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START & RUN A RESTAURANT BUSINESS
Introduction
Part 1. EVALUATING YOUR DREAM
1. Before You Start
1. The Restaurateur as Entrepreneur and Entertainer
2. The Menu
3. Trends
4. Types of Restaurants
4.1 The gourmet- or fine-dining room
4.2 The family, mid-size, casual restaurant (also known as the bistro or grill)
4.3 The quick-service or fast-food restaurant
4.4 Social and contract caterers
2. The Structure Of Your Business
1. The Sole Proprietorship
1.1 Advantages
1.2 Disadvantages
2. The Partnership
2.1 Advantages
2.2 Disadvantages
3. The Corporation
3.1 Advantages
3.2 Disadvantages
4. Franchising
5. Building Your Team
3. The Business Plan: Feasibility Study
1. The Business Plan: An overview
2. The Feasibility Study
2.1 Target area analysis
2.2 Population profile
2.3 Economic profile
2.4 Competition analysis
2.5 Industry and tourism profile
2.6 Cultural, recreational, and sporting events
2.7 The real estate marketplace
3. Pre-Opening Marketing Strategy
4. The Financial Plan
1. The Capital Budget
1.1 Hard costs
1.1a The restaurant space itself
1.1b Equipment budget cost summary
1.1c Furnishings, small wares, and opening inventory cost summaries
1.2 Soft costs
1.2a Consulting fees
1.2b Legal and accounting fees
1.2c Pre-opening labor costs
1.2d Permit fees
1.2e Pre-opening insurance
1.2f Pre-opening advertising, promotional, and printing costs
1.2g Cash floats
2. Investment Plan
3. Financial Statements
3.1 The income statement
3.1a Estimating your restaurant’s revenue
3.1b Estimating your restaurant’s expenses
3.1c Profit
3.2 The break-even analysis
3.3 The balance sheet
3.4 The cash-flow analysis
4. Resources
Part 2. START-UP
5. Start-Up Practicalities
1. Naming Your Restaurant
1.1 Your own tastes
1.2 Marketing implications
1.3 Copyright
2. Registering Your Business. 2.1 In the United States
2.2 In Canada
3. Trademarks
4. Obtaining Licenses and Permits
5. Insurance
6. Choosing Your Restaurant’s Location
1. Finding the Fit
2. Downtown versus Suburban
2.1 Suburban
2.2 Downtown/City
3. Freestanding versus Mall Location
4. Zoning
5. Leasing versus Purchasing
7. Design and Renovation
1. Building Your Dream
2. What Designers Can Do For You
3. Design
4. Décor
5. Designing without a Designer
6. A Word about Renovation
8. Equipment and Furnishings
1. Equipment
1.1 Sourcing equipment
1.2 New versus used equipment
1.3 Buy versus lease equipment
1.4 Kitchen equipment
1.5 Front-of-the-house equipment
2. Furnishings
2.1 Tables
2.2 Chairs
2.3 Other furnishings
2.4 Kitchen/bar small wares
2.5 Dinnerware (china, flatware, glassware, linen)
2.5a How much should you purchase initially?
9. Your Employees
1. Job Analysis, Job Description, and Job Specifications
2. Recruitment
3. Selection
4. Orientation and Training
5. Policy and Procedure Manuals
6. Reward and Discipline
7. Performance Appraisals
8. Pay Scales
9. Management Communications
9.1 Log books and incident and accident reports
9.2 Managers’ meetings
Part 3. MANAGING YOUR OPERATION
10. Your Menu
1. Types of Menus
2. Menu Pricing
3. Menu Design and Development
4. Developing a Wine List
4.1 Wine pricing
4.2 Designing your wine list
4.3 Resource guide
11. The Art of Service
1. Keeping Customers Satisfied
2. Service Styles
3. Front-of-the-House Considerations
4. Dealing with Difficult Customers
12. Marketing
1. Ongoing Marketing Strategies
1.1 Advertising
1.1a Print
1.1b Direct mail
1.1c Signage/billboards
1.1d Radio
1.1e Television
1.2 Sales
1.3Merchandising
1.4 Public relations
1.5 Promotions
2. Professionals, and What They Have to Offer
2.1 Sourcing the pros
3. Building Your Marketing Base
3.1 A loyal customer is free advertising
3.2 The role of service in marketing
4. Increasing Sales by Using the Five “Ps” of Marketing
4.1 Product
4.2 Place
4.3 People
4.4 Price
4.5 Promotions
5. The Restaurant Critic: Friend or Foe?
6. Web Opportunities
13. Cost Control
1. Keep Control Systems Simple
2. Standard Recipes
3. Standard Purchase Specifications
4. Supplier Selection
5. Purchasing
6. Par Stocks
7. Receiving
8. Storage
9. Perpetual Inventories
10. Issuing
11. Service Area Control
12. Cash Control
12.1 Cashing out
12.2 Daily sales reconciliation
12.3 Floats
13. Till Procedures
13.1 Pulling the till
13.2 Spotters
13.3 Skims
13.4 Counterfeit money
14. Bars and Pubs
1. Responsible Service of Alcohol
2. Handling Difficult Situations
3. Bar Service and Products
3.1 Bar service
3.2 Bar products. 3.2a Spirits
3.2b Beer
3.2c Wine
3.2d Bar food
4. Bar Equipment and Small Wares
4.1 Bar equipment
4.2 Small wares
4.3 Disposable goods
4.4 Bar condiments and juices
4.5 Garnishes
5. Glassware
6. Control Systems
6.1 Mechanical controls
7. Entertainment
8. Advertising and Promotion
8.1 Advertising
8.2 Promotional strategies
8.3 Public relations
Conclusion
Selected Bibliography
Acknowledgments
Dedication
About the Authors
Other Titles in the Start & Run Series
Notice to Readers
Self-Counsel Press thanks you for purchasing this ebook
Contents
This “how to” book is a labor of love, created by three professional restaurateurs and pub owners, and based on a combined total of more than 100 years of personal experience in designing, owning, and running dozens of restaurants and pubs as well as instructing tens of thousands of college students and adults.
The conceptualization, establishment, and operation of a restaurant is a very personal experience built around a dream whose time has come. A restaurant, bar, or pub is a small retail business with a specialized product or service offered to a very localized target market. No doubt before you decided to investigate the potential for turning your dream into a reality, you looked at a concept that brought joy into your heart and visions of happiness — and, we hope, profit — into your life.
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McDonald’s, for example, because it will be just like the last McDonald’s he or she went to. And that is precisely why very little leeway is allowed in franchises for the creative ideas of the individual franchisee. In our experience, the dream of most new restaurant entrepreneurs is to establish their own concepts to reflect their own personalities and what they think they have to offer the public. The very elements that make your restaurant unique are often at odds with the basic franchise precept: the duplication of someone else’s already-developed dream. We have found that the people who are attracted to the idea of opening their own restaurant usually find the tightly controlled climate of the franchise experience too restrictive, and often, after a few years they want to break out on their own.
If you do opt for franchising, however, there are several things you would do well to keep in mind. Carefully check out the particular franchise that interests you. Try to find answers to as many of these questions as you can:
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