Opening a restaurant is a huge undertaking with a lot of moving parts and a task list that is a mile long.
Don’t forget these points that could save you some pain down the road.
Location, Talent, Concept
Chef Tyson Cole has two wildly popular sushi restaurants in Austin, TX. When he says you should never start without the big three, you should probably listen. The big three according to Cole are location, talent (chef), and concept.
Starting with a location that is physically accessible increases the chances of success. But there’s more than just physical accessibility. To target the widest demographic, your restaurant also has to be accessible in a broader sense. Fast service, casual dress, and lower cost are all things that make your restaurant more accessible.
“Fast casual restaurants are booming because they’re incredibly accessible on all levels”
Having a clearly defined concept will help you choose the right location and make sure you have the right talent to bring that concept to life. Chef Cole says that these three are intertwined.
“No restaurant succeeds without a great chef, a great location and a great concept. They all work together. Your location should fit your concept. Your chef, or ‘talent,’ must fit your concept, otherwise you’ll constantly deal with the most common word in the restaurant business: Drama.”
Lorri Mealey is a former restaurant owner and has worked in all facets of the restaurant business, from hostess to owner. She writes for about.com as a restaurant expert and directs attention to the very important point of making sure you hire a bartender who is more than a drink mixer. If you’re going to have a bar in your restaurant, this choice is one that shouldn’t be made lightly.
“A good bartender will not only know how to pour drinks, he or she will excel in customer service…A good bartender will make every patron feel welcome and comfortable.”
It might be tempting to cut cost in equipment and dishes. Lorri advises against this, stressing the importance of purchasing commercial equipment and dishes.
“I remember buying up a huge stock of really cool dishes on clearance sale from a retail outfitter. The dishes seemed like they would hold up fine in our restaurant. WRONG. A few cycles through the dishwasher and every plate was chipped or cracked.”
Residential equipment and dishes might be tempting but commercial supplies are more expensive for a reason: They’re made to last in a restaurant environment.
Overestimate on Budget
Budget is one thing that must always be considered, according to both Chef Cole and Lorri. Every business owner knows that he or she must have a budget in place, but there are some considerations you might not have thought of. Chef Cole recommends always overestimating capital needs.
“Plan on having six to nine months of working capital from the start. You’ll be surprised by how quickly the expenditures add up and how much time it takes for a new place to grab hold and get legs/regular customers.”
Lorri advises against cutting your budget on advertising costs. She recommends inexpensive flyers, making the most of your web presence, and partnering with other local businesses.
“In today’s economy, restaurant owners need to think outside of the traditional advertising box. Advertising is essential for business, but can get pricey.”
One area of the budget Chef Cole says should never be cut is the customer experience.
“Determine a percentage of your revenue to put into improvements that affect the guest and constantly enhance their experience. At Uchi we don’t spend money on advertising or marketing but we run a very high level of comps. We give away gift cards and send a lot of complimentary dishes to tables. Guests love when a dish comes out and the server says, ‘The chef wanted you to try this,’ because that creates a real connection and makes the experience personal.”
Processes and Systems
It may seem counterintuitive for a creative soul to implement systems and processes, but Chef Cole insists this is essential to the efficiency and survival of a new restaurant.
“Many restaurant owners don’t want to come off as corporate; to them, the ‘C’ in the word ‘corporate’ is like the Scarlet Letter. To embrace systems would be like selling out and becoming a chain. I feel the opposite. There’s a reason chain restaurants thrive: Every one of them started as an individual restaurant. Each had a great chef, a great concept, and a great location, and they developed systems that enabled them to build guest demand, hold onto key people and make money. Otherwise it would have been impossible to open two locations, much less 200.”
If you’re a chef, you are likely better at the creative side of starting a business. The idea of putting systems and processes into place and keeping the business side aligned might make you ill. Chef Cole is sympathetic and offers a solution:
“Always look for people who are smarter than you. As a business owner the smartest thing you can do is partner with people who know things you don’t — and then give them a reason to care.”
Opening a restaurant can be a daunting task, but considering these tips from two pros who have been there will definitely help you get closer to the success you aim to achieve.