Tips on how to write a restaurant business plan
There are things in the restaurant industry that call for spontaneity – for example, a last-minute promo that ties in with a local event or national food holiday. However, for the most part, success in the food and beverage industry can come from lots of planning and careful execution.
Here are tips on writing a restaurant business plan that can help check some of the necessary boxes and prepare you for everything from finding investors to creating a menu and more.
Why you need a business plan?
Even if you are planning to open a small restaurant, a business plan should serve as your blueprint, turning the idea into a document that guides you, your team, and your investors. It does not matter if your concept is still in the earliest stages of creativity, you are looking for additional financial backing, or you have already opened and want to scale. It is important that your business plan should cover all those steps and more. Having that plan in place is integral to success.
Remember that a business plan is not just "a decoration" It's documentation that most investors and advisors consider indispensable.
What to include in your restaurant business plan?
A business plan should include several critical sections for various purposes and audiences.
Your executive restaurant summary serves two purposes:
1. It introduces your business plan, setting the scene for your readers.
2. It is a summary of your entire concept boiled down to the essential parts, so you can share your vision in a way that is quick to read and understand.
A summary of your business should be exciting and include essential elements such as a mission statement, concept proposal, and cost estimates. Bonus points if you can project potential return on investment.
Paint a picture of the type of restaurant you want to open. What is your brand? What kind of menu will you offer? What type of service will you provide? How do you want the restaurant to look and feel? More of this section should outline the key differentiators that will set you apart from the competition.
Team & management summary
Now is the time to describe your organizational structure, including who owns the company, filling other vital roles (such as general manager or executive chef), and how you expect the restaurant to run. It should be more than just a list of names and titles. It should include a short bio for each person and a nod to their accomplishments.
Market analysis can be a complicated process, primarily because you are analyzing three separate but overlapping things:
· The industry: It is needed to discern your ideal audience before you can plan almost anything else. Who will eat at your restaurant? Why will these guests want to spend their money at your establishment versus a similar restaurant down the street?
· The competition: Learn from other restaurants – including the successful eateries and those that may have made some mistakes. It is needed to know what hours your competition is open, their menus look like, how they have embellished their interior design, and what they are charging guests for food and drink.
· The market: Analyze what type of marketing exists in your space, how your plans will be the same, and how they will be different.
It is not necessary for your business plan to include the final menu, but you should have a sample menu that reflects your concept and average price point. Include dishes representative of your style of service (street-style tacos vs tableside Caesar salad, for instance). Also, discuss your belief principles and how your business intends to align with them (for instance- Are you sustainable? Are you committed to buying local?).
Use expert tips for creating a restaurant menu to turn your culinary team's idea into a working presentation that sounds delicious but can be tweaked as you get to know your vendors and your audience. A menu should be as close to table-ready as possible, including dish descriptions and pricing.
Marketing and sales plans
How will you spread the word about your new restaurant? It is imperative to create a marketing plan that includes multiple channels – think social media, digital marketing, email campaigns, etc. – and spots with local news agencies for radio, television, and print.
How do you plan to run your business on a day-to-day basis? A restaurant investment plan must include your days and hours of operation, why your location offers a competitive advantage, how you will leverage existing relationships with reliable vendors, and anything else that shows you know how to run a tight (and profitable) ship.
A financial analysis is the essential part of your business plan. This is a great time to hire a financial professional who specializes in restaurants and can help you come up with accurate estimates based on metrics. These metrics might include your max seating, projected check averages, and daily covers. Also, have your food cost calculations, so investors can see how you came up with menu prices and how much you intend to spend on raw goods.
An appendix is a catchall for important documents to include in your business plan but might not fit in the above sections. It can also have supporting documents here, such as crucial graphs and marketing research that help estimates and statements detailed throughout your business plan.
Time to get started!
Opening a restaurant can be a daunting and complicated process. However, by putting time and energy into a comprehensive and strategic business plan, you're doing yourself – and future investors – a huge favor.
For more information on how to start your business off on the right foot with our restaurant POS and management solutions, reach out to eatOS Business Consultant today.