Things You Should Know When Starting a Restaurant Businessby Emma L. Business consultant
The problem with entering a restaurant business underprepared lies in the fact that it’s one of the most competitive industries out there. To realize this, you don’t have to be an expert economist or market analyst. All you have to do is take a walk downtown and try to remember which of the places were there last year or several years ago. Still, there are some restaurant businesses that manage to thrive and prosper against such odds. The truth is that the longer you run, the more loyal your customer base gets, which means that this is more of a marathon than a race. Here are five simple methods you need to adhere to in order to drastically improve your odds.
The location matters more than you think
The first thing you need to understand about a restaurant business is the fact that the relocation of a business isn’t such a simple task. You see, the location becomes a major part of your brand and even a person who fails to remember the name of the venue will recommend “that place at…”. This means that if you move, you’ll have to start over. The part of town that you’re situated in will also determine your menu (by examining local competitors). For instance, if there are too many pizza places in the vicinity, including a pizza to the menu might not be the most cost-effective of moves. This is why finding the location for your restaurant business is a permanent decision that you won’t be able to alter in the future.
Do you have enough money to start?
Keep in mind that starting a restaurant requires a serious investment, which is why you need to ensure that you have enough money. Otherwise, an alternative like starting a home-based catering business or buying a food truck may be preferable solutions. On average, you might need up to $500,000 to start, which is why you need to think about fundraising as soon as possible and start developing plans. Nevertheless, whoever is serious about opening a business can’t settle for an average estimate. Instead, you need to do some estimation of your own, which includes factors like annual sales, return on investment, total startup cost and more.
When it comes to investment, you need to worry about more than just money. The quality of equipment and supplies you use is sometimes worth paying more for. Instead of settling for regular quality items, like the ones you would use in your kitchen, what you need to do is look for commercial catering equipment. Remember that the amount of use and the number of work hours that this equipment will see is far beyond anything you’ve ever used privately, which is why even slight differences in performance matter. Start by drawing the list of all you need and then do your research on each individual item. Sure, this is a lot of work but it’s A) for the equipment that you’ll use on a daily basis and B) a purchase that you won’t have to repeat for years to come.
As far as marketing goes, you need to start working on your business’ online presence as soon as possible. First of all, you need a website with a menu, contact info and several pictures of your brick and mortar premises. Next, you need social media accounts that you can use to promote your menu and your latest offers. Finally, you need to find a way to all the local registries, so that people looking for a place to eat have a simple method of finding you. Google My Business and Yelp should be your first two stops.
So far, we’ve addressed this issue over several times, which is completely logical, due to the fact that other than your venue, it’s the determining factor of the popularity of your place and, therefore, the sales. First of all, you need to ensure that the menu is appealing to your target demographic which means that you have to identify and analyze this group. Second, you need to find an adequate supplier and ensure that the preparation of this dish is cost-effective enough. After all, running a successful business depends on your ability to make a profit from your products.
Sure, this is far from all you need to know in order to run a successful restaurant business but it’s more than enough to get you a much smoother start. Truth be told, you need all the advantage you can get and this just might be enough to give you a slight competitive edge.
Created on Feb 28th 2019 11:04. Viewed 275 times.