How Much Does It Cost to Open a Restaurant (+ Checklist)

Dreaming of opening your own restaurant? It’s every foodie’s fantasy. But you have to know what it really takes financially. Starting a restaurant involves so much more than perfecting your recipes—from permits and equipment to staffing and supplies. Restaurant startup costs add up super quickly, sometimes in places you wouldn’t expect.

So, how much does it cost to open a restaurant, really? Here’s a quick overview, or dive into our full checklist and plan like a pro.

TL;DR: What’s the cost to open a restaurant?

Here’s the bite-sized breakdown of what it really costs to open a restaurant:

• Startup costs: Restaurant startup costs usually fall between USD $175,000 and $750,000, depending on your concept and location.
• One-time expenses: Think equipment, renovations, licenses, and getting your tech set up.
• Ongoing costs: Rent, payroll, food and beverage inventory, utilities, and insurance all add up fast.
• Sneaky extras: Don’t forget about things like ADA compliance, trash disposal, and pre-opening downtime.

Money-saving tip: Considering a ghost kitchen? They can seriously cut your upfront costs.

One-time startup restaurant costs

Let’s start with the stuff you only need to pay for once. Think of these as your restaurant’s big upfront investments.

Lease deposit or loan down payment

When you’re renting a space for your restaurant, you’ll usually need to put down a security deposit as your “just in case” fee. It can vary a lot depending on where you are and the amount of space, but expect somewhere between $2,000 and $12,000. 

Thinking of buying instead? You’ll need a down payment, usually around 10% of the purchase price.

Restaurant licenses and permits 

To get everything up and running legally, you’ll need to account for your restaurant licenses and permits cost. Make sure you’ve got:

• City business licenses. These can run anywhere from $75 to $7,000, depending on where you're setting up shop.
• Health and safety permits. Food-handling permits usually fall between $100 and $1,000 to start. 
• A liquor license if you need one. These can range from $300 to as much as $14,000, depending on your state’s rules.

Legal and processing fees

It’s definitely worth bringing a lawyer on board to make sure all the legal stuff is buttoned up properly. Think of them as your behind-the-scenes bodyguard—reviewing contracts, spotting red flags, and keeping your future self out of trouble. 

Depending on what you need, legal help can cost anywhere from $500 to $2,000, but it’s money well spent if it saves you from a major headache (or lawsuit) later on.

Kitchen and cooking equipment

Outfitting your kitchen is one of the biggest (and most exciting!) parts of getting your restaurant off the ground. Small-scale spots might spend around $50,000, while a larger, fully decked-out kitchen could climb past $150,000. 

The good news? You don’t have to buy everything brand new. Snagging high-quality second-hand equipment can be a smart way to save some serious cash without sacrificing functionality.

Dining room furniture, décor, and tableware

Your dining space is where your personality really gets to shine. You’ll need:

• Tables
• Chairs
• Tableware like dishes, glasses and linens
• All the décor details that’ll bring the vibe together

You’ll probably spend around $80,000 decking everything out—that number can swing up or down depending on how fancy (or funky) you want to go and how many seats you’re planning. 

Restaurant POS system and ordering tech

To keep things running like clockwork—handling orders, payments, and inventory—you’ll want a solid Point-of-Sale (POS) system. Investing in a good setup might set you back around $20,000, but it’s worth it for smooth sailing behind the scenes.

Building improvements and ADA compliance

If you own your space or have a long-term lease, chances are you'll need to roll up your sleeves and make some improvements. Remodeling isn't cheap—costs can run from $250,000 to $350,000—but that includes everything from building out your kitchen to creating your guest experience. 

There can also be upfront costs for ADA (Americans with Disabilities Act) compliance, especially if you're renovating or moving into an older space that doesn’t already meet the requirements. 

Adding ramps and accessible bathrooms can definitely add up—sometimes hitting around $30,000. Because of that, some restaurant owners choose to kick things off as takeout-only spots to dodge those big upfront costs and get their business rolling first.

Pre-launch marketing and signage

First impressions matter! If you want to make a splash with your grand opening, you’ll need eye-catching signage and some solid marketing magic. 

Setting aside around $20,000 to $30,000 can give you a strong start, helping you spread the word and draw in those first hungry customers with style.

Ongoing and recurring restaurant costs

Once your doors are open, the ongoing costs of running a restaurant are the heartbeat that keeps your operation working smoothly. Here’s everything to keep in mind.

Rent or mortgage payments

Your rent or mortgage will probably be one of your biggest monthly bills—usually somewhere between $2,000 and $12,000, depending on where you are and how well you negotiate. 

Buying gives you control (and yep, property taxes), while leasing is more flexible but can mean shorter stays. If you go the lease route, try to lock in small annual bumps to keep things steady.

