The first step is to develop a business plan and secure financing. When seeking funding, understand the loss of control that comes with partnerships with investors. Chef Nicola cautions, “Partnerships, for some reason, just never work out.” Differences in vision, contradicting communication and management styles, and disparate commitment levels can all contribute to failed partnerships.
You may also want to set financial expectations. It’s wise to meet with an accountant to look at buildout costs, and outlay for products, packaging, smallwares, and salary. Having an attorney on hand will be helpful regarding the structure of your venture and how you’re incorporated (LLC, S Corp, etc.) A lot of money is spent to open a restaurant before a single dollar comes through the door. Operators should ensure they have enough cash on hand to run for 18 months before they start turning a profit. And they should anticipate emergencies—water lines breaking, chefs quitting right before opening, delays in shipments.
Identify locations with strong traffic potential. If a premium location is not viable, focus on making your concept delivery friendly. You can also wait. A restaurant can't be built overnight, so why rush into a less-than-stellar space? Get in contact with a good commercial realtor who knows what inventory is about to become available.
Once you secure your location and financing, apply for licenses and permits immediately since they take several weeks or months to approve. Common licenses and permits for restaurants, regardless of the state, include liquor licenses, sign permits, building permits and worker’s compensation.
