Your restaurant business plan is an outline of your future success. A well-formulated plan helps put the big picture together no matter how good your restaurant ideas are.
A business plan helps prove the viability of your thoughts and can provide investors with the information they need to sign on to your project. Investors need to know how you will run your restaurant in a competitive market and how you will overcome any challenges.
Your business plan lets you provide a framework for yourself and others to get your restaurant off the ground. Lack of preparation and a proper plan is one of the leading reasons new restaurants fail within their first year.
Learn how to write a restaurant business plan and avoid many common pitfalls of new business owners. Legal Templates has a free restaurant business plan template to help you get started.
Why You Need a Business Plan for Your Restaurant Business
Too many new restaurant owners fail to put together a business plan. You may think you don’t need one because you know what you want to do. Without a proper business plan, however, you’re moving into a difficult process without a strong framework for success.
When you want people to invest in your business, you need to be able to demonstrate future success. A concrete and carefully detailed business plan is a must. A well-crafted plan increases the likelihood that you will secure investors.
A business plan aims to help you achieve your goals at each stage of your business development and operation. The program will cover operational details, regulatory compliance, hiring practices, and other essential details.
A business plan can also help you turn your vision into tangible goals others can see. With this in a detailed plan, you will be more likely to create a successful and long-lasting restaurant.
How to Write a Business Plan for a Restaurant
Many people don’t know how to start a restaurant business plan without help. A good plan hits the essential details and outlines your vision for the restaurant’s future. However, you don’t have to do this from scratch. A restaurant business plan example can help you get started and know what to include in your plan.
1. Executive Summary
An executive summary is a brief overview of your company. It will outline why the community wants your food and needs your restaurant. This summary section will focus on your intended reader, whether that person is yourself or a potential investor.
An executive summary is a place for brief details rather than an in-depth and fact-heavy outline. Many people consider this the essential part of the plan, as it will outline why the restaurant will succeed.
The executive summary is your chance to capture the reader’s attention. Many people will decide whether to keep reading your plan, so getting off on the right foot is essential. Your executive summary will include information like:
- How will your restaurant be competitive
- The type of food you will serve and a menu
- The target demographics for the restaurant
- An implementation plan
- Outline of competition you will face
- Who the owners and staff will be
- The organizational structure of your restaurant
- Marketing and sales strategies
Many of these details will receive an in-depth treatment later in your plan. They should provide just the key points you want to make to summarize the rest of your business plan.
2. Management Team
Your restaurant business plan should include a section that presents your management team. Here, you detail the responsibilities of each owner, manager, and staff member. You lay out expectations for who will do what in getting the business started. These details also help show investors you are serious and know how to handle the day-to-day operation of a restaurant business.
The management team section should include essential details about the ownership of the restaurant, including:
- Legal names of each owner
- How the restaurant will be legally structured (corporation, limited liability company (LLC), etc.)
- Types of Ownership
- Percentage of ownership for each owner
- Ownership agreement among the parties
Your business plan should also include details about those running the restaurant daily. While there may be some overlap — especially in small restaurants — management responsibilities should be clearly outlined. This information should include the following:
- Full names of any management team member
- Education and background
- Past restaurant or management experience
- Title and summary of job responsibilities
- Any food industry training
- Salary and benefits information
3. Products and Services
Investors want to know what you will be serving and how you know customers will like it. This is where you can get specific and show why people flock to your restaurant. A robust opening menu shows you are prepared and know how to attract potential customers. The products and services section will include your sample menu and any other services your restaurant will provide.
This section should also address other questions about how you will handle your products:
- How will you order the necessary supplies?
- What are the costs of products and the sales price?
- How will you measure sales success?
- Why will customers choose your food over competitors’?
- How will your menu change over time?
Too many new restaurant owners have a great vision and food but don’t know how to execute a successful business. Investors want to know that your food will be good and that you fully understand how to run a restaurant. A restaurant business plan template can help you create a successful plan.
4. Customers and Marketing
You need to know who your customers are going to be. Any successful restaurant understands its key demographics and how it will market its business to these potential customers. Your business plan must outline important information about your customers and provide detailed data about the availability of these customers in your area.
Market research is often helpful in demonstrating that the type of customer you are looking for is readily available in your local marketplace. Supporting information must be available here to show investors you have customers to keep your restaurant long-term.
Marketing strategies and an ongoing plan are essential to the success of a new business — especially a restaurant. It would be best to show how you would make people aware of your new restaurant and engage customers in the future. Your restaurant business plan can include marketing details such as:
- Where will your restaurant be located?
- Will you offer delivery, and what is the range?
- Will you advertise on social media, your website, or other digital marketing?
- Will you use billboards, flyers, or other complex media advertising?
- What is your advertising budget?
These crucial details demonstrate you have a real plan for your restaurant’s success.
5. SWOT Analysis
A SWOT analysis for your new restaurant will focus on four key areas:
A SWOT analysis addresses difficult questions in an easy-to-read format. It is a business tool that helps to analyze how your restaurant will perform against your competition. It will look at internal and external factors that may help or hurt your future business.
This data is based on real-world facts rather than ideal conditions or best hopes.
The financials section details the key areas of financial performance for your business. This includes information about start-up costs and break-even points. It also shows how and when the company can profit and see a return on investment.
The financial section should include the following:
- Monthly expenses — supplies, payroll, rent, etc.
- Price points for all products
- Projected revenue
- Mathematical projections for the restaurant
- Variable costs of the business
- Financial records and cash flow statements
Your restaurant business plan must address how your restaurant will run. While this includes details about products and services, it will also cover other critical operational details such as:
- Employment requirements
- Business hours
- Licensing and food inspection requirements
- Cleaning procedures
- Restaurant design
- Mission statement
- Restaurant location
Investors want to see precisely how you will run your business and how you will do it successfully. People often hesitate to invest in a restaurant, as many eateries fail within the first year.
However, a strong business plan showing you understand your specific operational issues will go a long way to alleviate these concerns and get you started on the right foot.
The appendix section allows you to include other valuable documents and information at the end of the business plan. This may be information that does not fit well into different sections or is supporting documentation for the information in the primary areas. An appendix might include, but is not limited to:
- Letters of reference
- Legal permits and licensing
- Customer reviews of food and services
- Pictures of people enjoying your food
- Restaurant design sketches
- Photos of a proposed restaurant location
- Market research
The appendix lets you end on a good note. You can provide additional information to bolster the rest of your business plan.
Restaurant Business Plan Example
Your restaurant business plan should be comprehensive and easy to understand. The prospect of putting one together can feel daunting without some help. A restaurant business plan sample can help you start and tell you what to include.