Foodie entrepreneurs often dream of starting a restaurant and turning their passion for cuisine into profit. Of course, you know you’ll need to choose a decent space, create an appealing menu for your target customers, hire the right staff and promote your new restaurant before opening your doors to the community. However, there are many steps to take before diving in.
Starting a restaurant will give you a full plate of responsibilities, so before you open an eatery, you’ll want to ensure you’re prepared for every step. Industry veterans shared their tips for navigating the business and launching a successful restaurant.
1. Do your homework.
In any industry, doing your due diligence before starting up is critical for success. This is especially true for the restaurant business, where simply knowing good food isn’t enough.
Joe Erickson, vice president of RestaurantOwner.com, said thousands of independent restaurants fail every year because owners are not prepared or aware of what needs to be done.
“Thoroughly research the financial metrics of a profitable restaurant, the systems successful restaurant owners use to promote consistency and predictability, and the type of culture that will attract the best workers,” Erickson said. “[Potential owners] need to understand the challenges of restaurant ownership before spending their life’s savings.”
Even if you have worked in a restaurant, there are still many legal, managerial and marketing lessons to learn. One area that many would-be restaurateurs overlook is local licensing and health regulations. Michele Stumpe, a Georgia-based attorney specializing in alcohol licensing and hospitality litigation, stressed the importance of knowing the legal policies in your restaurant’s location, especially since state and even county laws can vary. Aspiring restaurateurs planning a launch should factor in the time permitting and inspection processes will take, Stumpe advised.
2. Get as much industry experience as you can.
Getting your bearings in the restaurant industry as a first-timer can be difficult. If you don’t have any previous experience in the business yourself, it’s important to partner with or hire someone who does.
When Costanzo Astarita started his Atlanta restaurant Baraonda in December 2000, he and his partner had worked on both the food preparation and management sides of the industry, but he didn’t know much about commercial leases.
“I wish I had understood how to negotiate them when I started,” he said. “I think that any new restaurateur who is unfamiliar with commercial leases should hire a lawyer who specializes in that field.”
Tony Doyle, owner of HK Hospitality Group, has worked in restaurants since age 12 and opened several successful restaurants, but he still had a lot to learn when he opened his first establishment.
“There were a lot of things I’d never dealt with before – employees, payroll, taxes, bank account management, etc.,” Doyle said. “You need to get a general knowledge of the working of the business before you start. There are a lot of issues that people don’t see.”
3. Choose the right location.
Without a good location, your restaurant is doomed to fail, no matter how great it is otherwise. In the 30 years she’s been in business, Paola Bottero moved her Manhattan eatery three times before settling on her current location. Marco Pipolo, owner of NYC’s Marcony Ristorante, has learned valuable lessons from each of the five restaurants he’s owned, but one of the most important is that location can make or break your business.
Even with a mobile eatery, location can still present an issue. Daniel Shemtob, co-founder and executive chef at Los Angeles-based TLT Food, recalled a harrowing first day working on The Lime Truck.
“[My co-founder and I] were in the middle of nowhere – we didn’t have propane to cook, and the truck wouldn’t start,” said Shemtob, who recalled having to hotwire the truck and wait for someone to come help them.
“Then there are other factors, like traffic,” he added.
4. Be adaptable.
While being consistent in food quality and service is important for success, the restaurant business is far from static.
“I have found over the years that you constantly need to be updating, renovating and evolving with the ever-changing taste of the public to be successful,” Pipolo said.
Shemtob agreed, noting that his menu is constantly changing to allow for newer, more innovative dishes. When you come up with your concept and menu, it should be flexible enough to adapt when your customers ask for something new.
5. Put your customer first.
Everyone knows that a successful restaurant needs to serve delicious food, but there are so many other factors that contribute to the success of your venture – and most of it boils down to happy, loyal customers. If there’s one thing Bottero wishes she knew when she started out, it’s that creating a loyal following is difficult and takes time, even if your menu is top-notch.
“Customers make the place,” she told Business News Daily. “You have to earn their trust by making sure they’re taken care of and providing the best service possible. In today’s market, you also can’t succeed without social media. Good food is important, but so is good technology.”
Additional reporting by Nicole Fallon. Some source interviews were conducted for a previous version of this article.