It always starts like this.
You slide into your favorite local bistro’s last open bar seat after another grueling day behind your corporate desk. After the bartender slides you a 9-ounce pour of inky Cabernet, you drink in the scene with your first few sips. The place is packed, even on this Tuesday night. Servers gracefully weave through clusters of bar patrons with trays laden with craft cocktails destined for diners’ tables. The dining room is as crowded as the bar, with more eager customers waiting in the lobby. But the busiest spot in the whole place? The register where the servers ring up checks. All. Night. Long.
The music, vibe, energy, and money in the place are as intoxicating as that Cabernet in your hand.
“I can do this. I want to do this. I want to open my own restaurant. How hard could it be?”
Anyone can open a restaurant. Rent a space, get some equipment, hire some cooks, and post a neon “open” sign you picked up from Costco in the window. Done. But to succeed in the restaurant business — to stand out in a teeming crowd of competitors, to be known for something unique in the marketplace, and to make money — you need more than passion and some second-hand equipment.
If you’re determined to turn your passion into profits by starting your first restaurant, avoid these all-too-common pitfalls:
- You Are Not Your Customer
Place your hand on a stack of leather-bound cocktail menus and repeat after me — “I am not my customer. I am NOT my customer!” Yes, this is your restaurant, your idea, your passion. But if you shape your vision into a concept that appeals to an audience of one, you won’t be in business long. Before you pick out colors or get a logo designed, decide who you’re building your concept for and study them. Are they adventurous foodies? Moms who need a quick and healthy meal solution for their family? Women who want a cozy place with a great cocktail menu so they can hang with friends after work? Why do they want to visit your restaurant, and how do you want them to feel? You must answer these questions fully to have a complete and targeted concept. This is the first step in separating your passion from the business, which is critical to success.
- Don’t Start Shopping for Real Estate
Once the idea of opening your restaurant has swallowed you up, your first urge is to run out and look for a location. Must make this thing real right away! Pump the brakes. There are plenty of landlords and brokers out there who are eager to have you take over their vacancy and sign their lease. Know this — it’s infinitely easier to develop a restaurant and find the right location than to find a location and shoehorn your concept into it. You wouldn’t go car shopping by hitting every dealership in town and buying the fanciest, shiniest vehicle that someone puts you in, would you? (If you would, I want to go car shopping with you). No, you’d decide on details like gas mileage, number of seats, all-wheel drive, and, of course, price. Hold off on looking at real estate until you know what you need and what you can spend.
- Get Your Funding in Order
Creating a new restaurant concept from scratch and opening that first location costs money. Besides developing the concept, menu, and identity, there’s equipment, construction, interior finishes, signage, licenses, and permits; you get the idea. Depending on your concept and where you set up shop, you can expect to secure funds in the mid to high six figures. Think about it — you’re building a retail and manufacturing business rolled into one. Lack of adequate start-up funding will kneecap an otherwise strong restaurant idea. Money can come from banks, family, crowdfunding, or even your own pocket. Just make sure you have enough stockpiled in advance.
- Hone in On Your Concept
Now we get to the fun stuff — creating your brand and menu concept! At this stage, passion takes over, and many people start piling on the menu ideas. I love pasta, so let’s make it fresh! My husband loves mushrooms, so let’s put them on everything! I hate seafood, so I don’t want shellfish on the menu! When you start designing a menu, let the ideas flow, but don’t fall prey to the “gotta have” disease. Some of the most successful restaurant chains — think In-and-Out or Chik-Fil-A — have less than a dozen items on the menu. Why? They focus on making a few amazingly good menu items exceptional instead of a bunch of mediocre ones. Keeping your concept and your menu focused means your restaurant will cost less to open and require less labor to operate.
- Know Your Lane
When starting a restaurant, most entrepreneurs dream of owning that elegant bistro down the street that they can waltz into any night, command the best table, and impress their friends. A grand vision indeed, if you have the funds to hire an expert (read: expensive) managers, chefs (see #6), servers, and cooks to run the place. More often than not, the new restauranteur will need to play a role in day-to-day operations to control labor costs. As you’re putting that focused concept together, think carefully about the work you’ll do. General manager? Kitchen manager? Front-of-house operations? Bookkeeper? Pick a role for yourself, write a thorough job description for that role, and educate yourself to be successful. Don’t try to do everything —that’s a sure-fire recipe for burnout. But do have a role in the operation. If you leave everything up to your employees, you might create a runaway train that will be difficult (and expensive) to stop.
- Don’t Hire a Chef
Hold on, aren’t we selling food here? Don’t we need a chef to make the food? Not necessarily. Of course, thousands of restaurants are successfully owned and operated by remarkably talented chefs. But a chef may not be the right solution when you’re looking for someone to run your restaurant kitchen. A “capital C” chef expects to make their food their way. They demand full creative control of the menu and assume they will operate the kitchen how they see fit. And since they’re the person in charge of the back of the house, they’ll likely want to be hands-off and hire a bunch of line cooks they’ve worked with to work the heavy shift. All that’s fine if their culinary vision matches your concept, but it’s highly unlikely. After taking the time (and money) to develop your brand and menu, you want a kitchen manager instead — someone who will follow your direction and make the restaurant operate to your standards and expectations.