10 Top Tips to Opening a Restaurant
There are a few “How to” guides on the internet that show you the steps you need to perform to open a restaurant but these just outline simple headings like “Raise money” or “Create a business plan”. This is a more in depth look at practical tips that will help you open a restaurant from people that have done it.
1) Create a pitch deck:
Whether you have all the funds secured or not… creating a pitch deck is a really useful tool for anyone wanting to open a restaurant. It creates a snap shot of what the business is going to be, what you will be serving, the direction of the offering, who you will be targeting and more. All pitch decks are different but we would say… The more visually appealing the better. The document should be a PDF format and be around 10 pages long. It can be sent to potential investors, friends (for help and support), brands (for investment or collaborations), suppliers, used as part of a business plan or sent to banks to help with loan applications.
A good pitch deck should have the following content:
Title page
Mission Statement
Business Pillars
Outline what you will be solving
Food & Drink Direction
Rough Financials
The Team
Possible Exits or Expansion Plans
After creating the pitch deck it will help you focus and outline the direction of the business. It should help you decide on a name, branding, a possible logo, mission statement, some thought on market reseach and where your venue with position itself. You should also partner your pitch deck with a P&L. This will mean you have thought about costs of the project (for a Return on Investment (ROI)) but also set monthly budgets in terms of revenue and expenditure.
2) Apply for EIS or SEIS relief:
This should really be more common knowledge but all restaurants should qualify for:
Enterprise Investment Scheme (EIS)
https://www.gov.uk/guidance/venture-capital-schemes-apply-for-the-enterprise-investment-scheme
Seed Enterprise Investment Scheme (SEIS)
This will help you when raising money for your project as the schemes allow potential investors to claim 30-50% of their investment back from the government. It will be processed by HMRC with the monetary value being deducted from your taxes and will be able to be processed within a few weeks of being granted. The relief can be applied to previous years taxes and can also be kept to be used for a few years after the investment. This limits investors potential for losses and so is a unique selling point to get people involved in the project.
3) Set VAT to be processed monthly at the start:
Managing the business’s money impacts all aspects of any business. Having a very pro-active book keeper can make this process much easier and also help with cashflow. At the beginning of any restaurant build you will obviously need to apply for a VAT number. VAT is applied to all bills generated by the business but until you start trading money will only be heading in one direction… out!. You will be paying designers, architects, equipment, lawyers etc. All of these services will have VAT attached to them but as you don’t have any income coming in you will be VAT positive. Usually VAT is paid quarterly (every 3 months) but it can be done monthly. If you set your VAT to be processed monthly then you can claim back the money you have spent and get it back into the business. Every penny helps at this point.
4) Hire the right head chef:
This is such an obvious point to make but the right chef can be the difference between crying yourself to sleep and having a stress free life. A good head chef will be able to deliver your vision, in an organised kitchen, costed correctly with no dramas or tantrums.
There are many ways to recruit a head chef (Job Today, Indeed etc) but I would say you would find a better calibre of chef at https://www.caterer.com/
I would post an advert, go through all the applications, meet as many as possible, get them to perform a “cook-off” and then narrow down to a top three. You will probably have to juggle kitchen skills, with temperament and back of house skills. It will be up to you to decide what is more important. If you find one that has all three then I would love to hear from you as they would be considered “a unicorn”.
5) The power of 3 quotes:
In any scenario, whether it would be hiring a chef, supplier, architect, designer… anything… Get three quotes. This will give you enough of a spectrum to justify any decision you make.
6) Create budgets and review weekly
As we have stated. Money is KING. So being on top of all expenditure is essential. During a build it is easy for things to get out of hand and overspend on a build or pay for hidden costs. You may not have considered a rent deposit or you have have had to clear asbestos from a ceiling. All these things can affect your cashflow.
During the process of creating a busines plan or creating your pitch deck, you should have done some estimates on your build spend and your ROI. This means you should know how much you are spending on your build. Regular/weekly evaluations of how much you have spent/overspent will mean you can make adjustments in real time. It will mean there are no shocks and allow you to make well informed decisions.
7) EPOS choice:
EPOS stands for Electronic Point Of Sale (your till system). Like with anything in hospitality, there are hundreds of options for any business/restaurant. It is a very expensive piece of kit and is something that will be used every day (both BOH (back of house) and FOH (front of house)). All EPOS have roughly the same features but there is so much scope across the board. Some have integrated stock sytems, payroll/rota-ing, reporting but there is no front runner that can do EVERYTHING. The best thing to do is to ask for a trial/presentation from multiple EPOS providers and test to see what suits you best. Some have great reporting in a graphical way, others in terms of tables. Some have data that can be easily exported and some where nothing can be. It depends on your exact business but testing/trialing any EPOS is essential.
Some of the better ones out there are:
Square: Super basic in a good way - integrated credit card payments.
Tevalis: Expensive but comprehensive - covers most bases
Lightspeed: Easily programmed - good BOH
8) Video the build
There is a cost involved with this but I can’t stress how much content you get from videoing the build of a project. You can use the footage to create amazing content that can be used to launch your venue. It can also be used later for advertising campaigns (Instgram/Facebook). The process is very visual and captures the imagination of all people that watch it.
Here are some examples of videos we’ve done in the past - Here.
9) Have a friends & family launch night:
It doesnt matter how prepared you think you are… when you open those doors… anything could happen. Having a night where you invite your friends & family, gives you amazing operational insights and also essential feedback to improve everything. Supply little feedback cards and collect them at the end of the night. People will see things you have never even thought of. You wont know if your toilets block after 100 people use them in one night until you have 100 people use them in one night… Trust me this has happened.
10) Collect email data when people log into your WIFI:
Keeping your restaurant full is the key to making it a success. And due to GDPR restrictions, getting email addresses from clients or potential customers can be tough. We make sure all our venues collect email addresses when people use the WIFI so you consistently add new customers to your marketing list.