If you’re thinking about starting an eatery, the first big step is making a restaurant business plan. A good plan helps you get funding for your restaurant, helps you run things smoothly, and sets you up for success.
Many who start restaurants don’t make a detailed business plan because it can be time consuming. But without a solid restaurant plan, it can be like trying to hit a target without knowing where to aim.
It’s also hard to get investors interested in your restaurant if you don’t have a proper plan. And even if you do find someone, not having the right plans, rules, and predictions can make your restaurant fail.
In this post, we’ll give you a breakdown of the different components of a solid restaurant business plan, giving you the tools you need to do well in the food industry.
1. Executive summary
An executive summary is like the teaser trailer for a movie—it grabs attention and gives a quick peek into what’s coming.The restaurant business plan is the part that sums up everything in a nutshell.
It’s like telling a friend about your restaurant idea in just a few sentences.
That’s what the executive summary does for your plan. It introduces the main information people need to know: your mission (what you’re all about), the concept you’re cooking up, how you’ll make it happen, a sneak peek at costs, and the expected money you could make.
This summary is very important because it’s the first thing investors see.
It’s like a “Why should you care?” note that convinces investors your plan is worth reading. So, it’s a tiny powerhouse that can make or break the impression of your whole restaurant business plan.
2. Company description
This section of your restaurant business plan is where you give a full introduction to your company. Begin with your restaurant’s name and location, including contacts and important details. Add your key contact info and briefly talk about your experience.
The next part of your description should focus on the restaurant’s legal status and lay out short-term and long-term goals. Offer a quick market study to show your grasp of local food industry trends and explain why your restaurant will thrive in this market.
3. Financial analysis
Having a solid financial plan is crucial when creating a restaurant business plan. It’s like having a roadmap for your restaurant’s financial success.
To make this plan, it’s smart to hire an experienced accountant who knows a lot about running restaurants. This accountant should understand important restaurant details, like how many seats your place will have, how much customers might spend on average, and how many people you plan to serve each day.
This information is important because it helps you figure out if your restaurant idea can generate enough money to cover costs and bring in profits. It also helps you plan a create a budget and plan costs for your establishment.
Profit and loss statement
Your accountant should make a “profit and loss” statement that predicts how much money you might make and spend in the first few years. They’ll also figure out when your restaurant might start making enough money to cover all its costs – that’s called the “break-even” point.
Plus, they’ll help you plan how much money you’ll need to start and run the restaurant.
Remember, having a strong financial plan is vital. It shows investors that you’ve thought about money carefully and helps you understand the real costs of owning a restaurant.
4. Market overview
The market overview section of your business plan connects closely with the market analysis in the restaurant business plan, which we’ll cover in the following section.
Your market overview should explore the present economic situation that might affect your restaurant, and explain your strategies to overcome them.
Things like location, menu, competition, marketing, and service quality can directly affect your restaurant’s success. On the broader scale, economic conditions, inflation, consumer confidence, government regulations, and cultural trends in the whole economy can also have an impact.
Make sure your market overview covers as many of these influencing factors as possible.
5. Market analysis
The market analysis section of your restaurant business plan should be split into three parts: industry analysis, competition analysis and marketing analysis.
Your industry analysis should answer the following questions. Who are you aiming to attract? What are the characteristics of the people your restaurant will serve?
This section explains to investors who your intended customers are and why they might choose your restaurant over others.
It’s simple to think everyone will come to your restaurant, but making it a reality means looking at your competitors. Which restaurants already have a following in your desired location?
Note things like their prices, hours, menu style, and how their place looks. Then, make sure this section explains to investors what makes your restaurant different from your competition.
Investors will want to know how you’ll get the word out about your restaurant. How will your marketing stand out from others? How will you attract your target customers? What special deals will you offer? It’s all essentially a marketing plan.
Breaking down the market analysis like this helps investors understand how you plan on promoting your restaurant and helps you figure out how to shine in a crowded restaurant market.
The menu is crucial for your restaurant’s launch; it’s the key product you offer. While a final version may not be ready, having a mock-up is important for your restaurant business plan.
Keep it simple. Include a select few items, as too many choices can confuse customers. Make sure to highlight any special “signature” dishes at the top of the list to give customers an idea of your cuisine.
Add your logo and choose a design that fits your style. If designing is a challenge, online resources can help.
Including pricing in your sample menu is also essential. Your prices should mirror the financial analysis, showing your target price range. Menu engineering matters and can help you increase profits over time.
