Do you need help cooking up your restaurant business plan?
No matter where you’re at in your restaurant ownership journey, you need a carefully considered, well-constructed business plan. Whether you’re starting a new restaurant or overhauling your existing one, your business plan will guide you to success.
If you’ve never written a business plan – fear not. We’ve built a step-by-step guide you can work through at your own pace. A word of warning – this is not a quick and easy process. Creating a business plan for your restaurant takes effort. But the time you invest now will be well worth the prize of a thriving restaurant in years to come.
What is a restaurant business plan
A restaurant business plan is your blueprint and roadmap. It’s a detailed description of your vision, how the business will operate, and how you’ll bring it all to life. It describes your target customer, competitors and financials. It ensures you don’t overlook any detail in planning for your restaurant’s success.
Why do you need a restaurant business plan
- Confirming to yourself that your plans make financial sense
- Securing a bank loan, business partners, investors and a lease
- Convincing talented prospective managers to join your team
- Demonstrating your concept is desirable and unique in the market
- Mapping out the steps to make sure your restaurant is profitable
- Keeping you focused on achieving your vision
- Ensuring you’ve considered all regulations
- Delivering a blueprint for restaurant operations
Key ingredients of a restaurant business plan
Whether you’ve written a hundred business plans or this is your first one, it’s always helpful to use a template designed for your industry as a starting point. Here’s an overview of everything to include in your restaurant business plan:
- Executive summary
- Company description
- Market analysis
- Marketing plan
- Operations plan
- Financial analysis and projections
1. Executive summary
The executive summary introduces and outlines your entire vision. It should capture attention, sell the sizzle and entice your reader to explore the detail. Consider it a sales pitch. Go light on the detail, you’ll address that later. Some people never make it past the executive summary, so you’ll need to convince them that your concept is worth their time to keep reading. It’s a good idea to write this section last when you’ve got all the details down and it’s easier to pull out the key highlights.
You should include:
- Your mission statement and core values
- Overview of your restaurant concept and why it’s going to succeed
- Rundown of who will bring it all to life, and how
- Forecast costs and anticipated return on investment
2. Company description
The company description introduces the basic information about the business and outlines the vision for the customer experience.
Detail the legal structure of the business. Whether you choose to be a sole trader, partnership or a limited liability company, it’s a good idea to seek legal advice.
If you’re starting a new restaurant business, give an overview of the capital required. Save the detail for the financial analysis section.
Sell your reader on why your business will succeed with an evocative and compelling description of your idea. Approach it as if you were telling a friend about an exciting new restaurant you just visited. Describe it with tantalizing adjectives to bring it all to life. Include details on:
- Unique features (like your 30-minute delivery guarantee or signature dish)
- Service style (from fine dining to fast food)
- Atmosphere (from intimate to rowdy)
- Ambiance (lighting schemes, furnishings, music)
- Related services (functions, home delivery)
- Size and seating capacity
- Operating hours
The most critical element in restaurant success is the appeal of the menu. Include a sample in your business plan to help sell your concept, even if you haven’t finalized it yet. Consider including a fully designed sample menu to really wow your reader. Create online for free with simple drag and drop menu templates.
Floor plans and architectural renders can bring your concept to life. If you don’t have these, include a mood board to demonstrate your vision, and get ideas by doing online research.
Spend time researching ideas and developing your restaurant name, logo, values and personality. Curate an image that stands out and connects with your target audience.
If you have a team at the ready, highlight their skills and experience. Include a resume-style summary for key management. If you’re yet to appoint your staff, include a plan for how you will attract and retain the best team through your leadership, policies and culture.
3. Market analysis
This section details your target audience, proposed location, and competitive environment.
Who are your ideal customers? What are they looking for? Maybe they are college students aged 18-25 who live within 10 minutes of your venue, wanting cheap drink deals, fast service and late-night opening hours. Be as specific as you can and be clear on why they would choose you over other offerings in the area.
