When you start a business, having a business plan is essential. It helps you map out the direction of your business and your intentions. If you’re planning on opening a restaurant, opening a coffee shop, opening a bakery, or thinking about the cost to open a food truck, you’ll also need to have a restaurant business plan-where you can plan for direct to consumer trends.
A business plan for types of restaurants like cafes, fine dining restaurants, and pop up restaurants, helps you differentiate your business from others. It sorts out the details in terms of the restaurant concept, design, location, and financials-like flat rate shipping costs.
Putting thought and research into your potential business venture is crucial. With a business plan, you’ll have all the research in one place with the answers you and your investors need to move forward. It sets you up for long term success.
So, how do you write a business plan? This article has everything you need to create a restaurant business plan and prove the viability of your idea.
Why Is a Restaurant Business Plan Important?
A restaurant business plan acts as the blueprint for any business venture. It provides an outline for your vision while also explaining in thorough detail how your business will operate. This plan can be shared with other business owners, investors, and stakeholders.
With a detailed business plan in place, you’ll be able to ensure that no detail is overlooked, and you can successfully grow your business. If potential problems arise during the construction, staffing, licensing, or operational process, your business plan will act as a guide.
Many restaurants will fail and some of them do because there was no business plan in place. Coming up with a well-thought-out and detailed business plan can be tough and time-consuming. However, it can make the entire process of opening a restaurant less stressful and messy.
A solid business plan can help bring investors on board and prove that your idea is worth it. It’s what will help you figure out how you’ll reach that break even point and start profiting.
How to Write a Business Plan for Restaurant
A solid restaurant business plan can vary based on the kind of food establishment you have. You have to take into account different factors of the business including the restaurant style, target or niche market, and location.
If you’re a newbie to the restaurant industry, the idea of writing your own business plan can seem overwhelming. However, we can help you get started.
Below you’ll learn about some key elements you should include when writing your business plan. A business plan for a restaurant includes:
- Executive Summary
- Business Concept
- Target Market and Competition
- Sample Menu
- Management and Employees
- The Design
- Location
- Marketing and Advertising
- Financial Aspects
The Executive Summary
This summary should be the first section of your business plan. It plays two roles as it introduces and also summarizes the vision of your business. In the summary, you’ll want to introduce the key elements of your restaurant’s business plan so that the reader is invested. It’s best to add enough detail, but not too much so you can intrigue the reader.
Within the executive summary, be sure to include the restaurant’s mission statement, the business concept, how you plan to execute the business, potential costs, and a brief ROI analysis. You can also include the core values of the business.
Business Concept
In the business concept section, it’s ideal to go into detail as you describe the restaurant’s concept. What kind of products or services will your restaurant offer? What is the inspiration behind the concept? How is your restaurant's concept unique?
Describe the service style you envision for your business. Identify the kind of food you’ll serve. It’s best to be as clear as possible about how your restaurant is unique compared to others.
Target Market and Competition
The restaurant industry is quite competitive as it is. Entering it with a new idea can be tricky. This is why it’s important to conduct thorough market research as this is what will help you stand out.
Complete a data-driven market analysis and identify the customers that you’ll attract with your new restaurant concept. Focus on what makes your niche different from other concepts, and how its relevance to the industry as a whole will be beneficial to you.
In this section, you’ll also want to elaborate on what other businesses exist around the location you’re targeting. These restaurants will be your biggest competitors. Include the number of competitors in the area and explain their concepts. This information will be important for investors to understand how your business will stand out.
Sample Menu
Your restaurant menus (see menu meaning) will be the most important part of your business. Jotting down a list of menu items isn’t enough. You should incorporate a potential menu design and add a logo.
The sample menu in your business plan should include prices that are based on the cost analysis that you’ve done. There are different ways to find out how to price a menu, but in most cases, it will be based on potential food cost and labor cost. The prices will show investors that you’ve done your research and are confident that you can sell the menu items at the price points.
