It’s no secret that the restaurant industry is challenging. Operators battle slim profit margins, high employee turnover, and supply chain disruptions on a daily basis. If you're thinking of opening a restaurant, you need a clear restaurant business plan that positions you for long-term success.
So, where to begin? Before you start setting up shop, it's important to consider the essentials of a restaurant operation. That means thinking beyond the food that inspired your restaurant vision to ensure your concept is profitable.
With a well-crafted restaurant business plan, you can:
Attract investors who will help make your restaurant dream a reality
Forecast how you’ll generate profits
Establish a long-term roadmap for growth and viability
Keep reading to learn the fundamentals of restaurant business planning and get a free template to get you started.
How to write a restaurant business plan
The main goal of a restaurant business plan is to outline how you intend to generate profits. Finances aren’t the only focus, though — you’ll also want to think about important factors like your branding, staffing, and marketing strategies.
A clear, comprehensive business plan can work wonders in engaging investors and keeping you on track in the heat of day-to-day operations. But before putting pen to paper, there are a few preliminary measures to take.
1. Review sample restaurant business plans
Spend some time reading through business plans from other restaurants. You can ask other operators to share their restaurant business plan, or find examples online (e.g., the U.S. Small Business Administration website). Where do their numbers fall? What expenses strike you as high or low — and why? Where do you think you can streamline costs or increase your margins? Studying how other restaurant owners model their businesses can inform your approach.
2. Calculate your costs
Now it’s time to make a list of your estimated startup and ongoing costs and begin drafting a budget plan for your restaurant. Startup costs can range from a few thousand to several million dollars, depending on your unique business, so it's important to accurately forecast your budget.
Determine whether you're taking over an existing space and leaving it as is, renovating an available location, or building from the ground up — and calculate the associated costs. Will you need to design a dining room from scratch? If you're seeking a liquor license, what will that cost? How much will you need to spend on ingredients to make your menu every day? How many people will you need to hire, and for what roles? What pre-launch marketing materials will you need? Think about your website, takeout menus, and other collateral: what will it cost to get these designed, written, and produced?
3. Decide what matters most
As a business owner, you set your own priorities — and the startup period is the best time to clearly define what those are. For example, if you’re opening a fast food restaurant, you may decide to prioritize speedy service, extensive menu options, and affordable prices. Or, if you’re opening a fine dining restaurant, you may decide to prioritize high-touch service, an elegant setting, and high-quality ingredients. No two restaurants are the same, so no two restaurant business plans will be the same.
5 key sections in restaurant business plans
While your restaurant concept should be unique and offer a culinary experience your target customers are currently missing — or don't know that they're missing — your restaurant business plan can follow a well-established template. While every sample restaurant business plan is slightly different, they all contain similar core components: an executive summary, business overview, industry analysis, operations plan, marketing plan, and financial analysis.
1. Executive summary
Articulate the big picture for your restaurant. Introduce who you are, what your vision is, and which market you're addressing. Include items like your mission statement, core values, and key differentiators.
2. Business overview
Whereas the executive summary is all about the big idea, the business overview (or company description) delves into the details: outlining the concept, brand, structure, location, design, and so forth.
3. Industry analysis
Show readers where your restaurant fits in the marketplace. Talk about the local competition, nearby businesses (e.g., office buildings, shopping centers, movie theaters), the neighborhood's economy and projected growth, your target demographics, and other market insights a potential partner or investor would want to know.
4. Operations plan
This section should provide an overview of your restaurant’s day-to-day operations, including the organizational structure, employee pay, customer service policies, and plans for all restaurant processes and procedures. What restaurant technology will you invest in? Will you partner with a delivery service? Here, you have the opportunity to outline how your restaurant will function on a daily basis.
5. Marketing plan
All things related to customer awareness and acquisition, advertising, public relations, and community engagement live here. How are you going to let customers know you've opened up shop? How will you keep them coming back to the restaurant — and placing delivery orders from home? How will you continue to engage and communicate with your fans once you get a bit more established? Answers to these questions will inform your core marketing strategy.
Download a sample restaurant business plan
To make building a restaurant business plan more manageable, break the process down into segments you can tackle one at a time. This makes it less daunting and will help you think through each component to create a stronger, more compelling plan.
While it may seem impossible to represent your restaurant vision in a single document, a business plan assures potential stakeholders that you have a detailed recipe for success. Ready to put your restaurant ideas on paper? Download the free Restaurant Business Plan template to get started and move one step closer to opening your restaurant.