Starting a restaurant business

[kimmiz]

Hola!

if you guys recognize me, I'm Kimmiz from mexico
and I love to cook
been thinking about opening up a restaurant
but currently still at the dreaming stage
absolutely a beginner, with no idea at all,
I only know I can cook well, and I love to cook and I want to open a restaurant so I can do what I like to do and make a living out of it

anyone experienced in opening a restaurant?
thanks for your help

Bi!

[agentsmith]

I wouldn't say I'm experienced, but I do know a bit about the money part of opening up a restaurant.

Note on financing
You can consider whether you are going to keep financial control or not. If you do, you would take on the obligation of a monthly debt payment.
Or, you could opt for investors who share in your profits, if you have any, and your losses if you don't.

The pros n cons are, it's good to keep in control but it takes a lot of money and it's not easy to loan that amount from banks. As for investors, when you're really making money, it's difficult to cut them out and that would be a pain since you're doing everything and they're not, yet you share profits.

Top reasons restaurants fail
Money. Money and more money. On a common rate, veteran restaurant owners need to add 10 to 15 percent to their operating capital above their total investment, while novices usually need 20 percent.

You see, after a month or two of business, you might find out that lunch is not as profitable as you thought, or something similar, but you're still gonna be paying out bills and salaries right. I recommend a 30 - 40% of your capital as reserve cash, just to be safe.

So far, on money, that's all I know, other aspects, perhaps some other people would know here, do your research well Kimmiz, cooking for fun and cooking for business is two different things, if you know what I mean ;)

[cool]

Actually, in any business, you'll probably spend more like 200-300% more than what you expected to spend. So, be careful and be ready to lose all your money if you do ever intend to go into business, especially the restaurant business.

I know first hand because I use to own 2 fast food restaurants and both went under.

[crazylily]

What happened to the restaurants?
couldn't sustain the first few months or business was really bad, coz if the food is good, usually restaurants make good money, profit margin in F&B industry is high isn't it?

so was it because you didn't prepare enough capital to roll?

[jokinn3]

Hi Kimmiz~
I had run my own brick & Morter business for 16 years, before a mis-diagnosed illness put me on temp. disability. Hopefully we'll be re-opening the first of next year. (Fingers crossed)
I just wanted to tell you I agree with the post about money. That is the most common reason businesses fail. The owners don't start with enough and then don't budget wisely after the money starts coming in. Its a good idea to to be sure to get enough money to pay your loan payment, your own wages, your employees wages/taxes/workmans comp/unemployment ins., your utilities, your supplies, advertising etc for at least a year, in addition to the amount you need to just get the doors open. Leave that extra amount in a savings account and don't use it unless absolutely needed. Expect business to be slow for the first few months until the community gets to know you and your employees.
You may want to consider a franchise. They can tell you up front how much you're going to need and They give alot of support and even help train employees. Usually the businesses are also well known names so people already have an idea what to expect. The draw back is that you pay a franchise fee, and have to follow their policies as to what to offer and how your store looks.
I wish you much luck in your business venture!
Jo

[janetgan]

Hi guys and girls, it's me, Janet!

starting a restaurant can be a very very bad experience if you handle it bad,
and you'll be surprised, it's not the matter about how good u are in cooking, it's about how good u can run a restaurant business.

my family and I started one before, my dad was a top class chef, not that top but hey, his food taste great!

anyway, about two years ago, he started his own restaurant and we
(the family) all helped out. it started out well, he was the head chef and we had a few staffs helping him out, business was good until after about 5 months, we're practically exhausted from it.

we were making money, but it was costing us too much time and effort just to make that little bit of money, and because none of us were from business management background, there were too many problems in the restaurant that we didn't know how to handle.

for example, if my father shares his recipe, he's afraid that the staffs would copy it and open a new rival restaurant. but if he doesn't, then he's almost 24/7 in the kitchen

there were many other issues here and there but basically, the most problematic one is still that it's taking too much effort and time, and you basically have to put all your time in it to maintain the business

so, as expected, we closed shop and gave up :(

so, kimmiz, knowing how to cook good food, that's good, but hta'ts not the only thing you need to know when you want to open a restaurant.

if you do decide to open it, all the best to you :)

[llfwjr]

Restaurants can be a very tough business. Low profit margins, lots of employee hassles, long hours.

Ask yourself what do you really want to do: run a business, or cook?

Have you considered getting into the specialty food market instead? Maybe a line of gourmet foods that you can sell to specialty stores? Are you located near a tourist area? If so, maybe something that you could sell in tourist gift shops.

[withmahi]

I thought that , i'll be owner of hotel ... its good ideaa .. keep it up...