Restaurants are one of the most common small-business starts there are, but they are also one of the businesses that fails most often. When a restaurant fails, it’s usually because the owner didn’t make sure all of his ducks were in a row before opening. The success or failure of a restaurant usually is dependent on getting everything right before the doors are even open. Here are five tips for launching a restaurant successfully.
Find the right location
Location is everything when it comes to the success of a restaurant. That’s why just taking over a vacant restaurant space may not be the best idea. For one thing, you want to find out why the previous restaurant closed. If it was for lack of business, then you should rethink the location choice. Any location you choose needs to have adequate parking and should be easy to find.
Have a plan
To have a successful restaurant — or any other type of business — you need a good business plan. In fact, you will not be able to borrow money without presenting a business plan. Your business plan should include your restaurant’s concept and why you think there is a market for it. You also should show projected profits and/or losses going out several years.
Market your business
Just because you open what you think is the best restaurant in the world, that doesn’t mean other people know about it, and you can’t rely on word of mouth from friends and family. You must do marketing to let people know about your new business. If you don’t have money in your budget to do paid marketing, then hit social media hard. Set up and maintain pages on social media and constantly post new content about your restaurant.
Put systems in place
If you are starting your own restaurant from scratch rather than buying into a franchise, it may be because you don’t want to feel “corporate.” But one feature of franchised chains that you should incorporate into your restaurant is some sort of operating system. You can steal from another restaurant or create your own, but without a system, you are likely to have chaos, employees will not know what to do and your restaurant will be more likely to fail.
Don’t underestimate your capital needs
Starting a restaurant is a lot of work and it takes a lot of money to get started. You need to make sure you have enough cash on hand or access to credit to operate in the red for at least six months. Even if you are very successful out of the gate, it could take time to become cash flow-positive and pay off start-up costs.