Creating your restaurant business plan should be a top priority when starting your new restaurant business. It simply involves a clear and straightforward idea about how you would run your restaurant. The plan includes everything about the business, the products, the financials as well as the general company strategy
As simple as it may sound, the restaurant business plan looks like a guide or a roadmap to guide your new business’s future expansion.
This acts as a blueprint to run the company.
People have to remember when writing their restaurant business plans that it is meant for clarity of vision and general use.
It is pretty much like every other business plan but includes specific details related to the restaurant company.
Your restaurant business plan is, for the most part, needed by you.
Therefore, it is a document that is meant to be used internally, and it is not shared.
Writing your restaurant business plan the right way is mandatory if you want to steer the new company to success.
This post details all the important elements of a great restaurant business plan.
But before we go into details, we have to understand the concept of a corporate business plan and get a grip on the food industry.
What is a business plan?
Technically, a business plan is a formally written document that contains important information about your business.
Also, this information includes your strategy, the company ownership structure, personnel, the company’s strengths, and weaknesses.
The company’s financials, the company’s mission, the timeframe needed to achieve specific business goals, and so on.
There is no limit to what your business plan can contain.
Your business plan might also go further to describe the core business function of your company.
Its main product or service, need for financing, goals, strategies to achieve stated goals, and financial projections.
Technically, the business plan as a whole acts as a road map or blueprint to help guide your company when it fully becomes operational.
In most cases, written business plans are developed to benefit a business proposal, which is then used to access loans to help expand the company.
An overview of the food industry
Before you learn how to write a plan, you will have to understand the food market.
Food is one of the essentials of life.
People will always eat.
This is one of the reasons you have restaurants springing up everywhere you have people gathered together.
Also, the business case for opening a restaurant company is that people will always need to eat.
Most restaurants are in business to feed people when they are hungry, especially people working or traveling.
However, some other restaurants are in business to serve up specific delicacies of cuisines to serve up the appetite of the people living in that area.
Also, it is not uncommon to find a Malaysian restaurant within the Malaysian community in London, New York, Los Angeles, and every other urban metropolis.
One good example of such specific restaurants that serve up continental delicacies specific to a region is the Chinese Restaurants.
They are pretty popular in most parts of the globe.
Since food is such a necessity of life that must be taken three or more times a day, the restaurant business is such a huge money-spinner worldwide.
Regardless of your food, the well-located and well-managed restaurant company is a huge revenue generator every year.
Any start-up based in the food industry within a well-structured urban area will be sure to get back the money invested in no time.
Such businesses are bound to become successful within such a short time.
One benefit of setting up a first restaurant company is that the company owner has the power to fix up the price of their delicacies regardless of the prices of their competitors.
This theory is especially true for unique and highly in demand delicacies that are peculiar to a people.
All across the world, we have different types of restaurants, and they are:
- The local restaurants,
- Fast food restaurants,
- Restaurants for casual dining,
- Family-friendly restaurants,
- Restaurants for fast-casual dining,
- Continental and intercontinental restaurants,
- Traditional restaurants, and so on.
Technically, such food cafes cater to the different feeding needs of various tribes, ethnic groups, cultures, races, and creeds.
In most cases, these restaurants are influenced by their surrounding community, such as the Thai restaurant, the Indian restaurant, the Italian restaurant, etc.
The people’s dominating culture within the community often influences and extremely determines the restaurant’s service.
Minding your restaurant business
You could decide to begin a restaurant business within a business area, a sports stadium, a construction site, an international school/university, or a tourist site.
Also, to take full advantage of the restaurant business’s decent location, you should offer the best delicacies of the people you find around the location more.
Furthermore, there should be plans to expand to accommodate other menus based on demand or the influx of new people to the area.
These are some of the essential elements you must include in your restaurant business plan; the possibility to expand to include other new recipes.
You should be aware of the culinary skills involved in certain delicacies.
This will invariably lead to the cost-benefit decision of hiring talented chefs or learning to prepare the meals yourself.
Therefore the need for a specialized chef or personal training of existing cooks to imbibe new skills should be included in your restaurant business plan.
In most cases, you will have to conduct exhaustive and thorough feasibility studies before you will eventually settle for a certain restaurant style.
Other valuable information you get from the studies is your pricing strategy, location (if you do not yet have one), and other important aspects.
Some of the top ten restaurant business brands around the world
If you were going to be venturing into the food industry, it is always best to think about the market’s leading companies.
This can be used as an inspiration in coming up with a tenable restaurant business plan.
The following are the leading brands in the industry.
Starbucks might be a name synonymous with coffee.
But the food business is beyond serving up hot cups of coffee in the wee hours of the day.
The company’s estimated revenue is a whopping $24.1 billion.
It has over 30,000 stores across the world.
The company specifically deals with teas, coffee, snacks, and fresh foodstuffs.
The company also sells different branded foodstuffs like Frappuccino, Seattle’s Best Coffee, and so on.