If you’re opening a new restaurant, you might not have chosen your exact location when you’re writing your business plan. Totally normal. Just describe the area you’re targeting and how it aligns with your target audience’s demographics. Highlight growth in the local economy, major infrastructure and things that will drive visitation to your restaurant.
How many other restaurants are there in the area? How are they faring? What makes you stand out? Why will customers choose you?
4. Marketing plan
Your restaurant marketing plan details how you’ll promote your restaurant before and after opening. It needs to be a comprehensive plan showing how you’ll grow your business. Consider using digital marketing, advertising, promotions, partnerships and events to reach your target audience and encourage them to become customers:
- Advertising: social media, digital display ads and newspaper ads
- Social media: a solid social media presence is a must. Set up Instagram and Facebook at a minimum
- Reviews: 94% of diners read online reviews to choose their restaurant. Set up your accounts on Google My Business, TripAdvisor and Yelp so that you can keep track and respond to reviews
- Website: with 93% of customers looking at a menu online before choosing a restaurant, a website is essential
- Email marketing: use creative contests to build a database of email addresses so you can send updates and offers to customers
- Letterbox drop: in this digital age, old-school techniques like this can still work to reach local customers
- Loyalty programs: create a frequent diner’s program with exclusive member-only deals and events
- Partnerships with local businesses: for example you could offer lunch deals and establish catering arrangements with big local employers
- Sponsorship of local charities or community organizations
- Events: hold regular events that draw in crowds, like holiday-themed dining or live jazz music on a Sunday afternoon
- Digital signage: there’s no better way to grab the attention of diners. Digital signs boost average daily sales by 30% because they drive foot traffic and temptingly display your menu items
5. Operations plan
The operations plan details how you’ll run your restaurant. By systemizing your operations, things will run more efficiently. Your operations plan can become the blueprint for staff training and an operating manual followed by all employees.
- List of positions, roles and responsibilities and pay rates
- Number of people needed for each position
- Recruitment plan and interview process
- Onboarding and ongoing training plans
- How you plan to be an employer of choice that retains great staff
Daily operating summary:
- Describe the daily routine of the restaurant
- Show that management is running a tight ship
- Include ordering, receiving, food production, waste management, safety, cleaning and maintenance processes
List of suppliers:
- Your suppliers are critical to the success of your restaurant, so list their credentials to show you’ve chosen reliable partners
- Describe your required standards and what will trigger the need for replacement
Customer service standards:
- Have policies for establishing customer service standards so diners have a consistently positive experience
- Include how you’ll deal with customer complaints
- Online bookings and home delivery systems
- POS system for taking payment and tracking sales
- Employee scheduling, attendance and payroll system
- Inventory control
- Digital signage to easily update menu and prices. Choose a system with reporting and analytics to track the effectiveness of your promotions.
6. Financial analysis and projections
You’ll need to show your start-up costs, anticipated revenue and expected expenses. Be realistic – there’s no point exaggerating the potential to secure investors if you can’t pull it off. It’s a good idea to get an accountant to help you complete this section. Try to find someone familiar with the specifics of restaurant finances. Include:
Detail the capital you’re looking to secure and how you plan on spending it. There will be lots of expenses as you set up your restaurant, so include all costs including equipment, furniture, legal fees, supplies and payroll.
Have your accountant prepare a projected profit and loss statement using educated guesses. A break-even analysis will show what monthly revenue you need to cover costs. A cash-flow study should demonstrate how the restaurant will generate enough income to support itself.
Make sure your business plan is professionally presented. Hire a graphic designer or DIY on Canva.
If you share your business plan with potential investors, be sure to have them sign a confidentiality agreement, especially if you don’t want your innovative concept to be copied.
Know your plan inside out so you’re ready to answer every curve ball question thrown your way.
Good luck with everything!
You’ll invest a pile of time and effort in creating your restaurant business plan, but it’ll be well worth it in the long run. Your final document will give you (and your investors) confidence that your dream of running a successful restaurant is achievable.