Many new restaurants fail within their first year of opening  because the owners  overlook another important, albeit less exciting, portion of the business, and that is the finance and business planing part. Many fail to realize that a restaurant is after all a business, which requires careful planning. Here are a few pointers that any budding Gordon Ramsay should consider when drafting a business plan for his/her new establishment:

A restaurant’s business and financial plan is usually composed of eleven sections that cover the projected operations of a particular food service being developed.

1. Company Description – the business plan begins with an overview of the entire profile of the restaurant being developed. This section describes what business entity that will operate the particular restaurant. Necessary information such as the company’s founders, assets, type is stated in this section. Supplementary information is also stated such as the company’s goals and visions, the company’s identity, and so on. This section would also describe what kind of restaurant is being developed, as well as its location, size, general target market and other information will provide the identity of the restaurant.

2. Industry Analysis – this section provides a general overview of the restaurant industry. Careful research is needed for this section in order to provide accurate figures regarding the past trends as well as projected performance of the industry. This section gives justification as to why developing the restaurant is a worthwhile endeavor.

3. Products and Services – this section describes what the restaurant will offer. Here, the general theme of the menu will be described. This section will also provide the prospective general production scheme, stating how the food will be prepared and how other necessary measures in the production would be carried out. The manner upon which the service will be delivered will be described here as well.

4. Market Analysis – this section describes the targeted market. This will provide the profiles of the projected customers, as well as the location where they will be coming from. This section will also include a description of the observed trends in the market, such as the population growth, and other factors that might affect the restaurant’s operations.

5. The Competition – this section describes the potential competitors’ profiles. Other restaurants within the area will be described. The particular restaurants that have the same target market will then be discussed furthermore. The planned competitive strategy will then be described, stating how the planned restaurant will be different from the existing ones.

6. Marketing Plans and Sales Strategies – this section the plan of action to make the restaurant thrive. A description of how the market will be penetrated will be provided here. This section will also state the channels that will be tapped for advertising and generating awareness of the restaurant. The budget allotted for the marketing strategy will also be stated.

7. Operations – this part will give the details of the operating scheme. This section will describe the restaurant’s facilities and equipment. The hours of operation as well as the projected holidays will be stated as well. The employee training and other aspects of human resource management will be described. The systems and controls, food production, and other services will be expounded.

8. Management and Organization – this section will give the profiles of the managing arm of the restaurant as well as its ownership. The primary employees and key managers will be described here as well as its board of directors.  The compensation and incentive scheme will be explained. The management style and structure will be further expounded.

9. Long Term Development and Exit Plans – this section will provide the goals, strategies, and milestones of the restaurant. This will also predict possibilities of expansion. Risks will be evaluated.

10. Financial Data and Projections – this section will provide the current information about the company’s assets at the beginning of the restaurant’s development. It will also forecast projected figures in sales, expenses, profits and so on.

11. Appendices – this will give the actual data being described in the body of the business plan. The actual menu, financial statements, declaration of assets and other important information will be included here.

Having a restaurant doesn’t only entail work in the kitchen or out on the frontline , a large component of the work will focus on boring details like business plans , financial budgets etc.  A restaurant is primarily a business, and the business aspect of its operations should also be emphasized if you are to succeed with your new venture.

Business Plan For A Restaurant is a post from: Start-up

The first link is features an article by Tim Berry one of the leading gurus on the subject of business planning ,

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Business Planning News Stories is a post from: Start-up

• Business planning forces you to set goals , without goal setting you are doomed to fail. The business planning process ensures that the goals are achievable and realistic.




• Business planning requires that you take into account the business landscape that you operate in  , who your competitors , suppliers etc are. A thorough investigation of the regulatory framework will also enable you to get a better understanding of the business landscape.




• Requires you to focus on your strengths and weaknesses and how these interact and influence the business landscape and your long term goals.




• Requires you to focus on alternative scenarios and develop action plans to meet changing scenarios – the business landscape is dynamic and change is the only constant. Successful businesses are those that can adapt to the dynamic environment. Business planning forces the entrepreneur to think about possible changes and how to manage these changes whether they constitute a threat or a possible opportunity.




• A Business Plan enables others in the business to understand the vision and goals of the owners and management – It ensures that all players are on the same page.




• A Business Plan is required if you need to raise finance , whether it is from financial institutions like banks or venture capital finance. Even if you intend raising capital from family and friends a well thought out Business Plan makes the process easier and will also provide comfort to your investors.




• A Business Plan can be a measurement and evaluation tool , setting clear cut objectives and budgets enables you to measure and control business activities and makes it easier to rectify and divergences.




• It requires that you apply your mind and think logically and analytically about the business , this results in better decisions and forces you to think of issues that you might overlook.




• Helps you comply with certain statutory requirements like employment equity , if it applies to your business or is likely to apply to your business at some point in the future, you should incorporate it into your Business Plan.




• A well drafted Business Plan provides you with a better understanding of the viability the proposed business , if after conducting all the research and planning processes you begin to realise that it is not such a great business, you can pull the plug then and there saving yourself a great deal of money.




• A Business Plan is a dynamic tool and needs to be continually reworked as conditions change thereby forcing you to continually evaluate your business and the environment. A Business Plan should never be forgotten and filed once you have all the funding and your business is underway. The planning process is something that all successful entrepreneurs continuously do.

Many owners of SMEs mistakenly believe that their business are too small to need a Business Plan , the question they need to ask is whether their business is too small to fail. Business Planning significantly reduces the risk of failuire and all succesfull entrpreneurs are succesfull planners.

Why You Need A Business Plan? is a post from: Start-up