To ensure your restaurant business success in this highly competitive market, you need a properly structured business plan for your restaurant. With over 12 years of experience, we have helped over 5,000 entrepreneurs create business plans to start and grow their restaurant businesses.If this is your first time writing a business plan, we’ll walk you through these sections and give you some key things to consider.
In the three years up to 2021, the restaurant industry experienced revenue growth. Due to solid growth in the income levels of affluent consumers, the fine-dining segment performed particularly well over the past five years.
Consumer spending is likely to increase an annualized 2.5% over the three years to 2024.
As the Coronavirus subsides, industry revenues are expected to grow at a rate of 3.9% to $210.8 billion over the three years to 2024.
There are 6 factors that can help you boost profitability, efficiency, and ultimately success in the restaurant industry despite the challenges.
A business plan for the restaurant is a written document that sets your company’s financial goals and discusses how you’ll reach them.
A solid, comprehensive strategy will serve as a road map for the next three to five years of the restaurant business. Any bank or investor you approach will require a business plan for restaurant, so putting one together will be critical to securing funding.
In short, writing a business plan can help you succeed if you’re thinking of starting a restaurant business or pitching to investors or venture capitalists.
Do you need help creating a business plan? Check out these six free, proven business plan examples from different industries to help you write your own.
If you want to start a restaurant business or expand an existing one, the first thing you need to do is to write a business plan. A business plan is also necessary for attracting investors who want to know if your restaurant is on the right track and worth investing in.
A solid, detailed plan gives you a clear path to follow, forces you to examine the viability of a restaurant business idea, and may help you better understand your company’s finances and competition.
Restaurant owners who have a business plan grow 37% faster than those who don’t, and 76% of fast-growing businesses have one.
A restaurant business plan is a living document that should be updated annually as your company grows and changes.
Asking family and friends to invest in your restaurant business is a great way to start. Once you’ve set a budget and identified what you’ll need to start the store, take the services of your friends and family to help you get it off the ground. You might need to present the willing ones a solid business plan to reassure them that their chances of making a profit are good.
Bank loans and angel investors are the two most common sources of funding for a restaurant business. When it comes to bank loans, banks will want to look over your restaurant business plan to make sure you’ll be able to pay it back with interest.
The loan officer will not simply want to ensure that your financials are reasonable in order to gain this confidence. They will, however, expect to see a professional plan. They will be more confident in your ability to run a business successfully and professionally if you have a plan like this.
To write a restaurant business plan, you don’t need to be an expert. Our step-by-step guide will show you how to write a business plan for restaurant business, or you can just download our proven sample business plans to get a better idea.
The executive summary is the most important part of the document since it outlines the whole business plan. Despite the fact that it appears first in the plan, write the executive summary last so you may condense key concepts from the other nine parts.
It’s a part that catches the investor’s eye and provides key information about your company’s overview and upcoming short- and long-term goals.
Tell them what kind of restaurant business you have and what stage you’re in; for example, are you a startup, do you have a restaurant that you want to expand, or do you have a lot of restaurant business?
Finally, an executive summary should provide investors with a preview of what they may expect from the rest of your document.
Check out these executive summary examples to help you write a perfect one for your business plan.
An executive summary is the most important part of your business plan, and it need not be challenging to write. This is why we have put together some awesome free Executive Summary examples for you.
The company analysis follows the executive summary as the second section of a business plan. Your company overview will be short and clear, similar to the executive summary.
Even if they just have a few minutes, your reader has to understand what your company does and who your customers are.
The following sections will be included in your business plan’s Company Analysis:
You need to include an overview of the restaurant business in the industry analysis you performed before sitting down to write your restaurant business plan.
While this research may appear to be unnecessary, it helps you to build strategies that maximize business opportunities while lowering or avoiding the identified risk.
You may learn a lot about the restaurant industry by doing research. It helps you in understanding the market wherein you operate.
The third purpose for conducting market research is to demonstrate to readers that you are an industry expert.
Industry analysis can be presented as a 8-step process when written as part of a company’s business plan.
The customer analysis section is an important part of any restaurant business plan since it evaluates the consumer segments that your company serves. It identifies target customers, determines what those customers want, and then explains how the product will meet those requirements.
Here are some examples of customer segments: Business executives, Couples, College students, techies, workers, etc.
Customer analysis may be divided into two parts: Psycho-social profiles (why your restaurant services and products suit a customer’s lifestyle) and Demographic profiles (descriptions of a customer’s demographic qualities).
In terms of demographics, you should include information on the ages, genders, locations, and income levels of the consumers you want to serve. Because most restaurant serves consumers who live in the same city or town, such demographic data is easily accessible on government websites.
The psychological profiles of your target clients reveal their wants and needs. The better you understand and identify these demands, the better your chances of attracting and retaining customers will be.
It is necessary to do a competitor analysis. Not least because you may use their data to define your goals, marketing plans, tactics, new product lines, pricing, and more. Use competitor analysis to:
On the market, you will almost certainly discover some extremely powerful competitors, some of whom will be offering things similar to yours at unbelievably low costs. However, not every competitor works with low-cost, low-quality services.
The first step is to determine who your direct and indirect rivals are.
The direct competitors consist of other restaurant businesses that offer essentially the same products to the same people as you do.
Indirect competitors are more difficult to detect. They can sell a variety of cuisines or follow a different service model. However, because they serve the same target market, these businesses are competitors.
While indirect competitors may not serve the same meals, they compete for the same hungry customers. Restaurants, supermarkets, and customers preparing meals at home are all included.