Selecting your restaurant’s location should match your intended customers. While an exact spot might not be certain, you should have a few options in mind.
When explaining potential locations to investors, provide detailed info about each and explain why it’s ideal for your restaurant. Cover aspects like size and the usual customer profiles.
Your chosen restaurant location should align with your target customers. Though a precise spot might not be locked in, you should have a few possibilities.
When discussing potential locations with investors, furnish ample details for each and clarify why it suits your restaurant. Highlight square footage and the typical customer base.
8. External tools
To bring your restaurant dream to life, you’ll need external support. Jot down the names of professionals you’ll use, like accountants and designers. Include software tools you’ll use such as POS systems and reservation systems.
These aids improve your restaurant’s functionality. Clarify to investors the importance of each and their contributions to your venture.
Homebase is an employee management software for restaurants. From smart scheduling, time clocks, payroll management, Homebase is built for full-service restaurants. Use Homebase for free employee scheduling, timesheets, and much more at your restaurant.
In your restaurant business plan’s company description, owners get a quick intro with some details. Your Team section should expand on the restaurant management crew, a key part of your workforce.
Investors understand you might not have the entire team finalized yet, but having a few members is a good start. Use the current talent to highlight the combined work experiences they bring.
10. Restaurant design
In this restaurant design section, you have the chance to impress investors with your ideas. If you lack professional mock-ups, that’s alright. Instead, craft a mood board to convey your vision. Gather images that match your restaurant’s intended vibe.
Remember, restaurant design goes beyond appearances. It encompasses elements like software systems and kitchen equipment.
How to format your restaurant business plan
When working on your restaurant business plan, having different formats to present to different groups can be beneficial. The information needs to remain consistent, but the length and presentation can be adapted to fit different situations.
Here, we’ll cover the four common business plan formats to suit various scenarios.
An elevator pitch offers a brief summary of your business plan’s executive summary. Instead of diving into details, it’s a quick teaser used to spark interest during short encounters. It should last around 30 to 60 seconds, highlighting key points.
A pitch deck involves a slideshow and spoken presentation to encourage discussion and further exploration of your plan. It typically covers the executive summary, using graphs to illustrate market trends and benchmarks.
Some people add sections for upcoming products or samples, but this might not apply to a restaurant plan.
Stakeholder plan (external)
This written presentation details your business model for customers, partners, and potential investors. It can vary in length but should be well-written and focused on an external audience.
Use it to persuade others to engage with your business.
Management plan (Internal):
The management plan outlines operational details for smooth business functioning. Unlike the stakeholder plan, this is for internal use. It includes specifics for owners and managers, written with candor and informality as external stakeholders are less interested.
Conclusion: Crafting Your Restaurant Business Plan for Success
Starting a restaurant is an exciting journey, but without a well-structured restaurant business plan, it’s like setting sail without a map.
Your restaurant plan is your guiding light – it helps you secure funds, manage operations, and pave the way for triumph.
While creating a solid plan may seem daunting, don’t be discouraged. Follow the instructions outlined in this post and see the immense benefits making a plan will bring.
FAQs about Restaurant Business Plans
Why do I need a restaurant business plan?
A restaurant business plan is essential because it helps you secure funding, run your restaurant smoothly, and increases your chances of success. Without it, starting a restaurant can be like trying to hit a target in the dark – you won’t know where to aim.
What’s the most important part of a restaurant business plan?
The executive summary is the most critical part. It’s like a teaser trailer for a movie, grabbing investors’ attention and giving them a quick overview of your restaurant idea, mission, concept, costs, and potential earnings. It’s your chance to convince them that your plan is worth reading.
How do I analyze the financial aspects of my restaurant in the plan?
You’ll need a solid financial plan, which includes a profit and loss statement. It’s like a roadmap for your restaurant’s financial success. To create this plan, consider hiring an experienced accountant who understands restaurant details like seating capacity, average customer spending, and daily customer volume.
This information helps you determine if your restaurant can cover costs and make a profit.
Why is market analysis important in a restaurant business plan?
Market analysis is crucial because it helps you understand your target customers, competitors, and marketing strategies. It answers questions like who your customers are, what makes your restaurant unique, and how you plan to attract them. This analysis is key to standing out in a competitive restaurant market.
How should I present my restaurant management team in the plan?
In the team section, introduce your restaurant management crew. Even if you haven’t finalized your entire team, highlighting the work experiences of current members is a good start. Investors want to see that you have capable hands steering the ship.