Restaurant Start Up Mistakes

Starting a restaurant isn’t a cakewalk. A lot of planning needs to be involved if you want to start that dream restaurant of yours and have an overflowing cash register in it. The restaurant industry in India is a highly competitive one, and you must take care if you want to have a successful restaurant startup. 

However even before you start implementing your ideas, it is necessary for you to know about the most common restaurant startup mistakes the aspiring restaurateurs make that might lead your dream of carving a  space in the volatile restaurant industry to doom.

List of Mistakes that a Restaurant Should Avoid:

Follow the video to understand the most common restaurant StartUp Mistakes

• Not Having a Stellar Business Plan

When you are planning your restaurant startup, having a stellar business plan in place is fundamentally essential. One can have elaborate ideas, but you need to check if your plans are feasible. Here comes the need of a business plan. A business plan, in general, is an outline of a sketch of your business and how you are planning to carry on with the operations of your restaurant. This plan should be a go-to guide, whenever you find a sticky situation in your restaurant business.

• Not Giving Much Importance to Location

The location must never be compromised. No matter what the reason is, high rentals, high competition, whatever it is, nothing should compel you to choose a location that is secondary in your list.

Before finalizing any location must know your targeted clientele is and where you would find them. For example, if you are opening a food truck in a high-end residential area, then that might be your worst decision. On the contrary, you should try and analyze where would you get your targeted audience for your food truck; you would get them at college or university area, shopping streets, which will ensure high footfall to your food truck.

You may now think whether it is a viable option for you to open in a university area where there will be multiple other food trucks, and hence the competition will automatically be high. Our recommendation to you will be, select a high footfall area, regardless of the high competition. If you are good at what you do, customers will visit you in spite of the high competition.

• Not Having a Clear Concept

Having a stellar and defined concept is one of the fundamental prerequisites for running a successful restaurant startup. You need to have a predefined vision of how you want your restaurant to look like. From the space layout to the type of furniture, to the facade and the decor, you need to decide everything beforehand. Many a time it is seen, that the things you have pictured can’t be fulfilled due to space configurations or other unexpected reasons. Hence, we recommend you to sit with hired professionals, be it interior designers, architects, engineers, and general contractors. Share your ideas with them and get feedback on any foreseen problems. Work together to create alternatives plans for your concept. This may be better than the original plan that you had envisioned.

• No Proper Financial Planning

Underestimating the amount of money you would require to start a restaurant is one of the biggest mistakes that you can do. You must always come on the field with a bank balance which is good enough for you to implement all your ideas. Construction delays or changes demanded by building inspectors are the most common problem that restaurateur faces. To cover such unplanned and unexpected challenges, a certain amount of money should be set aside for working capital which should cover up to one year of electricity, rent, employee salaries and purchasing the raw materials. Besides, contingency money should also be set aside for any other unexpected problems that may arise. We advise you to keep at least 10\\\%-15\\\% of the total investment for such expenses.

• The Belief That the Restaurant Will Start Earning Profit Right Away 

Most of the first time restaurateurs have these strong false beliefs that the restaurant will start generating profit from Day 1 and end up exhausting all their investments in the opening of the restaurant and keep no budget aside that will come handy once the restaurant is in operation. This is by far the biggest blunder that a restaurateur can commit and has the potential to bankrupt the restaurant startup. Hence, it is imperative for all the aspiring restaurateurs to understand the importance to keep a standing capital. It is virtually impossible for any restaurant to start acquiring profits from the very first day. Hence, a standing capital will come handy to carry on with the fixed expenses, such as, rent, buying of raw materials, paying electricity and staff salaries and other miscellaneous and sudden expenditures.

• Not Having a Proper Restaurant Training Plan

You must always remember that you are what your restaurant staff is. Since it is your restaurant staff who are on the floor and are in direct contact with your customers, it becomes all the more important for them to be trained enough that will help them to upsell whenever necessary and to exhibit the culture and the aura of the restaurant in the most explicit way possible.

These are some of the most common mistakes with restaurants, but there are plenty of other horror stories about why restaurants couldn’t open and/or why they lost their life savings trying to fulfill their dreams in the process. 

Once all the above pointers are taken care of, it is also important to obtain a Food License for the restaurant. Keep in mind that although it is tedious, a lot of planning and research, and investing time getting to know the locals, it will help you in the long run. Avoiding these mistakes will help you be one step closer to a flood of happy customers and positive restaurant reviews.