Employee wages, benefits, and payroll taxes

Your team salaries can vary a lot, and smart expense tracking matters:

• Managers usually make about $60,000 a year on average.
• Head chefs usually make about $64,000 a year on average.
• Line cooks and prep cooks are typically in the $700 to $960 per week range.
• Your servers will usually earn minimum wage plus tips.

Don’t forget to budget for payroll taxes and employee benefits. Things like Social Security, Medicare, and unemployment insurance can add up to around 10–12% extra per employee. 

If you’re offering health insurance, paid time off, or other perks (which can help you attract and keep great staff), that’s another chunk to plan for in your budget.

Food and beverage supply

Food and drinks are the soul of your restaurant, and your costs will depend a lot on what’s on the menu. Serving upscale entrees means a higher ingredient bill, while a more casual menu can help you save. Pick a manageable number of items, and cost every single dish. 

If you’re planning to serve alcohol, there are some clever ways to save—like teaming up with a local brewery and getting a satellite license, which lets you sell their beverages without shelling out for a full liquor license.

Utilities

Not the most exciting part, but keeping the lights on—literally—means covering monthly utilities like gas, electricity, water, trash, phone, and internet. Average utility costs for restaurants add up to around $2,500 a month.

Insurance and permit renewals

You'll need insurance to protect your business—covering your building, inventory, and liability—and you’ll also need to keep all your licenses and permits current. 

Think business permits, food handler cards, sign permits, music licenses, even ADA compliance. It adds up, so setting aside around $10,000 a year for renewals and fees is a smart move.

Marketing, PR, and promotions

Getting the word out doesn’t stop after your grand opening—you’ll need an ongoing restaurant marketing budget to keep customers coming in. 

While traditional ads (like print or radio) can get pricey, digital options like social media, email marketing, and Google ads are way more budget-friendly—and sometimes even free if you DIY it. 

Tech and software subscriptions

Nowadays, investing in restaurant tech is a total game-changer for keeping things running smoothly. We’re talking everything from POS systems and online ordering, to reservation apps and employee schedulers.

Prices can vary depending on which tools or providers you pick, but having the right tech can seriously simplify your daily grind. An all-in-one platform can even handle employee scheduling, time clocks, and team communication—all in one place. 

Cleaning, sanitation, and pest control

Keeping your space clean and sanitary is non-negotiable. Regular deep cleaning, proper sanitation, and pest control are all part of the deal. These services are all part of keeping your restaurant safe and compliant (and appealing!).

• A cleaning crew can start from around $90 an hour for small restaurants, creeping up to $1,000 for larger ones. 
• A laundry service for table linens, uniforms, and kitchen towels? That can run you around $200 to $600 a week. 

Surprising or hidden restaurant costs to expect

Ah, the surprise costs. A broken fridge, a leaky sink… all those fun “uh-oh” moments. Miscellaneous expenses can (and will) sneak up, so it’s smart to build in a buffer.

Décor upgrades or repairs post-launch

Even after opening, you might find yourself needing to tackle some renovations—especially if you're in a previously used restaurant space that needs updates. 

Whether it's refreshing the look or making layout tweaks, post-opening improvements can cost anywhere from $5,000 to $100,000.

ADA upgrades and compliance fixes

Didn’t catch every compliance detail before opening? You might need to add ramps, adjust restrooms or update signage, sometimes to the tune of tens of thousands.

Trash disposal and sanitation plans

Things like regular trash pickup and grease trap cleaning aren’t glamorous, but they’re part of restaurant life—and they’ll show up as monthly bills.

Security deposits or inspection delays

From utility hookups to permits, upfront deposits and surprise inspection delays can stall your timeline. Err on the side of: “This will probably take longer than I think it will,” and budget accordingly.

Pre-opening staff training and downtime

Training your team properly before opening day is super important and goes a long way to boost morale, but of course it costs you more money in the beginning. You’ll be paying wages before revenue starts rolling in, so plan for that lag.

Considering a ghost kitchen or pop-up to start?

If you're searching for ways to cut down the cost to start a restaurant, you might want to go the ghost kitchen or pop-up route. Ghost kitchens let you:

• Cut rent costs by ditching the dining room
• No furniture, no décor, no signage 
• Trim your team since no servers or hosts are needed, making training and management cheaper and less complex
• Cut down on utility bills (no dining room to heat or cool!)
• Keep it simple with easier permits focused just on delivery
• Skip pricey tableware and all the cleanup that comes with dine-in
• Put your energy into online buzz and delivery

So if you’re googling “how much do I need to open a restaurant” and trying to keep costs down, ghost kitchens are a solid alternative. They let you keep things simple, run a tighter ship, and potentially see a quicker return on investment.

Restaurant startup cost checklist 

Alright, you’ve soaked up all the juicy details… ready to tackle your restaurant’s startup budget like a boss? Time to work through this checklist.

