowing the answers to these questions will make writing your business plan and communicating your vision a hundred times easier. Why should people choose your restaurant over another? Learn how to choose a creative name for your restaurant. What a Plan Can Do for You A restaurant business plan needs to be structured like most business plans, but the details need to address your specific vision for a restaurant and its place in your local market. Before you start writing your business plan, here are some tips to make the process easier. Describe anything else you’ll be selling, such as pre-packaged foods, canned or bottled drinks, or retail items such as t-shirts and hats. Collect materials that are relevant, like links, articles, quotes and information that may benefit you as you are writing, and use them for inspiration or include them within the appropriate sections of your business plan. After you determine your differentiators, you’ll know how your restaurant can fill potential gaps in the marketplace or provide a better option for customers. List all suppliers for the following: Your restaurant will need insurance coverage. You need to know your target customers. Here on Bplans, we’ve got a great guide already on how to write a traditional business plan . You should have a clear idea of what kind of restaurant you’re opening, whether it’s an intimate cafe, craft microbrewery, or gourmet food truck. Take the time to list these as challenges, provide rationale as to why your restaurant will face these barriers, and how you’ll tackle them once you’re open. In this section on how to write a restaurant business plan, we’ll get into your strategy: how you’re going to price your meals, how you’ll position yourself to appeal to your target customers, and how you’ll promote your business to let customers know you exist. Your Business Description is where your restaurant comes to life. What will you be offering the market that your customers wouldn’t be able to get anywhere else? What other businesses are located in the area? Your restaurant business plan is going to be a long document. What are the demographics, psychographics, and segments of your target market? Include anything that relates to the demand for your business, social or economic factors, and trends that have affected similar businesses. Be as specific as you can in your vision, and be clear on exactly what you want to achieve. Make sure to talk to people within your target market to gain a clear understanding of their needs and how you can serve them. How Much Does it Cost to Open a Restaurant? Know who you're presenting your business plan to and write your executive summary accordingly. Are you confident in your vision, clear on your goals, and comfortable with your skills? Trade name of business (doing business as), Business address or potential business address, Banking details (branch and banker’s name), Restaurant supplies like dishware and glass, Technology, such as EPOS hardware and software, mobile delivery apps, loyalty apps, and an internet provider, Controllable costs: Food and beverage costs as well as cost of labour. Your mission statement is one sentence that describes what your restaurant will achieve. A restaurant plan shares a lot of similarities with a standard business plan. You’ve now arrived at the most important – and the most daunting – part of your restaurant business plan. Consider and document all effects that the location will have on your business, like access to parking, public transportation, walk score, etc. Go through the business plan template the first time and make tons of notes for each section, then come back to it later and flesh out your ideas further. You may be an amazing chef and create exceptional dishes, but without customers and sales, you don’t have much of a business. Are you approaching investors and lenders, or is your plan specifically for you and your staff? Your Business Plan Summary should tie the whole message together. Refine and rework. If you’re in the early stages of planning, you likely don’t know your exact address, but nailing it as close as you can will guide you in your writing. Use this section to highlight how you’re different and what you’re offering, reiterating the most important points about your restaurant. If you’re confident you have the skills, feel free to start. Your restaurant concept is your idea. Categorise your competitors into “direct” and “indirect”. RestoHub tells you everything you need to know to open a restaurant. If you are going to offer catering or other services, you can create another revenue stream that covers events executed, average spends, revenues, cost of goods sold and labour costs for that source. If you’ve done research or hired a firm to conduct some for you, mention all the outcomes from that research here. Have you worked in the restaurant industry before? You should know exactly what your venue is going to be as you work through the details of a business plan. Briefly sum up everything that you’ve talked about in this section, reiterating the demographics of your target market, advantages, and opportunities. In this article, I’ll dig into how to write a business plan specifically for a restaurant—the changes and additions you’ll want to make so your plan is customized enough to be truly useful. Check your local government website for the details and anything else that you are required to obtain in your area. What will your restaurant do that no one else is doing? If you are planning to open a restaurant that will serve alcoholic drinks, you will have to figure out your sales mix of the various types: bottled beer, draft beer, liquor, and wine, and the costs associated with each. List your competitors’ prices and explain why yours will be higher or lower. List statistics you’ve gathered about your market and any other relevant information about your potential customers. Visit your direct competition and gain some intel on their customer experience and menu. The most important thing to remember about this section is that you’ll need to remain honest and authentic. Here’s where you get into the nitty-gritty details of your business operations. Collect materials that are relevant, like links, articles, quotes and information that may benefit you as you are writing, and use them for inspiration or include them within the appropriate sections of your business plan. The Executive Summary is a one-page summary of every section in your business plan, so that readers can get a general sense of your entire plan in one page. As time passes and you continue to work on it, you’ll fine-tune your message and have a crystal clear plan on your hands. Analyse your prospective neighbourhood, and make a list of all your competitors from small to large. Which features of the neighbourhood will affect your business? Now that you’ve analysed the competition, you should be able to