Restaurant Business Plan Template

Restaurant-Business-Plan-Template

Over the past 20+ years, we have helped over 10,000 entrepreneurs and business owners create business plans to start and grow their restaurants. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through a restaurant business plan template step-by-step so you can create your plan today.

 

What Is a Business Plan?

A business plan provides a snapshot of your restaurant as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategy for reaching them. It also includes market research to support your plans.

 

Why You Need a Restaurant Business Plan

restaurant dinner togetherIf you’re looking to start a restaurant or grow your existing restaurant you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your restaurant in order to improve your chances of success. Your restaurant business plan is a living document that should be updated annually as your company grows and changes.

 

Sources of Funding for Restaurants

With regards to funding, the main sources of funding for a restaurant are bank loans and angel investors. With regards to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to confirm that your financials are reasonable. But they will want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business.

The second most common form of funding for a restaurant is angel investors. Angel investors are wealthy individuals who will write you a check. They will either take equity in return for their funding, or, like a bank, they will give you a loan. 

Venture capitalists will not fund a restaurant. This is because most venture capitalists are looking for millions of dollars in return, over a short time period, when they make an investment, and a restaurant generally can’t achieve such results. Private equity groups are a good source of funding for restaurant chains looking to expand further.

 

Restaurant Business Plan Template

Your business plan should include 10 sections as follows:

 

Executive Summary

restaurant dinner partyYour executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of restaurant business you are operating and the status; for example, are you a startup, do you have a restaurant that you would like to grow, or are you operating a chain of restaurants.

Next, provide an overview of each of the subsequent sections of your plan. For example, give a brief overview of the restaurant industry. Discuss the type of restaurant you are operating. Detail your direct competitors. Give an overview of your target customers. Provide a snapshot of your marketing plan. Identify the key members of your team. And offer an overview of your financial plan.

 

Company Analysis

In your company analysis, you will detail the type of restaurant you are operating.

For example, you might operate one of the following types:

  1. Fine Dining: characterized by fancy decor, a dress code and high prices
  2. Casual Dining: offers waiter/waitress service in a nice (but not overly fancy) atmosphere with moderate prices
  3. Fast Casual: characterized by quality food (close to quality of casual dining) but no waiter/waitress service in accessible atmosphere
  4. Fast Food: quick service provided at counter or via drive through. Lowest quality food and lowest prices
  5. Buffet: may or may not offer waiter/waitress service. Patrons serve themselves from buffet food selection

Within these types of restaurants there are also ethnic food specialties such as American, Italian, Japanese, Chinese, Indian, etc.

restaurant anniversaryIn addition to explaining the type of restaurant you operate, the Company Analysis section of your business plan needs to provide background on the business.

Include answers to question such as:

  • When and why did you start the business?
  • What milestones have you achieved to date? Milestones could include sales goals you’ve reached, new restaurant openings, etc.
  • Your legal structure. Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

 

Industry Analysis

In your industry analysis, you need to provide an overview of the restaurant business.

While this may seem unnecessary, it serves multiple purposes.

First, researching the restaurant industry educates you. It helps you understand the market in which you are operating. 

Secondly, market research can improve your strategy particularly if your research identifies market trends. For example, if there was a trend towards speedy restaurant services, it would be helpful to ensure your plan calls for take-out or other quick-service options.

The third reason for market research is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your restaurant business plan:

  • How big is the restaurant business (in dollars)?
  • Is the market declining or increasing?
  • Who are the key competitors in the market?
  • Who are the key suppliers in the market?
  • What trends are affecting the industry?
  • What is the industry’s growth forecast over the next 5 – 10 years?
  • What is the relevant market size? That is, how big is the potential market for your restaurant. You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

 

Customer Analysis

restaurant fancy dishThe customer analysis section of your restaurant business plan must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: business executives, college students, sports enthusiasts, soccer moms, techies, teens, baby boomers, etc.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of restaurant you operate. Clearly baby boomers would want a different atmosphere, pricing and menu options, and would respond to different marketing promotions than teens.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, include a discussion of the ages, genders, locations and income levels of the customers you seek to serve. Because most restaurants primarily serve customers living in their same city or town, such demographic information is easy to find on government websites.

Psychographic profiles explain the wants and needs of your target customers. The more you can understand and define these needs, the better you will do in attracting and retaining your customers.

 

Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other restaurants.

restaurant food tableIndirect competitors are other options that customers have to purchase from you that aren’t direct competitors. This includes restaurants, supermarkets and customers preparing dishes for themselves at home. You need to mention such competition to show you understand that not everyone frequents a restaurant each day.

With regards to direct competition, you want to detail the other restaurants with which you compete. Your most direct competitors will be restaurants located very close to your location, who are in the same type (e.g., fine dining, casual dining, etc.) and who offer the same cuisine (Japanese, Italian, etc.).

For each such competitor, provide an overview of their businesses and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as:

  • What types of customers do they serve?
  • What menu items do they offer?
  • What is their pricing (premium, low, etc.)?
  • What are they good at?
  • What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. And don’t hesitate to find out this information from customers by reviewing your competitors’ Yelp listing and other review pages.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

  • Will you provide superior food items?
  • Will you provide menu items that your competitors don’t offer?
  • Will you make it easier or faster for customers to acquire your meals?
  • Will you provide better customer service?
  • Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.

