This is a guest article written by Jennifer Motruk Loy, Vice President of Marketing & Communications for VSAG restaurant consultants. In her spare time, she enjoys traveling, collecting art, and is a fan of food-based reality shows.
Step one to opening a great restaurant is having a great business plan. Sure, you have envisioned the concept for years: It will have a great atmosphere, you’ll provide great service and the food will be so amazing, guests will return again and again…
All that is great, of course, but keep in mind: Business is business. Yes, all chefs/restaurateurs want to serve fabulous food, but if the business plan for your concept doesn’t work from top to bottom, all you are left with is just great food.
And what is the key to turning your concept into a bona fide business? Money. Most of us can’t open a restaurant on our own, and without the proper financial backing – there is no restaurant. Therefore, after you have figured out your expected financials (i.e. rent/utilities, food costs, capacity, salaries, insurance, etc.), and conducted a pro forma analysis, it is time to plan a capital raise (i.e. obtain money from investors who will own business shares in exchange for their investment).
Check out Episode 1 of the Restaurant Engine Podcast:
Building a Business Plan For Your Business
In order to conduct a successful capital raise, you need to impress potential investors. And a concise, thorough and balanced business plan that highlights why this is a great opportunity for them is essential.
Getting started may seem daunting, but here are a few strategies/tools for developing a successful business plan.
Creating a clear mission statement will only benefit you and all who read your business plan. What is your restaurant all about? What kind of food/vibe/experience do you want guests to enjoy? Include top-line the specifics of your restaurant in one succinct mission statement.
Expand upon your mission statement and brand by bringing your concept to life. Think across the board: What does your ideal menu entail? What will the color scheme be? What will the fabrics/seating and atmosphere look and feel like? Create a conceptual vision of your restaurant illustrating the inspiration, look, feel, aesthetics, functionality and floor plan.
All concepts begin and end with your mission statement, and the development of your ‘brand’ is no exception. Creating your branding is an essential part of the business plan. An extension of your mission statement, your brand concept should include: Supporting details that enhance/explain further your ideals, vision, key messages/strategies and point of differences.
Once the concept is developed, how will you attract guests, create brand awareness, and build a following of loyal and repeat guests that will keep your concept moving into the future? Marketing includes advertising, in-store promotion, guest engagement, outreach, community involvement, digital communications, media relations and social media management. If no one is talking about your business, no one is going to give you business.
The goal here is to provide a general outline of the operating systems that will be incorporated in the business. Ultimately, putting a financial plan into effect will allow your business longevity and growth potential, and demonstrating a clear understanding of how to operate and manage revenue and expenditure is going to catch the eye of investors for certain.
Conclude your business plan with a conservative eye to the future. Detailing how you would like your business to grow and at what pace will give your business plan some legs (i.e. movement towards the future).
Lastly, create an engaging, detailed presentation to support (and mirror) your business plan. Here is another chance to ‘wow’ your audience and put your dream on display!
Looking for more helpful resources? Check out our collection of resources for building an effective restaurant business plan.