How to open a small restaurant

You’ve had this idea for a restaurant for a while and your friends and family have given the thumbs up to your concept, so how do you make it happen?  

The first step is to write a business plan. Putting your ideas on paper will help translate your dream into a reality and, crucially, check that your concept is viable as a business.   

While a passion for providing hospitality and great food and drink is an essential ingredient in running a restaurant, it won’t be enough to put food on your table, so you will need to plan how you’ll gain the financial returns of your forthcoming hard work.

A robust plan should include details of your concept, who you expect to aim at (see The market), suggested location, how many people you will employ (see Staffing) and a rough estimate of costs involved in purchasing equipment.

The plan will also enable you to better secure funding (see Financials) to get your new restaurant business off the ground.

Before you contemplate opening a restaurant – even a small one – you’ll need to secure funds.

Start-up costs will vary, depending on the location and size of your proposed restaurant, but they typically include rent, business rates, staff wages, purchasing – or hiring – of equipment, insurance and marketing.

The lease will be one of your highest costs, but how high will be dependent on where you’d like to open and how big your proposed site will be, so you may have to be flexible, either with your start-up budget, or location.

It’s also worth noting that some suppliers may also charge up-front if you’re a new business, so be prepared to pay out large sums before you see any return. And ensure you budget enough to cover all costs for the first month or so of opening, to allow for trade to get going.

Once you have a rough idea of costs involved in opening your restaurant, you’ll know how much you’ll need to invest, or borrow, to get it off the ground.

Even if you must borrow money, the likelihood is that you’ll require some capital to secure a loan from the bank or a loan company. If you don’t have savings, or another form of equity to secure a loan, there are options such as Seed funding – a form of securities offering in which an investor invests capital in your company in exchange for an equity stake.

Crowdfunding, where entrepreneurs raise finance by asking individuals to invest small amounts of money to help finance their business, is another route and popular among independent restaurant owners, especially those who have built up a profile through a previous food business like a street food stall, or as a chef working elsewhere.

Some small restaurant owners have even managed to start their business with just a credit card loan and a hefty dose of creativity.

Whichever route you decide to take, this step is one that should be taken carefully and with advice where necessary.

You may have sounded out friends and family about the exciting restaurant concept you have, but what will others think? And is your idea already out there?

Carrying out some market research locally and on an industry level before you sign on a lease is a prudent step.

Who is the target market?

Think about who your target market will be and whether they reside, or work in the area you’re considering opening in, then check out other restaurants, bars and cafes to see how your concept will fit in.

Ask if you fill a gap in the market and if you’ll potentially get enough customers through the door before you choose your location. The neglected high-street site that seems a steal, might be worth over-looking for a small country pub in a well-heeled village if you have Michelin-starred aspirations.

Likewise, a burger bar concept requiring frequent footfall might be better located in a busy town with a young customer base, rather than tucked away in a quiet suburb.

Check out the competition

Once you’ve found a site, check out the competition in the local area and think about how your concept can stand out. Then, once you’re ready to open, don’t forget to market your restaurant to the audience you’ve identified as potential customers.

Marketing the restaurant

Today, having a website is an integral part of a business and will serve as a valuable promotional tool for your new restaurant, so it’s wise to create and launch one before you open.

Through a well-designed website, increasingly tech-savvy customers can find out essential details about your restaurant, such as opening times and contact details and get a better idea of what to expect from the food, service and décor.

To convert browsers into bookers, ensure you include a booking tool on your website. A rising number of diners are choosing to book online, so make it easy for them after impressing them with your concept. With Access Collins, restaurants get 14% more bookings online, so it’s essential to choose a system that does the hard work for you.

When your website is up-and-running and in the run-up to launch, set up social media accounts and post content on them to build excitement and gain followers (and potential customers) before you open.

When the launch date is imminent, contact your local and trade press to let them know your plans. This will help secure publicity and alert potential custom while gathering support from the industry.

It can be tempting to direct your attention into promoting the launch of your new restaurant and then moving on to operations, but marketing is for life, not just for opening. To guarantee a steadier stream of customers through the door, you’ll need to find ways to encourage new ones to come and existing ones to return.

Holding a ticketed event, such as a supper club, comedy night or pop-up cinema is one way to add interest and will help attract both loyal and new customers. And it’s not hard to do with the help of combined ticket and marketing solution Access Tonic.

Another way to boost sales is by promoting packages via your restaurant’s website that customers can buy in advance for themselves or as gifts. Access SODA is a white-labelled gift voucher platform and allows restaurants to sell packages. These can be made bespoke, are trackable and are easily redeemable by customers.

Red tape is the bane of every restaurant operator’s life, but legislation and guidelines must be adhered to if you want to operate a food and drink business.

Ensure you understand all the legal aspects involved in running a restaurant before opening the doors to help keep your staff, customers and business safe.

The Food Standards Agency regulates food safety in the UK, so is a good place to start alongside other government departments related to running a business. Any business serving food will need a food hygiene certificate to prove it understands and is abiding by food safety legislation.