Your restaurant startup cost checklist:

☐ Commercial space

Figure out how much you’ll need to lease or buy the perfect spot for your restaurant’s vibe and foot traffic.

☐ Renovations and décor

Set aside enough to fix up the space and create an atmosphere that’ll keep guests coming back.

☐ Kitchen supplies and equipment

Plan for the essentials — stoves, fridges, pots, pans, and all those must-have tools to get cooking.

☐ Restaurant technology

Don’t forget the tech! Budget for POS systems, online ordering, reservation apps, and other tools to keep things running smoothly.

☐ Licenses and permits

You gotta stay legal! Cover fees for all the necessary licenses and permits so you can open without a hitch.

☐ Marketing

Get the word out! Budget for ads, social media, and anything else that’ll bring hungry customers to your door.

☐ Insurance

Protect your investment with all the right insurance: include liability, property, and employee coverage.

☐ Restaurant labor costs

Factor in wages for your rockstar team. Chefs, cooks, servers, managers… make sure you’ve thought of everybody.

☐ Rent and building fees

Cost out your monthly rent or mortgage payments, plus any extra building fees like maintenance or property taxes.

☐ Food costs

Estimate how much you’ll spend stocking up on ingredients to make those delicious dishes. It’s worth separating the first bulk purchase of food and beverages (including alcohol, if you’re serving it), since this can be a big one-time cost.

☐ Utility costs

Electricity, gas, water, trash pickup, phone, internet — these bills add up, so don’t forget them!

☐ Payment processing fees

Budget for the small fees that come with accepting credit cards and other payment methods.

☐ Contingency fund

Set aside 10–20% of your total startup budget for unexpected costs — equipment delays, surprise repairs, etc. — something always comes up!

‍

Falling short? If your budget’s feeling tight, consider your options:

• Ask friends and family for support
• Apply for a small business loan through a bank or lender
• Look for an investor or partner to help fund your vision
• Explore crowdfunding platforms to rally support from your community

Get creative, make a plan, and get closer to opening day—one step at a time.

Simplify hiring, scheduling, and payroll from day one

Once you’ve got the big-picture costs in check, you’ll find yourself zooming in on one of your biggest ongoing investments—your team. 

That’s where Homebase comes in. We’re an all-in-one app used (and loved!) by thousands of restaurants.

With Homebase (which you can try for free), team management is way more efficient from day one. Here’s where you’ll save time and money:

• Simplify hiring from the start. Homebase helps you post jobs, track applicants, and onboard new hires efficiently, so you can build a strong team without wasting time or money.
• Smarter scheduling that saves on labor. Homebase makes it easy to create and share schedules, track hours, and forecast labor costs, helping you avoid overspending.
• Payroll made easy. Homebase takes care of payroll calculations, tax filings, and payments—even if your team includes hourly, tipped, or part-time workers.
• Built-in time tracking. Homebase turns any device into a time clock, helping you prevent early clock-ins, unapproved overtime, and missed breaks.

Starting a restaurant is expensive—but managing your team doesn’t have to be. Homebase helps you stay sane, on budget, and focused on making your restaurant all it can be. 

“Homebase helps us run a much smoother operation amongst our always changing and growing market & restaurant – with key elements of scheduling, time cards, internal messaging, and documenting cash tips. It makes these critical pieces of the operation much easier to keep organized and current."—Ashlea Hogancamp, owner of Herban Market

How much does It cost to open a restaurant FAQ

‍What is the typical cost of opening a restaurant?

Opening a restaurant usually runs anywhere from $100 to $800 per square foot, with the sweet spot landing around $450. That number can swing a lot depending on where you’re opening, what kind of vibe you’re going for, how big the place is, and what kind of gear and materials you need to bring it all to life.

‍What licenses and permits are required to open a restaurant?

You’ll need a few key permits to get started—think business license, food handling and safety permits, and a building permit. And if you’re planning to serve booze, you’ll need to add a liquor license to the list too.

‍What are the costs before opening a restaurant?

Before you even open your doors, you’ll likely spend somewhere between $5,000 and $20,000 on pre-opening costs. That usually covers things like marketing buzz, hiring your team, training staff, and getting everything prepped and polished for day one.

‍How should I plan my restaurant's budget?

Your budget should cover the usual suspects—rent, food and drinks, staff pay, marketing, insurance, and all those licenses and permits. Keep an eye on your numbers regularly and be ready to tweak things as your restaurant grows or the market shifts.

‍Is opening a ghost kitchen cheaper than a dine-in restaurant?

Yes, opening a ghost kitchen is typically much cheaper than starting a dine-in restaurant. With no need for a dining area, furniture, or front-of-house staff, you can save significantly on rent, build-out, and ongoing labor costs.

‍