You must write a complete business plan detailing every detail to the maximum to adjust it to reality. For example, sections such as business structure, personnel, finances, target customer, and average ticket must appear. A business plan is necessary for any economic activity, and restaurant have the advantage that most of them are scalable or easily known costs. On the other hand, restaurants are hard to run and keep profitable with a lot of competition, so it’s important to plan.
WHAT IS A BUSINESS PLAN?
A business plan describes a company/freelancer’s values and goals and how they plan to achieve them. It is essentially a roadmap for your business. Business plans can be used to establish benchmarks for your restaurant and help you when applying for financing from investors or financial entities or when requesting activity licenses from the City Council.
WHY DO YOU NEED A BUSINESS PLAN?
A business plan for your restaurant is essential to detail the important factors that differentiate your restaurant from other premises, ensuring business success and that all operational and responsible processes are perfectly detailed.
In addition to investors, we recommend sharing it with the restaurant’s management team to make them part of your project. The City Council technicians who process activity and liquor license authorization will sometimes ask for a copy. You may also need that business plan to attract and sign the chef or a renowned sommelier/head of the room. They will ask you for all this information to contrast your business project.
SECTIONS OF THE BUSINESS PLAN FOR A RESTAURANT:
The sections I added will depend on how much you want to develop your business plan. The standard includes the following:
- Executive Summary.
- Legal aspects of the company.
- Market analysis and competition analysis.
- Operations and marketing.
- Management and ownership.
However, each business plan is different, it can also vary depending on the budget available, and you can even have a plan depending on who wants to present it. When writing a business plan, things like a sample menu, restaurant layout and furnishings, location, and economic and financial analysis are often included. Likewise, the sections you add depend on how much you want to develop your business plan.
They also often include a marketing section. We recommend making a brief comment on the restaurant plan to serve as a reference to develop a more specific restaurant marketing plan later.
HOW TO CREATE YOUR BUSINESS PLAN?
If you are considering opening a restaurant, starting a business plan is the first step. Starting it or abandoning it when you detect it is not viable. You may not have all the details yet, but it can help you see where you need to expand and improve certain areas.
Let’s look at the main components of a business plan and what information you should include when you start to put together your restaurant business plan.
We will start with your restaurant’s mission statement as well as the general concept of your restaurant. Concepts include the brand, what makes your restaurant stand out from the competition, the type of food, service, and the visual image and experience it intends to convey.
Since a business plan is also used to present to investors, this section would be the one to convince the investor why your restaurant is a good investment, successful, and with a high return on their savings.
The extension for the executive summary is one page.
LEGAL ASPECTS OF THE COMPANY
We will explain all the legal information of your establishment. Include the fiscal name, contact information, and physical address. You must also provide the owner’s name and any history or relevant experience of the owner in the industry to demonstrate the viability of your restaurant.
This section should also briefly develop the objectives of the restaurant. In the short, medium, and long term, it would be science fiction and more with the times we are living in, not to set goals that are not realistic. It also explains the socio-demographic data of the target customer. You can also mention things such as the structure and personnel of the business and the legal-fiscal situation of the restaurant, plus the licenses acquired.
MARKET ANALYSIS AND COMPETITION ANALYSIS OF YOUR RESTAURANT
The market and competitor analysis can be divided into two individual sections or written together. They cover similar topics, so you decide if you combine or separate them (we recommend separating them for your plan and combined for those plans that are for third parties).
A market analysis looks at the target audience of your restaurant and who your customers will be. First, consider your target audience and why they will choose your restaurant first over others. Next, you must analyze the restaurant’s environment (offices, supermarkets, gourmet stores, etc.) in your area of influence and how the restaurant will be integrated into that neighborhood or city.
A competitive analysis should look at other restaurants in the area and how your restaurant will compete, though we prefer to say differentiate.
- Are there restaurants similar to your concept, or will they be unique in your neighborhood?
- What prices do the other restaurants charge?
- What clients do you serve?
You should try demonstrating how your business will stand out and be more competitive than other restaurants.
The market analysis section can also include a marketing plan. This is a good place to explain how you will reach and engage your target customer. For example, developing restaurant promotion plans to attract customers, sales strategies, etc. You may also have a detailed marketing plan later in your business plan.
This section is also sometimes referred to as “Products and Services.” Here, you must indicate what services or specialties your restaurant provides. Some of the items include:
- Opening times.
- The number of employees, hierarchical structure, functions, shifts, etc.
- Service types (cuisine style, fast food, home delivery, luxury, getting a Michelin star, etc.)
- Licenses of activities available or necessary in the future.
- Will you buy from local suppliers or large distributors to centralize purchases?
The business operations section can cover certain logistics and how your business will benefit customers and residents of the neighborhood or city. Specify that your business wants to link with the city, establishing collaborations for a greater reputation of the city, both nationally and internationally.
MANAGEMENT AND OWNERSHIP
Here, you can expand further into the structure of the restaurant. You are most likely the owner if you are writing the business plan. Explain what you, as the owner, will be responsible for and take care of.
You can explain to the rest of the management team who will be responsible for what tasks. If you have partners or other directors hired, explain their functions and experience to see the project’s viability. If you haven’t hired your management team yet, simply explain the different positions and what they will be responsible for.
Having a clear structure that shows who is responsible for what and who reports your work is important. Set the circuits for good communication and show outside investors that your business will run like clockwork.
This is probably one of the most relevant sections of your plan, as investors will primarily look at the numbers. We recommend doing it with your manager’s help to gather all this information and make it relevant. This will help you and investors better understand your restaurant’s reality. Do not use the manager only for accounting. They are also informed on laws, entrepreneurship aid, etc.
To make financial projections, you’ll need to know the average ticket for your project, the number of people you can serve in a day, and how many guests you expect to have per day. Consider the fixed costs, labor costs, and raw material costs, as well as the margins of the articles of your establishment.
MENU AND CARD
This section is specific to a plan for restaurants. Your menu/dishes/wine list does not have to be permanent. We are referring more to the type of food you will serve and the cost per dish.
Providing a menu helps to complete the financial information due to the type of food, variety of menus, the possibility of reserving the restaurant for private events or companies, etc. An example, specifying whether there will be a lunch menu during business days and a special one for the weekend, menus for groups, etc., allows one to get an idea of an income statement. Use the food price tag to make sure menu items are priced appropriately. It is also convenient to expose the design and aesthetics of all these services to create a brand image. Include your restaurant logo if you already have it.
General location information should be included in the market analysis. Perhaps add more information about the location in this section or more detailed information, such as a report on works or future renovations.
In case you have thought about opening a restaurant, and you do not have a chosen place, we recommend you do a research job on different places. And zones. However, you should research the neighborhood or neighborhoods you are looking at and show that your restaurant would be successful there. A clear example is in the city center, in a peripheral neighborhood, or, more exaggerated, outside the big city. Look at the demographics of who lives, works, and dines there to show that the target customer is there.
Do you have a business plan but need help doing the marketing? We will be very happy to help you in your restaurant and take your restaurant to where you would not have imagined.