spot how you’ll be able to stand out. This can be a short paragraph. This section should provide a quick overview of the size of your customer base. Your Business Description answers all of the questions that relate to your vision and goals. How will you communicate your differentiators to your market? Everything. If a section stumps you, make a note and move on, then revisit it later when you have more information or more clarity. By writing a restaurant business plan, you show investors or lenders you have a clear contingency plan for handling any problems that arise. Finally, briefly sum up everything in this section. You need a marketing strategy to get people in the door and coming back. Your restaurant’s location will determine important elements of your business plan, like your competitive analysis, ingredient availability, venue type, etc. It’ll look something like this: After you’re finished writing your restaurant business plan, make sure to review your table of contents so that your page numbers are accurate. Now, the other side of the coin: what your restaurant may not be able to do better than the competition. Do a thorough analysis and include all of the demographic information you can, everything from age and income to their values and what they expect from the restaurants they already frequent. Notes about the forecast spreadsheet. Who is involved and what is their role? Categorise each staff member into other owners, chefs, managers, servers, bartenders, etc. So you know other restaurants are your competition, but you’ll need to be specific. While the Executive Summary may live at the beginning of your business plan, it’s the last thing you’ll write. Business description summary Are you looking to open a burger place with a constant flow of customers? A step-by-step competitive analysis for your new restaurant. A thank you: a quick thanks at the end reminds people that you value their time and input. You need a business plan before you can begin to execute on anything having to do with opening your establishment. Use your differentiators in the previous section to guide your positioning strategy. Or maybe you want to be the go-to place for special occasions. Have a passion for food and bringing people together? Note how each supplier serves your restaurant’s needs, and list their credit and payment terms. This is where a table of contents comes in. Think about who you're going to present your restaurant business plan to and what they're most interested in, and place that information front and center. What are your differentiators that will cause the market to take notice of your business? This section is where you’ll describe the current status of the marketplace for your business. Once you understand the sample forecast, we’ve included a blank forecast sheet where you can add in your own numbers to project how profitable you’ll be. Introduce everyone on your payroll. Complete a financial forecast that takes your concept and translates it into numbers. List all of the licences and permits required for your restaurant and staff here. Your Business Overview is simple: it’s a list of basic information about your business, such as your legal name, type of business, business number, etc. Here is where you’ll describe, in detail, what your business is going to look like, where it will be, and the kind of vibe it will have. Express why these details are important (hint: they should relate back to your branding). Answer the following questions here: Your mission statement should be something that can be displayed on marketing materials, and it should express to people what your business is all about. If you aren’t quite sure, you’ll need to decide before you write your business plan. Define clearly what will be unique about your restaurant. Then, when you are writing your business plan, go back to your boards to pull in graphics that get your idea across better than words. This section requires a lot of research and critical thinking skills. How well do you know the market? Your short-term goals describe your first year as a restaurant owner. Describe your website’s main elements, design style, and who will build it. What kinds of people live, work, or visit the neighbourhood? A restaurant business plan is similar to any other business plan, at least in terms of the actual business plan format. Here’s what to include in your Business Description. Our example is Joe’s Burgers, a small 1,000 square foot quick service restaurant with no alcoholic beverage sales. Why you will succeed: in a few short sentences, repeat how you are different and why your business will work. Who will operate your business day-to-day? You’ll need to adapt your writing for different audience types, and perhaps place emphasis on certain sections over others depending on your primary audience. Will you be holding any events, releasing a press release, or taking out any print ads? Be descriptive in this section, but also remember to remain realistic and within the scope of your projections in the financial section. Who do you envision visiting your restaurant? Your direct competitors are those restaurants that are offering similar customer experiences and type of cuisine, while indirect competitors may be different from your restaurant but still compete for your target market’s attention and spend. Go into detail about the food you’ll be serving, inspiration behind your concept, and an overview of service style. Before you start writing your business plan, you’ll want to consider a few key things. Take the time to describe your concept with as much visual detail as you can. By gathering as much information as you can, your marketplace assessment will be clear and rooted in reality. Now that we have the rules of writing a business plan out of the way, let’s dive into the elements that you’ll include in it.The rest of this article will delve into the specifics of what you should include in your business plan, what you should skip, the critical financial projections, and links to additional resources that can help jump-start your plan.Remember, your business plan is a tool to help you build a better business, not just a homework assignment. If you don’t yet have a location for your restaurant, you should at least know which neighbourhood your restaurant will be located in. Who will frequent your restaurant and what characteristics do they share? fill in what you can as you go. List each type of insurance your restaurant will need and what it covers. Use graphics and images to clarify your message when you feel it’s necessary. Let readers know why you think your marketing strategy will work for your type of restaurant. Describe how you’ll appeal to your target customers and where you will place yourself in the customer’s mind. You need a business plan for investors, lenders, consultants, partners, and other team members who will help make your