Starting a Restaurant – Do’s and Dont’s
Unbeknownst to many entrepreneurs-in-training, opening a restaurant is one of the riskiest endeavors one can undertake. From finding exactly the right locale to investing in the freshest of ingredients, a host of elements must be considered. From a restaurant consultant standpoint, the primary importance is to ensure enough capital is available for the venture – on average, anywhere from $50,000 to $150,000 is required to open the doors of a restaurant, that figure being reduced if existing kitchen equipment and the like is readily available. However, many costs go into that figure – food enough to last for that initial six months to a year, enough labor dollars to pay a staff (in that same six months-to-a-year time frame) and of course garden variety bills. All this must be considered very carefully by the prospective restaurateur beforehand because initially – and this is just fact – revenue won’t be streaming in with any sense of urgency; typically, restaurants just don’t turn a profit right away and clientele must be built to make this happen.
In what’s a rather alarming statistic, 75 to 80 percent of restaurants go out of business in their first year. As an increasingly difficult business to master and succeed in, owning a restaurant is a prospect that should be carefully researched, according to master restaurant consultants. Factors such as location, knowledge of PNL and control of laborers and food cost are really just the beginning of what needs to be taken into serious consideration. According to professional restaurant business consultants, most people fail in this arena because they feel they could open up a restaurant just because, say, they could cook or perhaps have simply eaten in a restaurant. To the contrary, this is more a science with only 20 to 25 percent of attempts actually succeeding due to the sheer fact that these folks actually did their homework.