Opening a new restaurant concept and creating a design on a budget is the sensible approach to getting into the restaurant business. Doing so requires the owner to carefully plan where their money will be spent. Just because your budget is smaller though, doesn’t mean that you can’t bring your restaurant concept to life!
Before you begin your project steps in opening a restaurant, it is important that the restaurant idea is clearly defined. We don’t want it to become a moving target, or have you spend money on lease space that may not get used right away.
Synergy Restaurant Consultants has supported many entrepreneurs who have considered opening a restaurant with limited funds. One of the common denominators, and fatal mistakes of many of these passionate entrepreneurs, is that they forgo some of the most fundamental and essential steps of planning before their grand opening. The discovery process (brainstorming what kind of food your restaurant will serve, or deciding on staff uniforms) and feasibility studies (whether or not your idea is something that will sell well), are just as important to the success of your business as deciding on what plates to use.
Opening a restaurant on a tight budget is also a challenge because there is very little room for error. It’s a big investment and Synergy Restaurant Consultants has a proven process that identifies the strengths and weakness of the concept as well as projected cash flow and a break-even analysis. It’s necessary to work through a “discovery process” and conduct your feasibility study before making big financial decisions… because if your idea is not a good seller, you might as well be throwing money down the drain.
Opening a restaurant is simple. Doing it with a smaller budget is too. It’s making the money and retaining customers that is the challenge. Here is a checklist for opening a restaurant that may be of some help when money is tight:
1. Organize your ideas for business and discover a great niche. If you’re having trouble with this first step, try hiring a professional to assist you – Synergy has 30 years of experience in helping customers brainstorm. They and can help you find the PERFECT idea – and turn it into profitable business.
2. Research that idea to make sure it’s going to make you money (something we’re also great at)
3. Know that if you find a building or location for your restaurant that is not ideal – that’s OK! Walk away, there will always be another site that’s even BETTER than the first
4. Negotiate a lease and try to obtain tenant improvement money to back-end some expenses. If you don’t know how to negotiate, DON’T try it on your own. Working with a professional property negotiator can save you thousands of dollars, and may even allow you some other incentives before you sign your lease
5. Consider purchasing used equipment if it will help you with starting the business. Once the business grows and you start earning more revenue – you can always upgrade and get newer equipment.
6. Use the internet to find suppliers for your business needs. Looking for durable baking pans? Want unique dining tables? How about gold-plated silverware or an in-door fountain? ALL of these things can be found online- sometimes at a discounted price!
7. Keep the menu simple to minimize the cost of labor and ingredients. As with used equipment, the menu can always be re-designed
when you have more cash flow.
8. Consider trading goods for services. A friend of ours needed a photographer to take some pictures of his dining area for marketing purposes, but he didn’t have the funds. So he offered a freelancer free dinner for he and his wife in return for taking the photos – and it WORKED! You never know what opportunities are available to you until you go out and look for them.
9. Develop a marketing and word-of-mouth strategy to make sure your grand opening is a SMASH!