Your local authority will advise on areas such as change of use (for example if the site you have chosen has previously been used for retail, not eat-in) and licensing, if you are planning on serving alcohol.

Restaurants are also responsible for managing and disposing of their waste, so when you do open, ensure you know how to do this correctly, so you don’t fall foul of the law.

To protect your business if something does go wrong and ensure you aren’t out of pocket, it’s advisable to invest in insurance. Public liability insurance, for example, will protect you in the event of legal action should one of your customers injure themselves on site, or cause any damage. 

From refrigerators to store food and hobs to cook it on, through to tables to serve it at and EPoS systems to record orders and bill customers from, it’s a fact that restaurants require more equipment to operate than the average business.

If this is your first restaurant, it’ll be beneficial to take time to research the best products and services available for independent restaurants. If you can, speak to other small restaurant owners and find out what they use and what they would (and wouldn’t) recommend.

Technology improves our lives in so many ways and unsurprisingly can also be a useful tool in restaurant operation and management. Restaurant technologies are continually developing and can help with the smooth running of many areas of the business, so hospitality software should be considered an integral part of your operations and built into your opening plan.

According to research undertaken by Access Hospitality, 30% of restaurant operators spend three to four hours a week on back office tasks and 20% spend five or six hours on admin. This time equates to almost a day a week, time many independent operators with small teams simply don’t have to spare, which is why it’s so important to get help where you can.

Investing in an easy-to-use EPoS system with enhanced capabilities is a savvy move for any restaurateur, whether they’re starting out or are more seasoned. Not only will it save time, it could also save money. Access restaurant EPoS offers a number of functions for front and back-of-house, from ordering and taking payment, to basic stock-taking and reporting.  

While technology can lighten the load from an operations standpoint, it can also aid restaurant operators and owners in other areas, such as marketing and managing staff.  

An online booking system, for example, means less customers will be calling the restaurant to reserve a table and therefore liberating staff from the phones.

Whatever the size of your workforce, using a system like our restaurant EPoS with the ability to manage rotas and scheduling, holidays and store all employee details could help take the pressure off you, or your manager.

Our mobile app makes it easy for employees to view upcoming shifts and they can communicate instantly on schedules and absence management with managers, which saves time and ensures all relevant parties are informed.

You may want to do this on your own, but the reality is that no restaurant offering table service can feasibly operate with one person, so you’ll need to employ help to realise your dream.

Work out how many members of staff you’ll need, and what expertise is required before starting the recruitment process.

Recruit wisely. Hospitality may be about good food and drink, but it’s also a people business, so its ultimate success will rely on those who represent it.

Hospitality has traditionally been a tough industry to hire for, so you should allow plenty of time to find the right people. Access’ recruitment software can help with this. Its fully integrated vacancy and candidate management service enables operators to define the workflow for each job role, such as how many interview rounds there’ll be, freeing up valuable time.

Depending on experience, you might also need to offer training to your staff before they start in the kitchen or hit the restaurant floor. As previously mentioned, the restaurant industry is heavily legislated, particularly around the safe serving of food and drink, so employees will need training in this area.

Access Learning Lite enables owners to allocate a range of relevant training courses, from health and safety to mental health, to those who might need them. Specific courses can be assigned to managers or employees to complete online through Access Workspace when they want, and owners or managers can keep track of who has completed them, so they have confidence in their staff and their business.

The style of food you plan to offer in your restaurant – and how you’ll serve it – will have been a key part of your business plan. After all, food and drink is the bread and butter of every restaurant and is the main reason customers visit.

Create a menu

Devising a menu is an area that needs to be carefully considered before opening and needs meticulous planning if you want to stay in business. The number of dishes you plan to offer, the ingredients you’ll be using and how long they’ll take to prepare will all need to be factored into the process.

Once you’ve thought about this, you’ll need to research the price and availability of the ingredients you plan to use so you can work out your costs and what you’ll charge customers. From this, you’ll be able to work out your gross profit (GP) so you can forecast the kind of revenue you’ll make.  

Setting up supply chain

Setting up a solid supply chain is essential at this point too. You don’t want to find that the ingredients in your most popular dish are no longer available after a week of trading.

One way to manage menu changes, work out GP of dishes and keep an eye on the cost of ingredients, is to invest in EPoS software with enhanced capabilities. 

Access EPoS is not only quick and easy to set-up, it also includes basic stock-taking and reporting functionality within its suite of services, which enables operators to account for deliveries and returns and keep a better eye on costs and stock levels.

Receiving reminders to re-order stock, so customers aren’t disappointed when the dish they order isn’t available is another reason to use a resource such as this.

Our restaurant EPoS can also help with pricing to optimise profitability, while the real-time reporting means you can see what dishes are performing and which aren’t, enabling you to minimise wastage. Not only does this make the business more efficient, it prevents costs spiralling out of control, something any new-time restaurant owner will appreciate help with.