How to write a business plan for your new restaurantSmall Business Advice 2 January 2018
It’s no secret the restaurant industry isn’t easy to break into – but having a solid business plan means you can put your ideas in place, outline your goals, and create a firm foundation to launch your business with confidence and direction.
Not doing your due diligence here could mean serious problems down the line.
There are plenty of things to take into consideration when writing a business plan for your restaurant. We’ve outlined why having a detailed plan is important and which elements you should include in it, to help set you up for success.
Why should you write a restaurant business plan?
A business plan can be the ultimate guidebook to your restaurant, including everything from branding and future objectives to financial details and operational logistics. It can help you to accomplish a whole host of things:
- Turn your dream into a reality: It gives you an opportunity to define your restaurant and brand in an organised way. You can get your ideas down on paper.
- Think about the difficult aspects: Putting together a plan forces you to learn about the wider industry and decide whether your restaurant has a chance of being successful.
- Stay on track: Create a set of measurable goals that you can refer back to, so you can reflect on progress and adapt your objectives accordingly.
- Sell yourself: Having a professional plan is vital if you want to apply for funding from investors, or if you’re looking to recruit a business partner.
What to include in a restaurant business plan
The contents of your plan will be unique, depending on your business and who the plan is being presented to. However, there are a few key things every restaurant business plan should include.
- Executive summary
This section should define your restaurant. It should be fairly brief (no more than a few pages) but allow the reader to understand exactly what your restaurant will be like and why it will be a success.
Write a description that summarises the core of your business and the rest of the plan, such as:
- What sort of food you’ll serve.
- The type of style and atmosphere it will have.
- Your USP (unique selling point).
- Where your restaurant will ideally be located.
- How it will be run, including hours of operation and any unique operational features or elements.
You should also include:
- A mission statement, in which you outline the core values of your restaurant.
- Your business objectives, where you provide a brief rundown of what you want to achieve.
You might also want to include a sample menu that demonstrates everything from design and branding to the type of food you’ll serve, with prices and any additional factors that your unique idea will include (such as where ingredients are sourced, dietary info etc.).
- Branding and marketing
Give a complete overview of your restaurant’s brand, including the inspiration and story behind your ideas and what makes it different from existing establishments. You might want to include a mood board, along with images or sample graphics.
You should also outline how you’ll attract people through the front door. Explain your plans for your website, along with how you’ll approach digital and traditional marketing. Give an outline of your promotional strategy, including any regular deals you’ll offer to customers.
- The marketplace
This section should define two main things: what’s happening in your target market and in the wider industry.
- Target market
Create profiles of your customers that explain who they are, what they like to do, what sort of income they earn, and why they’ll choose to eat at your restaurant. Conduct market research and interview people, so you can include feedback that hopefully shows we’re on the right track.
- The wider industry
Give a comprehensive overview of the state of the industry, on a local and regional/national scale, and explain how you fit in, in terms of growth and positioning. Explain who your competition is and why your establishment will bring something new to the marketplace.
- Business operations
Outline the administrative and logistical details of your business, including things like:
- Any legal terms: If you’re the sole proprietor or a partner.
- Facilities: Where your restaurant will be located.
- Expenses: Such as rent, utility bills, and services you will outsource.
- Equipment needed: Cooking appliances, kitchen supplies and furniture.
- Supply: Where and how you’ll source ingredients.
- Licences: Which permits and licences you’ll need.
- Staffing and service
Explain the staffing structure and the way you plan to run your restaurant. You should give a breakdown of how many people you’ll need to hire for each role (servers, kitchen staff, bartenders, delivery drivers etc.) as well as plans for who will manage the establishment.
It’s also an opportunity to explain your vision of how the restaurant will operate, especially if you have a unique approach.
This section should offer a detailed overview of how much it will cost to run your business, along with the predicted cashflow and sales projections. If you’re not confident about putting these figures together, seek professional help from an accountant.
Your running costs should take all expenses into account, including:
- Rent and bills.
- Cost of equipment.
- Cost of food and beverages.
- Salaries and wages.
- Permit and license fees.
- Marketing/PR costs.
When looking at predicted sales, think about the number of seats you have in your restaurant, how many customers you’ll serve each day during your opening periods, and what the average bill might be. This should help you figure out how much you’ll earn in a typical week. Try to be realistic.
Based on your running costs and your predicted sales, you should be able to work out when you can expect your restaurant to begin making money, or if there are changes that are needed to make it work.
Writing a professional business plan will help you to organise your thoughts and put the dreams you have for your restaurant into a physical document. You can expand on your ideas and work out the financial and operational details, so you have a concrete idea of how things will work.