So, you want to start a restaurant. You may have heard the old myth that the majority of restaurant businesses fail within one year of operation, but only 17% of restaurants actually close before their first anniversary. If you want to hear even more good news, there are several steps you can take to avoid becoming part of that surprisingly small failure statistic. Here are four things you need to know before opening your restaurant’s doors.
How to Finance Your Business
Unless you were born into a rich family, you’re going to need financing options to get your restaurant started. From renting a building to paying workers and ordering supplies, the cost of starting a restaurant can be steep. You can borrow all the money you need up front, or hire investors to finance your restaurant in exchange for a cut of the profits.
Your Restaurant’s Concept and Menu
Chances are that you already have your restaurant’s concept in mind, but it’s important to fully flesh it out and develop your full menu before opening night. Your concept and menu are also important for advertising and marketing. For example, you wouldn’t market a vegetarian restaurant to the same audience as a steakhouse or a family buffet to the same audience as a bar.
Where to Source Ingredients and Supplies
Restaurants depend on a steady source of supplies and food ingredients, and any glitches in the chain can bring your business to a screeching halt. Make sure to do your research and find the highest quality, most reliable sources of everything from freezers and ovens to kaiser rolls and tomatoes. Choose local suppliers whenever possible to reduce the chances of something going wrong along the way. Local sourcing is also better for the environment than trucking items across the country. Sourcing for the right food suppliers may not be an easy task, finding the reliable one can help you build your reputation and success.
Location is Everything
Location isn’t just the first rule of real estate. If you want to keep customers rolling into your establishment, you will need to pick a prime spot. For a fast casual restaurant, choose a central location with lots of foot traffic, but look for a more secluded spot where diners can enjoy peace and privacy if you’re planning an upscale restaurant.
Keep in mind that your restaurant may fail even if you do everything right, so don’t get discouraged if your business venture never gets off the ground. The important thing is to learn from your mistakes and use your hard-earned knowledge to help your next project succeed.