Once you’ve identified the competitors, concentrate on the direct, head-to-head competitors, since they are the most threatening to your restaurant business — but keep an eye on the indirect competitors as well, just in case.
You will be able to position yourself competitively in the market if you perform proper competitors research. Perform a SWOT Analysis to learn your competitors’ strengths, weaknesses, and competitive advantages in the following areas:
The final section of your competitive analysis should include a list of your areas of competitive advantage. for example: Are you going to offer premium services and products? Will you offer unique services and products that your competitors don’t offer? Will you offer better pricing or will you offer greater customer support?
Consider how you will outperform your competitors and include them in this portion of your restaurant business plan.
Take advantage of our free SWOT analysis examples. Make your business future-proof by identifying your strengths, weaknesses, opportunities, and threats using this free SWOT Analysis Template.
Creating a marketing plan for a restaurant business involves identifying the target demographic and finding products that suit their preferences. Restaurant owners need to constantly seek out restaurant businesses that their competitors do not carry.
As part of your marketing plan for a restaurant, you should include:
Pricing and Product Strategy
Your restaurant business must offer services and products that are unique, need in public, and different from those of your competitors. Research what your competitors carry and how they price their products. A unique restaurant collection identifies your store as the place to go for a unique restaurant business and differentiates it from others.
Placing and Promotions
The location of your restaurant business is referred to as place. Make a note of where you’re going and how it’ll affect your success. Your restaurant should be located somewhere with a lot of foot or car traffic to attract first-time customers. The more people who walk past your restaurant, the more likely you are to attract new customers.
Is your restaurant facility, for example, near a major highway or public transportation? Discuss
how you can ensure a steady flow of customers at your location.
Promoting your restaurant is the final part of your marketing plan. In this step, you document how you will drive customers to purchase your restaurant. A few marketing methods you could consider are:
While the previous sections of your restaurant business plan described your goals, your operations plan discusses how you will achieve them.
An operations plan is helpful for investors, but it’s also helpful for you and employees because it pushes you to think about tactics and deadlines.
Your operations plan should be divided into two individual parts, as seen below.
All the daily tasks involved in running your restaurant business, such as serving customers, cleaning restaurant, procuring supplies, etc., are short-term processes.
Long-term goals are milestones that you aim to reach. These may include the dates when finalizing the lease agreement for the restaurant space or Reach break-evens. It might also be when you plan to launch a new restaurant business or to serve 1000th customer.
When writing a business plan for restaurant, the management section’ outlines your management team, staff, resources, and how your business ownership is structured.
A strong management team is necessary to demonstrate your restaurant’s ability to succeed as a business. Highlight the backgrounds of your key players, emphasizing the skills and experiences that demonstrate their ability to grow a business.
You and/or your team members should ideally have prior experience working in a restaurant company. If so, emphasize your knowledge and experience. However, you should emphasize any experience that you believe will help your restaurant business succeed.
Consider forming an advisory board if your team is lacking. An advisory board would consist of 2 to 8 people who would act as mentors to your company. They would assist in answering questions and providing strategic direction. If necessary, seek out advisory board members with experience running restaurant and small businesses.
As part of your financial plan, you should present a 5-year financial statement broken down monthly or quarterly for the first year, and then annually. Business financial statements include your income statement, balance sheet, and cash flow statement.
A profit and loss statement is more commonly called an income statement. It shows your revenue and subtracts your expenses to determine whether you were profitable or not.
As you develop your income statement, you need to develop assumptions. For example, will you serve 20 clients per day or 50? Will sales increase by 3% or 15% per year? As you can imagine, your assumptions have a significant impact on your financial forecast. Do your best to verify your assumptions by conducting research.
Create a financial statement for your business by downloading our free income statement templates.
While balance sheets include much information, to simplify them to the key items you need to know about, balance sheets show your assets and liabilities.
The balance sheet shows your restaurant’s net value at a specific point in time. It categorizes all of your company’s financial data into three categories:
The equation that expresses the relationship between these financial data elements is Assets = Liabilities + Equity.
Create a pro forma balance sheet for your restaurant business plan that highlights the information in the income statement and cash flow projections. A balance sheet is normally prepared once a year by a company.
Balance sheets indicate your assets and liabilities, and while they contain a lot of information, they are simplified to highlight the most important things you need to know.
For example, spending $150,000 to build out your restaurant business will not result in instant revenues. Rather, it is an asset that should help you earn money for many years to come.
Similarly, if a bank sends you a check for $700,000, you do not have to pay it back right now. Rather, that is a liability that you will repay over time.
Create a financial statement for your business by downloading our free balance sheet templates.
List any additional material you cannot include elsewhere, such as resumes from key employees, licenses, equipment leases, permits, patents, receipts, bank statements, contracts, and personal and business credit histories.
Attach your full financial projections along with any supporting documents that make your plan more compelling in the appendix. You may, for instance, include some of your apparel designs.
A business plan for restaurant is a worthwhile investment. As long as you follow the template above, you will become an expert in no time. By following the template, you will understand the restaurant business, your competitors, and your customers. The plan will help you understand the steps necessary to launch and grow your restaurant business.
Wouldn’t it be nice if your business plan could be completed faster and easier?
With wise business plans Business Plan Template, you can finish your plan in just 6 hours or less with a 30-Day Money-Back Guarantee!
In addition, you can download our 300+ free business plan templates covering a range of industries.
OR, we can develop your restaurant business plan for you
Since 2010, Wise business plans’ MBA professional business plan writers has developed business plans for thousands of companies that have experienced tremendous success.
We will show you some real-world business plan examples so you may know how to write your own, especially if you are seeking a bank loan or an outside investment and need to use SBA-approved formatting.