Ebrahim alahdal - A_1.1: Prepare For Your Business Plan. Restaurant Business Plan Sample Outline Use this sample outline to help you build your own restaurant business plan. Feel free to copy and paste this entire section in a Microsoft Word file or Google Doc, and then replace the explanations for each section with information for your own restaurant business. Section 1: Executive Summary The executive summary should simultaneously serve as a summary of your key conclusions and an invitation to read more. There’s plenty of writing to follow this section, so for readers that want a basic look at your restaurant’s feasibility and its business model, briefly speak to these points: ● ● ● Your restaurant’s name, concept, and cuisine Your market position and competitive advantage Your financial projections and break even point in sales and in days All-in-all, this section should be about 200-600 words max, and should be convincing enough for any investor reading to want to know everything else about your restaurant business idea. Section 2: Company Description This section should provide readers with a high-level overview of the idea of your restaurant. Each subsection focuses on a different aspect of your restaurant that investors will want to know. This part of the plan can easily be mundane for readers – chances are your potential investors have seen dozens or even hundreds of restaurant business plans. So, do what you can to spice this section up and show your passion for this project with exciting and detailed language to help your business plan stand out. Concept What’s the general concept for your restaurant? You may want to speak to: ● ● ● Your level of service (fine dining, fast casual, etc.). The cuisine you’ll offer (Thai, pizza, etc.). The types of food and/or drink you’ll be selling. Mission Statement Your restaurant's mission statement should boil down the essence of why you’re starting this new venture in just a few words. Some mission statements are short and to the point, like Ninety Nine’s (“A Passion to Serve”). However, if your mission can’t be simplified in just four words, there’s no harm in elaborating. Jamba Juice’s mission statement (“To become the world’s leading blender of fruit and other naturally healthy ingredients”) is a bit wordy by comparison but clearly speaks to the company’s unique position and menu offerings. Management and Ownership This is the section where you’ll talk about yourself and the team you’ve already assembled. For example, you may highlight that you – as the owner – have 12 years of restaurant management experience and are a member of the National Restaurant Association and that you’re joined by a head chef who trained with Wolfgang Puck and a General Manager who has been an industry consultant for the past four years. Divulge what it is about the restaurant’s leadership that will make the business more efficient and profitable than another restaurant without your team’s talent. Section 3: Market Analysis This is where to cover how you’ll be positioned in your market, the target market you’re hoping to appeal to, and what you’ll do to catch people’s eyes. Location Provide the location where your restaurant is or will be. If the location is not set in stone just yet, write the name of the town or neighborhood you intend to do business in. Competitive Analysis Explain how your restaurant will stand out the sea of restaurant competition the world is facing right now. A good idea is to include a SWOT analysis for your restaurant, outlining the internal strengths and weaknesses you believe your business would have, as well as any external opportunities and threats you’d face. Here are examples of each: ● ● ● ● Strengths: Combined 30+ years of restaurant experience from the leadership team. Weaknesses: Needed ramp-up time for staff could set our financial projections back. Opportunities: Our location is near several office buildings, suggesting we would have a steady flow of white-collar lunch customers and after-work dinner guests. Threats: An established restaurant of a similar concept is close in proximity, posing a direct threat to our potential market share. In your SWOT analysis, you should identify how you intend to overcome the weaknesses and threats your restaurant will face to reassure investors they won’t be the downfalls of your business. Market Size and Demographics Here’s where you’ll explain the tactics you took in conducting your market research and the results of those findings. You’ll want to highlight the most relevant statistics you found pertaining to your restaurant business. For example, if you’re opening a coffee shop, you may cover that your primary research concluded that 24-36 year-olds make up 40% of your area’s population, and research from other outlets suggested that coffee consumption for millennials continues to rise. This would lead to a convincing, research-based conclusion that the coffee shop could be a realistic and profitable endeavor for the area. Marketing and Position Strategy How will you reach your target audience? Sticking with the above example of a coffee shop, you may want to talk about your restaurant advertising ideas for millenials, like using Instagram marketing to promote your menu items and loyalty program. You’ll also want to take a stance on how you’d like to position your restaurant’s brand and how you’d like it to be perceived. 