There are countless types of menu options for you to choose from and the ideal one will be based on your restaurant concept. You can have a prix fixe menu, dessert menu, food and wine pairing menu, digital menu for wine, or table d hote menu. It’s possible to also incorporate a restaurant QR code menu.
Management and Employees
A successful restaurant business will need to have restaurant management and staff. These include a restaurant manager, bar management team, wait staff, bar staff, and an inventory control manager.
This section of your restaurant business plan should provide an overview of the team you’ve established so far. It should also highlight any new positions that you may want to add. Include the employee and management work experience and necessary skills when presenting your team.
Be sure to include the salary or pay that you will be giving each staff member based on their roles. With this information, your investors will get a solid understanding of the potential your restaurant has to succeed.
The Design
Within the design section of your business plan, you’ll have the opportunity to show off any ideas you have to your investors. You don’t necessarily have to include professional mock-ups, but it won’t hurt. You can express your vision through a mood board using pictures of ideas or aesthetics that you like.
The design of your restaurant goes beyond the actual look. It should also include restaurant technology and software that can be essential for the business. If you plan to cook using a wood-burning oven, you should include it in the designs.
Location
Picking the location is one of the most important aspects of starting a business. This should go hand in hand with the target market that you’ve chosen. You might not have an exact location picked out yet, but you should include some to choose from.
You should be as detailed as possible about each potential location so that you can explain why it would be the ideal place for your restaurant. Include the typical demographics of the location, the square footage, foot traffic, and any other important information.
Marketing and Advertising
The restaurant marketing and sales portion of your business plan will be crucial. In this section, you should cover the position and brand identity of your business, promotional tools and tactics, as well as sales tactics.
Your marketing plan must include a promotional strategy for before and after you open your restaurant. Potential options include marketing through social media and creating a website. On that website, you should include an about us page which can be created using an about us page template or by following about us page examples. These will give your restaurant credibility.
It’s possible for you to only have some of your marketing and advertising concepts planned out. However, as you develop more, you should add them to your plan. This will happen as you continue to develop your restaurant business. It's also crucial to use O2O marketing efforts.
Financial Aspects
The financial aspects of your restaurant business are crucial and a section that your investors will be interested in. You want to highlight the current financial state of your business, include financial projections for one, three, and five years from now, and be sure to reference cash flow and statistical averages.
Explain what you’ve spent money on already, how much you plan to spend, and on what, how you plan to secure the funds, additional costs that may incur, and potential returns. This also includes when you plan to make a profit. This can be done with a restaurant profit and loss statement or income statement.
Frequently Asked Questions About Restaurant Business Plan
What Is a Restaurant Business Plan?
A restaurant business plan acts as the blueprint of your business activities and vision and explains each detail of business operation. Business plans are essential to have before actually starting a business because they can showcase your vision to other business partners and investors. It can also guide you as you start to get your small business off the ground. You may also consider using a business process flow chart template to identify your business processes.
Why Is It Important to Have a Restaurant Business Plan?
It’s important to have a restaurant business plan in place because it creates a roadmap for you to follow. If written correctly, it will include benchmarks for your restaurant business that will allow you to assess the progress of your business. It can also include timelines for all of your restaurant plans and encourage you to work towards achieving your goals.
What Sections Should I Include in My Restaurant Business Plan?
The sections that you should include in your restaurant business plan are:
- Executive Summary
- Business Concept
- Target Market and Competition
- Sample Menu
- Management and Employees
- The Design
- Location
- Marketing and Advertising
- Financial Aspects
What are the 3 Main Purposes of a Business Plan?
The three main purposes of a business plan are to:
- Define the business's goals and objectives
- Create a roadmap for how the business will achieve those goals
- Attract investment or funding from potential investors or lenders
What are the Common Problems of a Restaurant?
Restaurant owners face a number of challenges, including inventory shrinkage (theft), waste, and high labor costs. They must also deal with inventory turnover, employee turnover rates, which affect customer service and satisfaction.
What Makes a Business Plan Successful?
A successful business plan must be well-thought-out. This means that it should be clear and concise. By taking the time to carefully consider your business goals, you can increase your chances of success.