The name ring bells to lots of hungry stomachs at dinnertime.
The company worth $19.3 billion has been serving up delicacies to fast food lovers for a long time.
It has the biggest chain of fast-food restaurants in the world.
McDonald’s is still one of the most recognized brand names in the fast-food business.
It has over 39,000 stores in approximately 100 countries.
3). Yum China Holdings
This Chinese-based food company has a revenue of $8.0 billion.
It is a Fortune 500 company that began in the US but has its head office in Shanghai, China, where it rules the food market.
The company has thousands of restaurant stores all over mainland China.
The company is known to be behind the Chinese versions of such companies as Taco Bell, KFC, Pizza Hut, and other local food chains.
4). Darden Restaurants
Darden Restaurants is a company that rakes in about $7.8 billion.
The food company involves a food brand that includes a chain of restaurants for fine and casual dining.
The company also controls such brands as Yard House, Eddie V’s, Seasons 52, Bahama Breeze, the Longhorn Steakhouse, Olive Garden, and Red Lobster.
Autogrill is the sixth biggest food company in terms of market capitalization, with total revenue of $6.0 billion.
The food restaurant chain is based in Italy, with over 1,000 locations scattered across 31 countries.
Therefore, the food company has a portfolio that contains like 300 brands, with lots of these operating around highways and the airport.
Some popular products of food outlets include Ciao Ristorante, Graband, and Spizzico.
6). Chipotle Mexican Grill
This is one of the most profitable food chains in Mexico that sells simple and fast-casual Mexico type foods.
The company focuses on preparing and selling tacos, bowls, burritos, and similar food delicacies.
The company has an estimated revenue of $$5.6 billion.
Chipotle is known to work in 2,580 different domestic areas as well as 39 international outlets.
It has several outlets in Germany, France, Canada, U.K, and the USA.
7). Restaurant Brands International
This food chain should be such an inspiration for new start-ups.
It is worth $12.5 billion with an estimated revenue of $5.6 billion.
It began when Burger King merged with the Canadian-based coffee line Tim Hortons back in 2014.
The outlet is known as one of the biggest food quick-service restaurant chains globally.
The company currently runs over 27,000 restaurants in over 100 territories and countries.
8). Yum! Brands, Inc.
Yum! Brands is a company that was formed by PepsiCo, Inc. back in 1997.
It has an estimated revenue of $5.5 billion.
The company is also the biggest food quick-service business in the globe.
It currently has over 50,000 restaurants within 150 countries.
Yum! Brands are famous for owning such franchise chains as the WingStreet, Taco Bell, Pizza Hut, and KFC.
Most of the company’s outlets are owned by franchising partners who are about 2,000 in number.
9). Domino’s Pizza, Inc.
With an estimated $3.7 billion in revenue, the popular pizza outlet is the biggest worldwide.
It has over 17,000 stores in 90 different countries.
The company is a market leader while offering lots of pizza meals offered with delicious variants.
Franchises own pizza outlets.
10). Bloomin Brands, Inc.
With a $3.6 million revenue, the restaurant company is among the top ten outfits in the global food industry.
The company owns lots of restaurant and café outlets.
How to Write a Restaurant Business Plan
Learning how to write a plan for your new company is as important as starting one.
You will have to know how to write specifically regarding the nature of your company.
A fast-food restaurant business plan is used for your fast-food company.
Similarly, the food and beverage business plan are suitable for your company if you will be serving food and beverage as your primary products/services.
Structuring your restaurant business plan
A good restaurant business plan sample should show you how to write your plan according to the right format.
It should have a simple layout, easily understandable, feasible, and logical.
Furthermore, you must think about the future when developing your restaurant business plan.
The plan should have long-term sustainability.
This means that it should include content relevant to your restaurant business for about five or ten years from now.
It is advisable that when learning how to write a restaurant business plan, you should first study various business plans of other restaurant and food outlet companies.
You could use any online restaurant business plan as a sample to guide you in the process.
This will give you a better sense of how to write your restaurant business plan.
Things to include in your restaurant business plan
The most convincing restaurant business plans always contain most of the elements described in the following section.
The general rule here is to include certain information that will help persuade people you have never met.
There are certainly important elements to add to your plan to spice things up.
1). The Executive Summary
The executive summary is the general outline that looks to introduce the whole aspect of your business plan in a broad outline.
It will describe the niche of your new restaurant.
This is the main area that you will be specializing in within the food market.
It will also list out your role in the daily affairs of the business.
This part of the restaurant business plan specifies the type of business.
Whether you want ethnic cuisine, fine dining, a sports bar, or just a joint for casual and fine dining.
This section will inform potential investors about your strategy to approach the market.
You will also want to state the name and location of your restaurant business.
You should be pretty clear about what your responsibilities as the owner of the restaurant should be.
Having a food business entails lots of moving parts.
You cannot do everything.
The business involves multilayered operations.