65% of consumers feel an emotional connection to brands, so the stronger emphasis you place of yours, the more likely your target market will notice – and identify with it. Chipotle, for instance, is synonymous with convenience and sustainability largely because the restaurant chain’s leadership emphasizes those values in their brand positioning strategy. Section 4: Operations Plan Let’s get down to the nitty-gritty. Some investors will want to see how all the moving pieces will mesh on a day-to-day basis with a detailed operations plan. This section should encompass your staffing strategies, what technologies and equipment you’ll use, and what your restaurant layout may be. Staff Hiring restaurant staff is one of the most difficult tasks in the foodservice industry. Recent statistics actually showed the number of people working in restaurants is on the decline. Coupled with the fact that workers in the industry are seeking higher wages – which would drastically increase restaurant labor cost – and the notoriously high staff turnover rate, investors familiar with the restaurant scene may be skeptical when you say you’ll have a reliable and sizable staff showing up every day. Put these minds at ease by outlining your hiring and retention tactics, such as proactive candidate sourcing, good benefits, and unique employee engagement strategies. In Restaurant Success by the Numbers, Fields also suggests surveying your area’s labor environment to get a pulse on who would be working for you, as well as listing “prevailing local salary and wage rates, and [telling] how they fit into your budget” in your business plan. This will show readers how you intend to attract and pay for staff members. Technology One of the good things about opening a restaurant today is the abundance of helpful and innovative restaurant technology solutions. Write about your choices for point of sale software, inventory management software, and employee scheduling software. Many older restaurants still use antiquated technology in these areas, allowing you to take advantage of newer tech and gain a competitive advantage in efficiency. Kitchen/Back-of-House Talk about the details of the back-of-house in your restaurant, such as the commercial kitchen equipment your cooks and chefs will be wielding during their shifts and what the kitchen layout and workflow will be. If you have visual aids – such as a floor plan of the kitchen – you can include them here and/or attach them in the appendix. Here is also a good time to talk about processes you plan to adhere to in the back of house, such as food cost control methods and food inventory suppliers. Restaurant food costs are substantial, so explaining to investors how you’ll keep them lower than the average restaurant should impress. Section 5: Financials Don’t be offended if you see investors skip straight to this section. After all – no matter how mouthwatering the food sounds and how reasonable the market assessment comes across as – a business comes down to making money. So before you finalize this plan, quadruple check these projections, and consider running them by a hired financial professional in your area. Sales Forecast A conservative yet confident restaurant sales forecast should highlight your projected weekly, monthly, and/or annual first-year sales projections. You should base this forecast off of a few different criteria, such as capacity limits, table turn, delivery and/or takeout options, reasonable first-year month-over-month growth expectations, hours of operation, and menu prices. Startup Costs Any good investor will want to know what his or her money will be going to. Disclose how much money you’ll need to get this project off the ground, identify the biggest expenses, and don’t be afraid to put a line item in for working capital – which is basically a reserve fund for your first few (likely slower) months of operation. Projected Profit & Loss Statement Use a projected (or pro forma) P&L statement to show investors how much money you expect to have made – or lost – by the end of your first year. This should be based on your sales forecast, as well as your projected restaurant costs (both for opening the restaurant and for operating it throughout the year). Break-Even Analysis It’s an unforgettable day for a restaurant owner when the business becomes profitable – and you can determine that point in time with a break-even analysis. Calculating break-even will project the threshold to reach in time and in sales to pay back investments and startup costs, thus reaching profitability. Show investors how you reached your break-even point with a break-even calculation. You can reach this number by dividing total fixed costs by the difference between average revenue per guest and average variable cost per guest. Alternatively, plug those projections in this formula to produce break-even dollars: Break Even Point = Total Fixed Costs / (Avg. revenue per guest - Avg. variable cost per guest) You can then compare this number to your sales forecast to determine a timeline for break-even point in days to let investors know what day they’ll start seeing an ROI. Section 6: Appendix The appendix and its contents are all optional, but this section could contain charts, plans, graphics, imagery, or any other material investors may find useful. Sample Menu Provide one of your restaurant menu ideas if you have any drafted. This will provide a visual aid for the work you’ve done on branding, pricing, food item selection, and menu engineering. Floor Plans As mentioned earlier, the appendix is the perfect place to include any mockups of your restaurant floor plans. These plans give readers an idea of how guests and employees will be able to maneuver through and interact with each other in the space. Additional Financial Charts Got supporting financial documents, like projected cash flow and a projected income statement? Awesome. Place them in here to show investors you really know your numbers. Design Mockups If you’ve worked with a building renovator and/or interior designer, include any graphic mockups of what the space would look like. Again, this section is completely optional, but it helps investors visualize the project you’re so passionate about and proves to them that you’ve gone the extra mile in your business research and preparation.
