Steps for Opening Your Own Restaurant With Little to No Money
The dream of starting one’s own restaurant is not an uncommon one. After all, plenty of things might make it an appealing idea. Maybe you’ve worked in a restaurant before, and while you enjoyed the atmosphere and interacting with customers, you just couldn’t help but think you would do some things differently. With creative freedom, you believe you have the vision to make something that truly stands out. Or maybe you just want to experience the freedom of being an entrepreneur. Maybe you love that the food industry brings communities together. Regardless of your reasons for wanting to get involved, it’s important to have no illusions about the amount of hard work required in the food industry. If you’re moving forward, this truly does need to be your passion project — because you won’t have time for anything else.
Passion alone, unfortunately, won’t get you through, though. Here are some key ideas for moving forward.
Consider becoming more experienced first
The cost of starting even small restaurant like a café can easily be over $50,000. That’s more than many people have on hand, and searching for loans or an investor can be an intimidating concept when there’s no guarantee the investment will pay off. That’s why it may be important to try to build your business and food management experience first.
One way you could do this is by seeing whether any local kitchen incubators are in your area. These are essentially furnished kitchens that can be rented on an hourly basis to produce goods. This can be a great way to build an initial customer base for your product as well as start to get a handle on some of the finer details of running a kitchen. For example, many who enter one of these programs underestimate the challenge of extra costs like electricity, as well as the price of product versus cost of operation. While these can be extreme challenges in an incubator, it’s better to happen here than in an owned restaurant that could bring financial ruin.
Have a business plan in mind
Once you think you can handle your own restaurant, and you’re serious about its success, you need to have a plan to demonstrate. The plan should include the type of restaurant you want to open, all qualifications that you have as the business owner, who your audience is, and a detailed budget of startup and maintenance costs.
The reason this is important is twofold. First, and most obvious, the plan gives you a mental foothold for what is going to be a daunting task. Second, there’s a good chance you won’t be able to afford the startup on your own. Going to the bank for a loan is always on option. Alternatively, you can look for an investor. Either way, you’ll be selling yourself as much as your restaurant idea, so come prepared to do both. Just be aware that a deal with any entity will always have its restrictions. An investor may provide cash for you to set up your own shop, or they may clear out a place they own to let you rent it. Don’t take a deal you don’t feel good about.
Once you’ve obtained your restaurant space, it’s naturally going to be exciting. You may be tempted to start redecorating right away, or you may want to plan some exotic menu that will blow everyone away. These ideas are almost always mistakes. Overspending is a sneaky monster, and one of the worst things you can do is burn through your capital and be left with a half-realized version of your dream. Start things slow. Establish a relationship with an affordable restaurant supply chain. Focus on high-quality, staple menu items. Decorate tastefully, but not outlandishly. Get a handle on what you can afford each month, and if business is permitting, start expanding toward your true vision.