Are you planning on starting a restaurant? Then, assuming you haven’t already one, it’s time for a business plan.
A business plan gives you the chance to evaluate the restaurant’s concept, decide which customer group you should be targeting and make a realistic evaluation if there is demand for your Big Idea.
Stick with us for some tips to make sure your business plan hits the mark:
1. Find the perfect concept
Whether you’ve identified it or not yet, having a concept is vitally important. What do we mean by having a “concept”? It’s basically your USP (Unique Selling Point), describing how you plan on differentiating your restaurant from the competition. Is it to provide exclusive cuisine? Or an affordable lunch restaurant? Or maybe it’s to be the only Thai/Hungarian fusion restaurant in town. (Yes, that is a thing.)
‘Whatever your concept ends up being, your business plan is the perfect tool to go deep into the concept and make sure it’s the right concept at the right time and the right place to really stand out from your competition.
2. Know your competition
Just like any journey of self-discovery, once you know yourself, you need to get acquainted with those around you. By this, we mean conducting a thorough analysis of the market and your competitors to better understand who you are going up against.
It can also be helpful in fine-tuning (or even changing) your concept to better fit your market. For example, if your concept is to serve the best meatballs in the city, thn knowing that there are two other restaurants in the vicinity with a similar niche is really important. If you are confident your meatballs are the best in the world and easily outclass the competition, then go for it. If not, it might be time to re-evaluate your USP.
3. Identify your target customers
Your business plan also gives you the opportunity to identify who your restaurant’s target customers are.
Do you want to run a place where people come to have a beer and watch the match after work? Or to be the first restaurant someone thinks of when it’s a special occasion and they want a fancy, three-course meal? Your target clientele—and how you reach them—is going to be completely different.
Identifying your target customer again comes down to focus. You can’t be all things all people. If you’re trying to be the newest, trendy, hyper-popular establishment, you’re not likely going to also be the place where all the city’s senior citizens come for lunch.
If you target too broad a potential customer base—or choose a concept that is too broad (“the restaurant for people who like to eat food!”)—you risk having no real identity.
Instead, go all-in with a specific group of guests who are craving your concept and make yourself irreplaceable to them.
4. Prepare a proper budget
The budget. This is where many people fall down in making their business plans. Many make the mistake of creating a light version that doesn’t really fulfill its purpose or, worse, not making a budget at all.
You may think you already have all the prices and costs of production in your head (or written down on a piece of paper somewhere), but for a serious business setting out to make a profit, this is not enough.
When writing your business plan, it needs to include a clear budget that specifies raw material costs from suppliers, how you much you should sell them for and how much you expect to earn. It is important to be thorough. Cost of goods is more than just their purchase price: rent, staff salaries, cost of utilities, just as several examples, all need to be accounted for in calculating your costs.
What your restaurant business plan should include:
- Restaurant concept
- Analysis of market demand and supply
- Identifying potential competitors
- A marketing and sales Plan
- Basic budget
- Goals for the business and a plan for how to achieve them