Restaurant business considerations
MO R E investment and money opportunities for those looking to venture into business. Monday will never be complete
CONSIDERING the opportunity that the Indian F&B industry holds for both future and existing restaurant businesses, it certainly is the right time to enter into this lucrative domain.
1. Decide the Concept of Your Restaurant
The first thing to consider while starting a restaurant business is deciding the idea. You need to keep many things in mind before deciding on a concept, the major one being the amount of capital you have for the investment.
The Average Price per Customer (APC) gives you a fair idea about the average amount of money a customer would spend in your restaurant.
Once you have decided on the concept, you must ponder the theme and cuisine of your restaurant. The interiors must be in sync with your restaurant theme.
Next, you should prepare a business plan for your restaurant as it would help you in planning the future development of your restaurant business, and you can present it to any potential investor.
2. Get Investment to Fund Your Restaurant Business
Most aspiring restaurateurs’ dreams is to never see the light due to a lack of funds, and this is one of the most important things to consider when you think of opening a restaurant business. Firstly, depending on the concept without the countless business opportunities that are presented in this section.
Top of the list is an established restaurant and bar at a perfect of your restaurant you must finalise how much capital is required to start a restaurant in India. When you have the numbers, then you can go about with these three ways through which you can raise money for your dream restaurant:
• Self-funding
If you have enough money in the bank, then congrats, you have crossed the first hurdle of opening a restaurant. It is also a good idea to open a restaurant in partnerships, as it reduces the risks of investment.
• Loan
You can take a loan to fulfill your restaurant dream. However, securing a loan from a bank may include hassles as they look for collateral or someone who can underwrite the loan.
VC/Angel funding
Getting investors on board can be difficult, especially if yours is a first-time venture. Investors usually look for your restaurant venture’s growth potential, quality, and scalability of your business model. The performance of your first few outlets is taken into consideration before one agrees to invest in your business.
3. Evaluate All Restaurant Costs Involved
• location; it is located in the Mbabane Central Business District. On top of being situated in an ideal location, the business is fully fitted. It is selling with all its assets and the asking price is negotiable. As usual, there are also tips and today’s focus is on those selling their businesses.
You will again be spoilt for in starting a restaurant business:
Food Costs – Food cost is the cost of all the raw materials used in preparing a dish. Ideally, the food cost should be around 30 per cent of your menu price. You should finalise the vendors for sourcing the raw materials beforehand to ensure a smooth supply of stock ingredients.
Labour Costs – Labour cost is the second most important restaurant cost that adds up to the expenditures while opening a restaurant. We have discussed the manpower you need to start a restaurant in detail, ahead.
Overhead Costs – Overhead costs are the other expenses that are not related to food or labour. These include:
• Rent
The rent covers a significant part of your restaurant costs, and is profoundly affected by the location of the restaurant. However, the rent should never exceed 10 per cent of your total revenues.
Interiors
You can decide on the interiors based on your restaurant concept and theme, and your budget.
Kitchen equipment
Purchasing the right quality equipment may seem heavy on the pockets, but they always recover their costs in the long run.
Know about the various types of essential equipments without which you cannot run a successful restaurant.
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• choice, as you make another informed choice. Do not forget to send feedback on 7627 9456 or at business@times.co.sz expense of your restaurant, and cannot be ignored. Based on your establishment type, the licence fee varies. We have covered the topic of the restaurant licence in detail below.
• POS
The new age, modern technology POS (point of sale) can smoothen your restaurant operations like never before. The price of POS depends on its features and functionalities, which should be chosen considering your restaurant needs.
Marketing
You should ideally spend one to two per cent of your revenues on marketing your restaurant. There should be a perfect balance between offline and online marketing. Word of mouth marketing, along with digital marketing can do wonders for your restaurant.
4. Decide the Location For Your Restaurant
Location is an essential factor to consider while discussing how to start a restaurant business, as it can determine the success of your restaurant. When choosing your restaurant’s location, it is a good idea to identify your competitor in that area and gauge their progress and understand their business model.
The competition needs to be assessed not just in terms of cuisine, but also the type of dining experience they are offering to their customers – casual dining, fine dining, QSR, etc. Evaluating the competition would help you understand the customer base that hovers in that area, their pocket size, and their preferences.
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