This means that you will have to design menus, you will have to cook and keep the food fresh.
You will also have to manage your finances, customers have to be served dishes, and you have to promote your company.
You do not expect to have one person doing all of this.
Therefore, you must add your partners, staff, employees, and workers in the executive summary.
In starting a new company, it is possible that you may not have found any partners or staff yet; you could describe what roles you wish to delegate to the staff and partners.
For example, we have lots of chefs who run their fine dining restaurant companies from the kitchen.
In this case, your primary role will be to stay in the kitchen and cook, while you hire other skilled and experienced professionals for other roles.
2). The Description of your company
Your company description is a key analysis that seeks to list out key information about your new start-up.
Technically, your company description should contain the following information:
- The location,
- Your potential customers,
- The types of food/delicacies you aim to serve your customers,
- The unique selling proposition of your restaurant outlet, and all that.
Additionally, you may want to add up certain information like your company’s legal name, the ownership, the management team, and the structure of the company.
You will want to ensure that you describe everything from a high level in this regard.
However, you will have to send in the detailed information for somewhere else in the restaurant business plan.
3). The Market Analysis
The market analysis of your new start-up is an essential part of your restaurant business plan.
This is also known as your marketing strategy.
This part comes with three primary components.
a). The Industry:
This part of your market analysis describes your customer-base.
This segment has a lot to do with your company location and the nature of the people located within that area.
It will explain if your company will be catering to middle-aged professionals at breakfast and lunchtime.
You could include dinner takeaway packs too.
This part explains the demographics of your target customers.
It could school children at dinner or families with young children.
How about construction workers at lunchtime?
You should describe your prospective customer base and include several reasons why they would rather come to your restaurant instead of going to your competitors.
This was mentioned in the company description and executive summary segments; you will now fully give a detailed description of your restaurant’s community.
Therefore you can now describe how you fit into the picture.
You will need to mention your competition(s) while mentioning how you would make yourself unique.
This is the detailed part of your restaurant business plan where you go deeper into your competition’s details.
Most dedicated customers at existing restaurants will not change where they dine until a distinct restaurant offers a better atmosphere, menu.
And general approach that makes them stand out from the crowded restaurant market.
This is where you demonstrate to the reader that you understand the way other restaurants are operated and also, your plan to set yourself apart from them.
You should list out the marketing methods you will use to let people know about your restaurant company.
You will need to outline the person responsible for the marketing of your new restaurant outlet.
While you are busy cooking, you will need to get experienced marketing personnel to drive people down to your restaurant.
Of course, you will need to have a marketing plan.
This is where you inform your potential investors that you just hired a local food marketing expert to handle your promotional needs, and you will also need to describe their plans.
4). The Company Operations
This part of the restaurant business plan is also referred to as the products/ services segment.
In addition, this is the part where you let your investors know about your opening hours plus the number of employees you will be adding to your new start-up.
This is also where you get to explain the advantages of convenience made possible by your company’s location, like its proximity to several corporate businesses or uptown location to several construction sites.
Here you would be the best place to speak about any connections you may have with food vendors, also, like local farms or companies that supply foodstuffs.
This will give your company a competitive edge.
For instance, it can be costly and difficult to get liquor licenses in certain markets.
In this place, you will also have to let your investors know that you just brought in a consultant specializing in the negotiation and buying of liquor licenses.
This will help in handling that aspect of the food outlet.
5). The Management and Ownership of your company
This is the part of the restaurant business plan where you get to indicate your management structure.
In addition, you will show who will be in charge of the company.
You would also be needed to handle certain gray areas of the company that might be too technical or cumbersome to you.
Additionally, this is where you describe the management hierarchy besides your ownership.
For instance, you will explain whether managers for particular areas like the bar, the dining room, the kitchen, payment/accounting, and so on- report to the general manager, who will in turn report to you?
You should select a management structure that easily works for you.
Furthermore, you should choose one where the management function can be easily explained to your prospective lenders or investors.
6) Financial Analysis
In this section, you are expecting to mention the expected development of the new restaurant company.
This is where you would include the general budget for your new company.
Furthermore, you will have to add the statement for profit and loss, which pitches the estimated expenses versus the estimated income.
Investors and lenders alike are looking forward to making their money back once they invest in your company.
Therefore, you will have to give them a clear and realistic picture of how this will be done.
It would also help if you worked harder to correctly estimate the total costs of foodstuffs, labor, and cost of operating the company.
You would then compare these numbers against the projected income for your restaurant outlet.
An elaborate financial plan would provide a blueprint to help evaluate your business’s performance every year.
Some people have the perfect idea to begin a winning restaurant.
However, they seem not to know how to write their way to restaurant ownership.
After kicking things slightly off the ground, they will need to approach investors, banks, venture capitalists, banks, and other bodies to bring their ideas to fruition.
Therefore, with this development, it is time they become acquainted with how to write a restaurant business plan.