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The restaurant business is highly competitive, with more than 1 million different eateries in the United States and 60% of new restaurants failing within one year. If you’re thinking about entering the industry, being absolutely clear on how to open a restaurant will not only smooth the process for you but also provide you with insight on how to stand out and be different from all the competition.
1. Conducting market research before opening a restaurant
Before you open any kind of business, it’s important to research your potential market. You should ask these kinds of questions:
- What kind of products do my customers want?
- What products do my competitors sell?
- Is there an unserved niche I can target?
- How will I differentiate myself from similar competitors?
For example, lots of Americans like burgers, but there are burger restaurants all over the place. If you’re going to open a burger joint, you need a way to differentiate yourself from all of the other burger places near you.
On the other hand, if you’re opening a restaurant with unusual menu items, you’ll need a plan to change consumer habits and draw them to your location, such as strong advertising.
2. Choosing the right concept when opening a restaurant
There are many different types of restaurants that you can open. Explore unique restaurant ideas for inspiration. Choosing the right concept for your restaurant plays a big role in its success.
- Bistros. A bistro is a small restaurant with a focus on well-priced, simple food in a cozy setting. If you’re looking to create a relaxed atmosphere and straightforward, but quality menu items, this is the way to go.
- Fine dining restaurants. Fine dining focuses on high-end food and excellent service. You can charge high prices but need to back that up with quality, well-trained staff, and an impeccable atmosphere.
- Specialty restaurants. Specialty restaurants focus on a specific type of food or a specific cuisine. This is the type of business to open if your goal is to share your favorite cuisine with customers.
- Fast food restaurants. Fast food restaurants rely on quick service and a large volume of customers. If you’re going this route, consider buying a franchise.
- Buffets. Buffets involve large portions of food, minimal wait staff, and let customers serve themselves. These are a good choice if you want to create a casual atmosphere.
Have a plan – restaurants are a lot of work and involve spinning a lot of plates. Know what you’re going to do before you do it…
3. Choose your restaurant's name and legal structure
About the Authors
Written by: TJ Porter
I have in-depth experience in reviewing financial products such as savings accounts, credit cards, and brokerages, writing how-tos, and answering financial questions both simple and complicated.
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