Opening a restaurant can be a rewarding but complex undertaking. It is a responsibility with many different pieces of a puzzle that the new owner must skillfully put together. For many, it is all about learning an entire new business from inside out, and doing so in a relatively short period of time. Regardless of your prior job experience or education opening a restaurant is a huge gamble for anyone, anywhere in the world.
Location is key to creating the volume needed to run a successful restaurant. You would be well advised not to get in over your head with a lease that will bury your chances for success from the get-go. On the other hand, do not choose an out of the way location simply because the rent is more affordable. Remember the old adage about getting what you pay for. Selecting a market and location for your restaurant will depend to a large extent on the type of restaurant and the menu you will be offering.
Unless you are taking over an existing location, the build out costs for leasehold improvements, equipment, seating, flooring, lighting and related capital outlays can easily exceed $150,000. These are what some in the business call sunk costs, meaning they are expenditures that take years to recover assuming your business is able to survive that long. Either way these are upfront costs you will incur, and if you are fortunate enough you will be able to amortize these expenses over a period of many profitable years in the future.
In the initial 6-12 months or longer, be prepared to spend long hours and weekends away from your friends and family. If you are fortunate enough to make it, it will be due to a combination of hard work and dumb luck. If, on the other hand, your efforts prove futile, be prepared for the inevitable, specifically, you ending up as another statistic in the food industry, without friends, family or savings to fall back on.
Hiring, training and managing restaurant employees are probably the most difficult tasks that the new restaurant owner must face. If you are an easy going individual, your employees will take advantage and walk all over you. If you are overly strict, they will leave and go somewhere else. The restaurant business is one where your employees, from your cooks to your busboys can either make or break your business. In many cities and even smaller towns, newspaper columnists write articles about the local eating establishments. A great review will usually bring in new business for a week or so at the most, whereas a bad review could ruin your business entirely. An unfavorable report from your local health department could also be devastating.
Managing a restaurant staff is a difficult task. It can be one headache after another. Employers find that many restaurant employees are unreliable and uncooperative. The restaurant business is plagued with staff turnovers. To add insult to injury your good employees are often wooed away by your competitors.
Keeping your doors open and your seats filled with patrons can be an ongoing source of anxiety. There is a lot of truth in the statement, Opening a restaurant is the easy part, the real challenge is making money at it. Dealing with day to day problems is another aggravating exercise. Equipment always breaks down, usually in the middle of rush hour. Customers do complain, even in the finer restaurants. There is always something that will crop up to put a glitch in your day. Thats all part of the business. If you survive the initial years, in time you will learn how to run the business and cope with all the problems that arise. And in the end, if you are one of the fortunate survivors, you will recoup your investment and begin to reap the rewards.
Opening a restaurant in the best of times is difficult. A weak economy certainly doesnt help. Before you dive in head first, do your homework and weigh all your options. One journalist jokingly commented that, If your restaurant is failing at least you dont have to worry about competition. On the other hand, if you are successful, that too may be short-lived as competitors move into your area, to capitalize on your new found wealth, with bigger and fancier restaurants to steal your customers away.
