Restaurant Business Plan
Owing to changing lifestyle and volatile demographics there has been a surge in the food service business. Busy consumers are demanding greater convenience when it comes to buying their meals. Flavoured breads without the hassle of baking, nutritious tasty meals without dishes to wash underlines clear demands that lead to rise in popularity of the food-service industry. Though this is a highly promising industry, it doesn’t guarantee success. Most restaurant owners will say it’s not a ‘get rich quickly’ industry but a more work hard and make a living industry.
The harsh reality is that many restaurants fail during the starting phase itself due to the lack of proper planning and strategy. Globally, out of 100 new restaurants that open only 01 manages to survive in the next 03 years i.e. overall survival rate is 1%. Opening a restaurant requires a lot of meticulous planning, execution and finally some unique secret sauce to churn out the best recipe for success. Today’s restaurants offer much more than making food and serving it. There are tons of other factors to be considered like – location, design and ambience of the space, chef and other staff, pricing, fresh supplies of raw materials, customer service etc. The more streamlined you can make your business, the greater are the chances of your success. Whether you plan for a traditional diner, or a Italian pizzeria, Chinese buffet, or a deli for busy lunch goers, you need to be mindful about the fact that there are a thousand parts that need to collaborate and move together, and being knowledgeable about each of them is imperative. This is where the business plan plays a pivotal role. Curating a restaurant business plan would kick-start the much-required research on each aspect of turning your dream into reality. It would help you define your business goals, set benchmarks to finally achieve your goals with time.
If you have decided to start your business in the food industry, probably you should start by writing down the business plan. Let it be a fast-food restaurant, food & beverage business, or a full-fledged luxury restaurant; choosing your niche and writing it done is essential. For a fast-food restaurant managing the stocks and operating cost could be challenging, which could be figured out through a proper fast-food restaurant plan. Whereas a food and beverage business plan can help you to set up your food & beverage business.
What is a Restaurant Business Plan?
If you are wondering: “how to start a restaurant business?”, “How to successfully set up and grow your restaurant?” A restaurant business plan is a strategic road map and a guideline for your restaurant business. It would consider every aspect right from the minutest detail to the most critical decisions you will need to make in launching and running your restaurant. A thorough business plan forces you to document vital stats of your business on paper like start-up costs, annual budget and projected sales etc. Apart from financial projections, it also discusses the nature of the business itself, background information, and organizational strategies that govern the day to day activities of the restaurant.
Why is a Business Plan Important for a Restaurant?
- Validating your Vision
A business plan for a restaurant would be the first driver to put your vision on paper and that would go a long way in clarifying your dream not only to yourself but also to others and turning it into reality. Before you plan to pitch your restaurant to customers or potential investors you need to have a clear idea of what you want to achieve. Exploring critical details like the concept of the restaurant you plan to start; business model and its core values would go a long way in marking your success journey. The type of restaurant and the business model you plan would depend on factors like market potential, cuisine, budget and capability. All other key business decisions you make would in turn be dependent on the business model and type of restaurant.
- A Marker to your Progress
A business plan not only acts as a marker to your progress but also sets benchmarks to assess your progress on the way. Setting clear timelines and defining goals helps you evaluate whether you are getting closer to achieving the goal within the stipulated time. For example, if you plan to break-even within a year, then you can set your monthly sales target and follow it to see if you are close to achieving your goal.
- Mitigating Risks through SWOT Analysis
One of the primary tasks while curating a business plan for your restaurant is to perform SWOT analysis to foresee the opportunities, risks, threats that are involved in running the business. Identifying these risks and threats early in the business will help you draw a mitigation plan thus preventing any wastage of time and resources. A business plan should also leave enough overhead to accommodate unpredictable factors like inflation, taxation etc. so that they do not have a negative impact on the business. Identifying opportunities especially associated with nearby competition can help you channelize the USP of your restaurant. It can also help you uncover risks associated with duplication of any competitors.
- Operational Plan Analysis
Writing a restaurant business plan forces you to enlist all the operational tasks associated with running the restaurant. For this, a clear vision of the concept and theme of the restaurant, food you plan to serve, positioning in the market, and the kind of service you would offer is essential. This would in turn help estimate the daily running cost, number of staff required, food costs, supply chain details etc. This will also help you close in on any external companies you would need to hire to get your restaurant up and running like POS systems or restaurant reservation systems. You would need to do considerable research to convince your investors on why you would need any of them.