dream of opening a restaurant come true. Ask people in your prospective neighbourhood about how businesses perform in the area. 5 Tips on How to Write a Restaurant Business Plan Before you start writing your business plan, here are some tips to make the process easier. Be sure to add all new developments that are happening, and when you’re confident you’ve said all you can about a section, go back in and edit and re-word until you’re satisfied. Will your business be run as a sole trader, a partnership, or a company? A comprehensive business plan is the foundation of every successful restaurant. Take the time to describe why your business is special, and talk about what you’ll do differently as compared to other restaurants. List their qualifications, special skills, and job description, with an emphasis on how they will help you reach your goals and the tasks they will do every day. Yes. Your Business Description tends to be a long section, so you’ll need a summary that provides an overview of what you’re going to achieve with your business. If you’re working with a design agency or interior design specialist, mention them and show their proposals or mockups. Depending on the nature of your restaurant, your business plan could be anywhere from 10 to 50 pages – so your readers will need to find sections easily. But if you’ve never spent any time in a kitchen or in the foodservice industry, you may want to get some hands-on experience so you know what you’re getting into. Remember to keep this section brief yet impactful. Briefly sum up everything that you’ve talked about in the Business Operations section. Make sure to align this section with your financials so that your food and labour ratios are taken into account when crafting this section. Provide ballpark figures for different menu items and list standard pricing for your type of business. From the menu to the hours, whatever your restaurant can do better, list it here. It can take anywhere from weeks to months to years to get a solid grasp on what it is you’re creating. This is where you prove that your idea is actually a business that can turn a profit. When you begin to seek professional and financial support for your new business, your business plan will be the primary document of reference to describe your concept, market, and potential for profitability. Think about where you’re going and what you hope to be doing in a couple of years. Expenses: Marketing, rent, supplies, utilities, etc. Be as expansive as you want here – go into as much detail as possible, and don’t be afraid to use visuals! Make a note of any customer segments within your target demographic that have certain needs over others. Here you’ll want to list relevant statistics about past and current trends within your marketplace. What kind of experience will you be providing customers? You won’t do yourself or anyone else any favours by painting an unrealistic picture of the marketplace and how your business fits within it. Do some research to determine mandatory insurance and special coverage, and start to compare costs between insurance providers. Here you’ll want to mention any relevant personal goals, then list your short-term and long-term objectives. You likely won’t have secured a location or negotiated a lease at this point, so instead mention the neighbourhoods you’re considering for your venue. Avoid cliches and superlatives. Don’t be afraid of honesty here; a candid account of the challenges you’ll face will show readers you’re self-aware and ready to overcome problems with practical solutions. Think of your end goal, the ultimate driving force behind your business. What kind of licencing does your restaurant need? Keep the answers to these questions top of mind as you’re writing your business plan. List all paid digital promotion here such as Google ads, paid social media ads, and any agencies you’ll work with to develop and execute on all digital marketing initiatives. A proper business plan is a guide that will help take your idea from concept to reality. You may have some empty fields until you’re closer to actually opening. With few variations, you’ll want to include the same sections and much of the same information, whether you plan to open an upscale steakhouse, a small diner, a catering business, a cafe, a bakery, a takeout joint or a food truck. Take the blank forecast and “save as” so that if you make a mistake, you can return to the original spreadsheet and start again. Use a critical eye to determine how they differ from your establishment. In this article, we’ll walk you through every part of how to write a restaurant business plan, explain the function of each section, and provide an example you can use as a starting point. This list is for quick reference and especially important if you’ll be seeking bank loans or approaching investors: Quick tip: many of the details in your business overview will be filled out as your business takes shape. If you’re going to offer catering, delivery, or any other services, mention those here. Your forecast will be broken into four main parts: We’ve created a downloadable sample forecast that demonstrates what you’ll need to do. Include a sample menu, or menus, and discuss the details of each, such as times of day offered and the inspiration or rationale for each. Start-Up Costs: What it costs to get you to open, as well as things like capital improvements and training. Ready to jump in? There are formulas pre-programmed in the cells of the spreadsheet. But how will you actually execute your plans? Consider creating Pinterest boards to keep you inspired and help you get visual. What you need: if you’re asking for money, repeat the ask here. Do you need any additional skills before you start your restaurant? Taking something from concept to creation can be challenging, but try to put everything you see in your imagination down in the most accurate words possible. If you plan on creating and maintaining social media accounts like Facebook, Twitter, and Instagram, explain how you’ll use them to promote your business. Executive Summary You’ve described your vision, the market, and how you plan to promote your business. Briefly summarise your overall marketing strategy and what you’ll concentrate on the most: digital, traditional, PR, etc. if some of this information is unknown, don’t let it hold you up. An essential question to ask while creating your restaurant business plan is, who are the people that are going to eat at your restaurant? This exercise is the most important part of your business plan, as investors and lenders will be scrutinising these numbers before they read anything else. For example, if your bottled beer cost is 28% and wine cost is 40%, you’ll have an average beverage cost of 34% to add to your forecast. Sentences, repeat the ask here as Rome wasn ’ t let it hold up! 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