Many of our clients are interested in the hospitality sectors and we ourselves started our first business in this area. We wanted to share our ideas on the ten steps to follow if this is an area of interest to you.
1. Scale your Restaurant – Without deciding on an exact property, what does your business look like? How many tables does it have? How big is it? Is it takeaway, fast food or fine dining? At this stage, it’s only important to have an idea of the size of the property.
2. Understand the Budget – No matter if you are selling burgers, biryani or bolognese – eventually, your plans can only be realised if you have the money to do it. Draw up a list of the big expenses like
3. Sources of Funding – Once you understand the approximate budget needed, how will it be funded? Savings? Family contributions? A business loan? If this is a new business, most banks will not provide a loan until trading has taken place for at least 6 months. UK Government StartUp loans can be available for up to £25,000 for true start up businesses, as do other start-up funding banks. (Within the Bayleaf Group, we operate an angel investment business which provides funding for hospitality businesses.)
4. Find Some Suitable Properties – Do some research in your target area to see what is available in your size / budget. Is there a lot of choice? Are there properties in good locations? Do they fit your concept?
5. Build the Brand & Concept – Finally, the sexy part. Although you already have some ideas about the nature of the business you want, now is the time to start to put meat on the bones. What will you sell? Who is the target market? What about competitors?
6. Develop a Draft P&L – Choosing one property as a “target”, start to build the operational details around the business. This is complex and we can help you with this. But start simply
7. Write a Menu – What will be on the menu and how will it be priced? What about drinks options? Will the kitchen always be open or will there be times with only drinks?
8. Select a Favourite Property – Which of the properties you have seen seems to fit best? Work with an agent to get real details of the state of the property and any costs involved
9. Calculate P&L & Start-Up – Based on your favourite property, you can now develop a more definite P&L to understand whether your planned operation (with real rents, wages, menu prices, hours etc) can make money on an operating basis, and whether start -up costs are affordable
10. Finalise and Go!