 

Marketing Plan

restaurant boothTraditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a restaurant business plan, your marketing plan should include the following:

Product: in the product section you should reiterate the type of restaurant that you documented in your Company Analysis. Then, detail the specific menu items you offer/will offer.

Price: Document the prices. Essentially in the product and price sub-sections of your marketing plan, you are presenting the menu items you offer and their prices.

Place: Place refers to the location of your restaurant. Document your location and mention how the location will impact your success. For example, is your restaurant located next to a heavily populated office building, or gym, etc. Discuss how your location might provide a steady stream of customers. Also, if you operate or plan to operate food trucks, detail the locations where the trucks will operate.

Promotions: the final part of your restaurant marketing plan is the promotions section. Here you will document how you will drive customers to your location(s). The following are some promotional methods you might consider:

  • Making your restaurant’s front store extra appealing to attract passing customers
  • Search engine marketing and optimization
  • Social media posting/advertising
  • Advertising in local papers and magazines
  • Reaching out to local bloggers and websites 
  • Flyers
  • Local radio advertising
  • Banner ads at local venues

 

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your restaurant such as serving customers, procuring supplies, keeping the restaurant clean, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to serve your 1,000th customer, or when you hope to reach $X in sales. It could also be when you expect to hire your Xth employee or launch a new location.

 

Management Team

To demonstrate your restaurant’s ability to succeed as a business, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company. 

Ideally you and/or your team members have direct experience in the restaurant business. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act like mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience operating restaurants and/or successfully running small businesses.

 

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet and cash flow statements.

Income Statement: an income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenues and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you serve 100 customers per day or 200? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets: While balance sheets include much information, to simplify them to the key items you need to know about, balance sheets show your assets and liabilities. For instance, if you spend $250,000 on building out your restaurant, that will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a bank writes you a check for $100.000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement: Your cash flow statement will help determine how much money you need to start or grow your business, and make sure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt. For example, let’s say a company approached you with a massive $100,000 catering contract, that would cost you $50,000 to fulfill. Well, in most cases, you would have to pay that $50,000 now for ingredients, supplies, equipment rentals, employee salaries, etc. But let’s say the company didn’t pay you for 180 days. During that 180 day period, you could run out of money.

In developing your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a restaurant:

  • Location build-out including design fees, construction, etc.
  • Cost of equipment like stoves, refrigerators, blenders
  • Cost of ingredients and maintaining an adequate amount of supplies
  • Payroll or salaries paid to staff
  • Business insurance
  • Taxes and permits
  • Legal expenses

 

Appendix

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your store design blueprint, location lease or initial menu design.

 

Restaurant Business Plan Template Summary

Putting together a business plan for your restaurant is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will really understand the restaurant business, your competition and your customers. You will have developed a marketing plan and will really understand what it takes to launch and grow a successful restaurant.

 

Want more tips? Here’s a related article: How to Start a Restaurant.

 

How to Finish Your Restaurant Business Plan in 1 Day!

Don’t you wish there was a faster, easier way to finish your business plan?

With Growthink’s Ultimate Restaurant Business Plan Template you can finish your plan in just 8 hours or less!

Click here to finish your business plan today.

 

OR, Let Us Develop Your Plan For You

Since 1999, Growthink’s business plan consulting team has developed business plans for thousands of companies who have gone on to achieve tremendous success.

Click here to see how our professional business plan writers can create your business plan for you.

 

Other Helpful Business Plan Articles

 

Business Plan TemplateBusiness Plan Template & Guide for Entrepreneurs
How to Write a Business PlanHow to Write a Business Plan to Secure Funding
The Perfect Business Plan Layout for a Great PlanThe Perfect Business Plan Layout for a Great Plan
How to Format Your Business PlanHow to Format Your Business Plan
5 Business Plan Cover Page Tips5 Business Plan Cover Page Tips
The Business Plan Consultant to Create Your PlanThe Business Plan Consultant to Create Your Plan
How to Create a Great Business Plan Executive SummaryHow to Create a Great Business Plan Executive Summary
The 10 Key Components of a Business PlanThe 10 Key Components of a Business Plan
20 Reasons Why You Need a Business Plan20 Reasons Why You Need a Business Plan
Business Plan Template Word DownloadBusiness Plan Template Word Download
Business Plan Template PDF DownloadBusiness Plan Template PDF Download
The Best Business Plan Software to Use NowThe Best Business Plan Software to Use Now
Business Plan Presentation Mistakes to AvoidBusiness Plan Presentation Mistakes to Avoid
The Business Plan Outline to Expertly Create Your PlanThe Business Plan Outline to Expertly Create Your Plan
The Business Plan Help CenterThe Business Plan Help Center

 

[for="inf_misc_Pleasegiveusabriefoverviewofyourbusinessandorcurrentchallenges"]
[for="inf_misc_Pleasegiveusabriefoverviewofyourbusinessandorcurrentchallenges"]