- Marketing Strategy
A comprehensive business plan should consist of a sound marketing strategy. The process of a business plan would help you paint a picture of a clear marketing strategy before and after you open its doors. Your investors would also be keen to know how you plan to promote your business and ensure its success. Your marketing philosophy would drive your marketing program, and it should be well thought out and convince the reader that a workable, enthusiastic plan is in place. A restaurant marketing plan could help you to set up your marketing goals and strategies to achieve them and attract the investor to invest in your restaurant business.
- Proposal for Investors
This is the most significant function of a business plan if you are looking for external investment or funding of your restaurant business. It not only communicates your idea and strategy of your business to your investors but also proves your commitment towards the business. While writing a business plan you will also identify other documents that will be required while approaching a bank for a loan like personal tax returns, financial statements etc.
Most people don’t even fathom how expensive it is to run and maintain a restaurant. Developing a business plan consumes a lot of time and effort, however, it will give you and your investors’ confidence that you can turn your vision into reality and it’s worth investing in. Despite any amount of planning and strategy there are a multitude of things that could go wrong. However, sticking to your business plan and working consistently towards achieving your goals, is sure to generate positive results. If you are muddling to start your business plan, you can seek help from restaurant business consulting services, who can guide you through that.
Why DFX to write a restaurant business plan?
Whether you need a good get-start to start writing your restaurant business plan or have a plan that you are seeking to verify and validate, DFX restaurant business consultants can guide you to set up the framework for your new restaurant venture. DFX restaurant consultants shall guide on the do’s & don’ts based upon years of experience in the restaurant & food business. DFX team shall develop a fully customizable business plan for your restaurant business.
In the visioning exercise, the objective is to lend clarity and comprehension to the business idea under consideration. It often leads to discovery of potential bottlenecks as well as better ideas and inputs.
The idea behind conducting a SWOT analysis is to identify the existing strengths and weaknesses in the light of the business vision for formulating effective planning and strategies later on.
Restaurant business need to function and move ahead as one organized unit. In this module, our experts shall define the internal organisation structure of the proposed business entity. We will also map the scope of work and functioning of the external stakeholders (i.e. agencies, consultants, vendors, suppliers, etc.).
IT system strategy shall also be defined which shall cover the assessment of the IT and software requirements of the business spanning across various line and staff functions. The timeline for implementation of every software application shall also be done to ensure that business operations are initiated as per schedule.
Process Strategy shall be a part of business strategy wherein you will learn about how to make your startup business enterprise more process-driven and less people-dependent. You will uncover tools and strategies critical to achieve the same. The module will cover how business processes and operations are defined and how they can be improved and improvised in a planned and systematic manner.
Marketing begins with the idea of restaurant business or a product/service itself. Everything that places a business enterprise in the right spot at the right time is mostly about marketing decisions and strategies. DFX experts shall work closely with your business and devise "Go-to-Market" and "Business Launch" marketing budgets and strategies so that your business starts off with the right note.
Your advertising and promotional efforts would be meaningless if you fail to generate the targeted sales levels, consistently and efficiently. Managing and controlling sales can cover a wide range of factors including data analysis, goal-setting, feedback and reporting, skill training, defining workflow, leaderships and monitoring, time management, incentives, etc. In this model, you will learn about formulating a robust sales operations strategy for your business.
It is important to let the ‘numbers’ validate your business model before taking a deep dive into it. In this section, DFX experts shall help you assess the financial requirements and commercial viability of your business project.
Good budgeting ensures that you are spending your investments and revenues judiciously. If you go spending unplanned, you are almost certain to deviate from your profitability goals. Budget allocation serves as a business’s expenditure roadmap. As a part of the business financial strategy, this module will cover the approaches and guidelines for effective budget allocation.
By determining the action plan, we arrive at the implementation plan with duration of the project. It maps the sequence of tasks that must be completed on time; otherwise the project will get delayed. In this module, you will learn to map the critical path that leads to the launch of your business on time. It will help you channelize your focus and efforts on priority basis and help you stay organized during the entire process.
Do's & Don'ts are well-defined within implementation plan to avoid anticipated roadblocks during restaurant business setup
25 - 45 days.
Step 01 - Request for Quote
Step 02 - Service Quote Finalization along with SLA (Service Level Agreement)
Step 03 - DFX Experts start working on your business
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