Congratulations! You have decided to take the plunge and start your own restaurant. For the past 20 years, we have worked closely with entrepreneurs looking to establish restaurants, cafes, food trucks, wine bars, sports, catering services, and everything in between. During this time, we have developed numerous methods to provide a comprehensive overview of your business to a potential funding source. The work that we complete is fully appropriate for securing private investment, SBA loans, conventional business loans, and revolving credit facilities.
Our Process
Market Research First
Our process is designed to showcase the full-scale launch of your business and its anticipated financial results over a five-year period. Most importantly, we take a market research first approach. Through numerous programs that we have developed, we are able to source nearly every financial and economic metric available regarding your target market. This includes an examination of the population size, population density, median household income, median home price, higher education rate, and crime rates within any US based market. Once this information is sourced, we do a deep dive to create a risk profile for your restaurant.
Although it may seem incredibly boring, we focus heavily on the ways in which your business can reduce its risk. It is no secret that restaurants and food service businesses carry a higher degree of risk than most other types of small businesses. Our emphasis throughout your restaurant business plan is to effectively communicate to a funding source how you will address and abate these issues. This ultimately leads to a much stronger business plan. As investors and/or banks are putting their money on the line when working with a restaurant entrepreneur – we ensure that any concern that they have is alleviated within the content of business plan. This approach fosters an immense degree of trust.
Financial Modeling
Once the market research is completed and analyzed, it is then time to develop the five-year financial model. In any restaurant business plans that we do, we include a profit and loss statement, cash flow analysis, balance sheet, breakeven analysis, and relevant business ratios. Although most financial institutions require only a three-year model, we include the additional two years which are primarily projected based on inflation and the natural increases in population growth.
For determining revenue, we take a two-pronged approach. First, we examine the market size and the anticipated amount of annual revenue produced by restaurants and food service businesses based on national and state-level statistics. This calculation is completed through a specialized analysis tool that takes into account national and state-based statistics while factoring in the economic staying power of your area. An analysis regarding the median household expenditures of food consumed outside of the home is conducted as part of this calculation. Second, we examine the anticipated size of your restaurant. This allows us to implement proper benchmarking as it relates to the amount of revenue that can be generated per square foot on an annualized basis.
Now that we understand the estimated total market size and demand, we begin to create the tables that estimate revenues from the first through fifth year of planned operations. For these operations, we have developed an entire suite of analytical tools that incorporate the rental expense and planned annual marketing budget. Using highly specific benchmarks, we ensure that the range of projected revenue is correct based these financial inputs. Once this is completed, we include the inputs that are related to your underlying food and beverage costs (cost of goods sold), payroll expenses, as well as general and administrative costs.
The Marketing Plan
Outside of market research and financial modeling, I consider this to be the most important section of the business plan. Beyond providing exceptional food and service, proper marketing will be the main driver of bringing patrons into your restaurant, café, or bar. When developing the marketing plan, we take a broad-based approach to discuss the multiple ways in which you will showcase your food service business. This includes a discussion regarding traditional marketing strategies (such as mailed advertisements) as well as a deep analysis regarding multiple online strategies that will ensure a substantial return on ad spend (commonly called ROAS). The scope of this discussion spans the use of search engine optimization, targeted social media marketing, use of social media influencers, public relations campaigns to drive food critic reviews, and use of take-away/delivery platforms to facilitate these types of sales. Each marketing channel is reviewed to determine which will result in this highest return on investment.
The Operations Plan
As you read this, you may have quickly determined that we seem to work back from front when developing a restaurant business plan. You are 100% correct. Once the core market research, financial modeling, and marketing plan are developed – we then start working on the heart and soul of the business plan. In the sections that cover operations, mission statement, vision statement, and competition – we thoroughly discuss the exceptional fare and service that you will offer to your patrons. This includes a discussion of the type of cuisine you will be offering, proprietary recipes, the ambiance of your location, and how you will ultimately set your restaurant, bar, or cafe apart from the competition.
Last but not least, we write the executive summary. This section, while the first chapter of the business plan, is intentionally left as the last piece of the work. Here, we provide a full overview of your business condensed into two to three pages which concurrently serves as a roadmap for the rest of the business plan. As people have very short attention spans, we like to ensure that they are able to get a full overview of exactly what you are seeking to accomplish, the amount of capital required, and the anticipated rate of return during the first five years you are in business.
The Commitment
As a fellow entrepreneur, I know how challenging it can be to start a new business. There are so many steps involved with the creation of any new enterprise from incorporation, licensing, business planning, human resources, sourcing vendors, as well all of the stress that comes along with running a successful company. My commitment to you is that my firm will provide you with an outstanding business plan that is developed seamlessly and specific for your needs.
I am more than happy to do a phone or video conference consultation at any time.