Every business needs a business plan. It may not be the first thing you want to do when you make the move to branch out on your own. But it is always well-advised. Hence, as an aspiring restaurateur, a restaurant business plan is something you should already be considering today. By the way, if you’ve already opened your business, or are simply in the middle of an upgrade, it’s not too late either. In fact, it’s rarely too late to start planning ahead. And planning ahead is essentially what writing a business plan for a restaurant lets you do.
The Importance of Creating a Restaurant Business Plan
A business plan has two main purposes. The first is that it helps you spell out your goals, as well as the steps you need to take in order to achieve them. This includes short-term aims and actions, as well as long-term objectives. You could say it’s the blueprint or roadmap to running your restaurant business successfully. As such, it should be as detailed as possible, covering all aspects of your business operations.
The other purpose of creating a restaurant business plan is to serve as your company’s resume. That is, it’s a useful document for attracting investors, partners, and even bank loans. Similarly, others use their business plan as a “guide” for employees and vendors, to help them better understand the business, and encourage them to stay on-track in terms of your overall/mutual goals.
The Basic Structure of Any Business Plan
While any business plan is better than none, if you’re going to bother writing one, there are a few things you should consider. First of all, you should start with an outline – in your case a restaurant business plan outline. This will help you keep track of what you want to cover. Next you need to fill in the sections.
Areas you should definitely cover in any business plan include:
- Executive summary – This is a brief summary of your overall business. It should highlight things like what problem you are solving, how you will solve it, your target market, a bit about the founding team, and highlights of your financial forecast. It should be short and engaging. Much like a movie trailer it’s meant to generate interest.
- Outline of the opportunity – Now it’s time to get into the details of the problem you’ll be solving and how. This is primarily about filling a customer need, and the benefits customers will gain from your business. For example, as a restaurant owner, you may have noticed there is no Mexican food in a 100-mile radius. If you’ve done your research this is the place in your small restaurant business plan to write about that lack, local tastes and culture, and the void you will fill for a hungry audience.
- Execution – This section highlights how you’ll execute your plan. Essentially you should use it to separately outline your marketing plan and sales plan, as well as other logistical questions. This includes very basic things like where your business will be located. You should also list the equipment you’ll need to get started as well as other equipment you hope to acquire in the long-term. Plus, think of the technology and services you’ll need along the way, like special software for running your back office. These are all part of the physical side of execution, or perhaps more accurately the tools. Beyond that, however, this section should also spell out your roadmap to success, including where you want your business to go, and how you envision getting there. Don’t forget to include metrics for success, so you know when you’ve achieved (or missed) your goals.
- Financial details – While you don’t need to get into details like how much your business insurance will cost you here, you do need to get fairly specific. For example, you could begin with a subsection on your revenue/sales forecast. Next, write a subsection about expenses. Then include a section about projected profit and loss and finally, projected cash flow, preferably with tables. Make sure to back up your projections with an explanation about the assumptions you’re making in the text. This adds to your legitimacy and helps you stay realistic.
Other sections you may or may not want to include are a market analysis summary, management summary, and appendix if you have any to add. By the way, if you’re not comfortable writing a business plan on your own, you can always hire a professional to help.
How Much Detail to Include
How detailed you want to be in each section of your restaurant business plan depends on how you’ll be using your plan. For example, if it’s just for internal guidance, it can be fairly lean. However, if you’re using it to recruit investors, you may need to go into more details. Either way, it’s not a novel, so try to be concise, and clear. Also, you certainly don’t need to write each section in order. Many people actually prefer to write the executive summary last, as it’s essentially a summation of all that’s been written. Others, prefer to write it first to give them direction. In other words, write it in a manner that works for you.
Writing a Business Plan for a Restaurant
Writing a restaurant business plan is basically the same as writing any other business plan. But succeeding in the restaurant industry, as you know, is particularly tough. As such you may want to get into more details in your plan – especially if you’re looking to attract investors. For example, since menu is critical to your success, you may want to outline your food type and your proposed menu. Similarly, since restaurant design is so powerful in drawing clientele, this is a good place to include it as well. And if you’re not the chef, make sure to include his or her name in your management team. More so, you may want to include a bit about who you’re going to hire and how, as the staff is super critical here.
What Else to Consider when Running a Restaurant
Writing a business plan is only one ingredient that will help determine your success. This is a competitive space, and the recipe for longevity is a complicated mix. So what else will you need?
Well we certainly recommend restaurant insurance to help you out. But more than that, you’ll need a stomach for a demanding business with a workload that never ends. There are customers to serve, staff to organize, and a pantry to fill. You need to stay relevant and delicious. And you need licensing too. There are vendors to pay, bills to process, and plenty of cleaning up to do in between.
What it takes more than anything is dedication, devotion, and exceptional drive. With those character traits backing you up – alongside the vigilance to follow a solid business plan – you could be feeding happy patrons for a long time to come.