The restaurant industry is, without a doubt, booming around the world. With the rise of the “foodie” culture in the last two decades, popular urban hotspots are becoming bustling beehives filled with hungry travelers and adventurous locals in search of the next bewildering bite. It’s no wonder, then, that opening up your very own restaurant is a lucrative prospect with a viable chance of long-term success.
However, this opportune environment doesn’t mean that success will come easy. Battling the competition and securing adequate finances for this grand undertaking is hefty challenge few entrepreneurs manage to overcome. With that in mind, let’s take a look at five effective money-saving tips every aspiring restaurant owner should implement into the planning phase.
1. Negotiate the Lease Price and Conditions
When you’re looking for a new place, numerous crucial considerations will come into play that will shape your final decision, of which the location vs the cost of the space will play a vital role. Yes, finding a corner spot smack in the middle of the busiest tourist district in town might be the best step towards a solvent future, but chances are that such a space is way above your ideal price range.
The key lies in careful scouting and relentless negotiating. Go ahead and book a meeting with the owner to discuss your cooperation. See what kind of perks come with the place, discuss the lease terms, and don’t forget to emphasize the long-term financial benefits for the property owner. With a bit of smart financial forecasting, you will be able to convince the owner to lease the space at a sizable discount in expectation of greater monetary rewards down the line.
2. Find a Lender or an Investor
The truth of the modern entrepreneurial era is that you will seldom find an aspiring entrepreneur who has the required capital on standby, ready to be taken out and invested in launching a brand-new business. Obtaining a loan is one of the viable options any entrepreneur has on their disposal, and you shouldn’t shy away from getting in bed with a reputable lender.
On the other hand, you could pitch your restaurant idea to local investors in hopes of obtaining the capital. Although finding investors who will put their money on the line for you might be a difficult task, there are people who have had extraordinary success landing affluent investors and kick-starting their business without a hitch. So, instead of spending years trying to come up with the capital yourself, explore these two options in order to get the show on the road as soon as possible.
3. Don’t Build, Renovate
One of the worst things you can do is to invest in building your restaurant from the ground up. Remember, no matter the condition of the space, chances are that renovating it will cost you less than having to pour money into breaking everything down, and then building it back up. Now, the key here is getting the biggest bang for your buck with your contractor and architecture firm.
When designing the new interior, you’ll need to consult an innovative architecture firm such as Superdraft that will not only ensure the space is up to code, but also weave your brand’s identity into the setting as well in order to help your restaurant’s image stand out from the crowd. Keep in mind that branding is a crucial part of the success formula so make sure you involve contemporary designers into the entire process.
4. Make a Detailed Plan for the Kitchen
The kitchen is where the magic happens. This is the heart and soul of your business, and it requires two key components in order to run smoothly: professional equipment, and amazing staff. Equipping the kitchen with the latest appliances and cooking tools, acquiring reputable culinary talents, and obtaining the right type of insurance for every scenario is an expensive project, to say the least.
Firstly, always ask appliance suppliers if they are willing to cut a deal. Better yet, cut out the middleman and head straight to the manufacturer. Commit to buying in bulk from a single company and you’re more likely to get a sizable discount. As far as staff goes, it will all boil down to smart budgeting. Consider how many main staff members you need to keep the kitchen running, and then determine the optimal number of support staff for the dining area. Hire the essential staff, and don’t bring any new people in until you’re ready to expand your business.
5. Plan and Optimize Inventory
Relationships are everything in the business world. When you commit to a supplier and establish a trustworthy bond with them, you’re more likely to get a better long-term deal. So naturally, another crucial pre-launch step is to research the suppliers in your area and schedule some meetings. See who is willing to get on board and negotiate terms with you right now for a better tomorrow. If they’re thinking long-term like you are, then you’ll have no problem making a mutually-beneficial deal on the spot.
There is no denying that launching a restaurant is a costly project, but that doesn’t mean that there aren’t ways to minimize the investment and kick-start your business on a budget. Stick to these principal considerations in order to pave the road to a bright future in the restaurant industry.
Editor’s Note: This article is part of the startup tools blog series Start Your Business brought to you by the marketing team at UniTel Voice, the virtual phone system priced and designed for startups and small business owners, and Cooper Klein, author and contributor at Futurepreneur.