How To Start a Restaurant in the USA [With Examples]

How To Start a Restaurant in the USA

Owning a restaurant offers many opportunities to grow and develop your creativity. The industry as a whole is still growing and expanding, but nonetheless highly competitive and dynamic.

You need to start by analyzing the costs associated with starting a cafe business in the United States of America.

How much does it cost to open a cafe in the USA?

The average restaurant startup cost is $275,000. In general, the cost can fluctuate anywhere from $95,000 and $2 million.

Regardless of where you intend to start your restaurant business in the United States, these are the main expenses that you are expected to incur when starting a business:

  • The total business registration fee – $750;
  • Legal costs for obtaining licenses and permits, as well as accounting services – $1,300;
  • Marketing advertising costs for the grand opening of your restaurant – $3,500, printing flyers – $3,580;
  • The cost of hiring a consultant – $2,500;
  • Insurance (general liability, workers’ compensation and property damage) coverage for a total premium – $2,400;
  • A 12-month lease payment of $1.76 per square foot – $52,800;
  • Cost of reconstruction of the store – $10,000;
  • Other start-up expenses, including office supplies ($500) and telephone and utility bills ($2,500);
  • Operating expenses for the first 3 months (salaries of employees, payment of bills, etc.) – $60,000;
  • Cost of the initial stock – $16,027;
  • Retail items (napkins, coffee bags, cleaning, etc.) – $1,840;
  • Foodservice equipment (microwave oven, toasters, dishwasher, refrigerator, blender, etc.) – $5,000
  • Cost of countertop hardware (countertops, sinks, ice machines, etc.) – $9,500;
  • Cost of equipment for the service area (plates), glasses, cutlery) – $3,000;
  • Cost of store equipment (cash register, security, ventilation, signs) – $13,750;
  • Office equipment and furniture – $3600;
  • Expenses for the purchase of furniture and gadgets (computers, printers, telephones, televisions, audio systems, tables and chairs, etc.) – $4,000;
  • Website launch – $600;
  • Additional costs (business cards, signs, advertisements and promotions, etc.) – $5,000.

If you saved a lot of money but still need a small amount to cover emergency expenses related to opening the business, you can use payday loans Oregon city. These are short-term, small-dollar loans that are designed for people who need cash urgently. Such loans can be used for whatever purpose. They are easy to access as they have relaxed borrower requirements and do not check your credit. A payday loan can be considered an easy way out if you are sure you will be able to repay your debt in a timely manner.

Concept, location, name

The first step in opening a new restaurant is deciding what kind of restaurant it will be: high-end gourmet cuisine, casual 1950s-style diner, specialty
cuisine (e.g. Italian, French, Indian). Perhaps a microbrewery or a pub.

The location is of great importance. Before signing your lease, make sure the restaurant is in a busy area with lots of pedestrians, enough parking spaces, pay attention to how many other restaurants have opened and closed in the area.

The most enjoyable part of opening a new restaurant is choosing a name that means something to you. It can be a last name, a pun, another meaningful twist of a phrase, or it can reflect a topic or place of your choice.

Obtaining licenses and permits

As soon as the issue of funding is resolved, start filling out the documents for obtaining licenses and permits.

In addition to registering your business and obtaining a tax identification number, you will need local, state, and federal licenses and permits to operate your business.

General licenses and permissions for restaurants, regardless of state, include liquor licenses, signage permits, separate open area permits, and workers’ compensation.

And remember that many licenses and permits take weeks, even months, to obtain.

A general list of documents for a restaurant (for example, Oregon):

  1. Obtain a Business License (business license) from the Oregon Division of Financial Regulation;
  2. Draw up an overview menu. Also, you must submit a plan for the purchase, transportation and storage of products;
  3. Obtain a Sales Tax Number;
  4. Obtain a license for alcohol. If you become the owner of an existing restaurant, then you must complete the transfer of the alcohol license;
  5. Obtain an Employer Identification Number (EIN);
  6. Pass the inspection. All restaurants must pass a safety and sanitation check before opening: Fire Department’s Permit, Food Handler’s Permit; Board of Health Certificate; Occupancy Permit (permission for the number of visitors);
  7. Music License (Secure Relevant Entertainment or Broadcast Licenses) – if you have music recordings, television and radio programs that will be played / shown in your restaurant;
  8. Food hospitality business licenses and permits – licenses and permits for business services in the food sector;
  9. Seating license or not-seating license;
  10. Dumpster Permit – permission for garbage collection;
  11. Valet Parking Permit – permission for parking vehicles;
  12. Live Entertainment Permit – permission to dance show.

Business insurance

This may not be the most exciting thing to think about when you are planning to open a new restaurant, but it is vital – you will need insurance.

Insurance can help protect you and your business from a myriad of problems, from equipment breakdowns to liability lawsuits.

The main insurances include:

  1. Property Insurance;
  2. General Liability Insurance.

Restaurant design

Restaurant design should be balanced between aesthetic appearance, capacity and practicality.

Choosing the right color for your restaurant will help build a strong brand and create a welcoming atmosphere for your customers.

Menu, equipment and staff

A well-written restaurant menu should be descriptive, easy to read and have clear, uncluttered layout.

Once you’ve designed your restaurant, you can start buying commercial kitchen equipment and necessary furniture.

At the same time, start recruiting.

Kitchen staff, waiters and bartenders are an integral part of the restaurant business.

Advertising and promotion

Mass media can be used as advertising media information (magazines, television), as well as special printed (booklets, leaflets) and souvenir (key rings, ballpoint pens, etc.) products.

Advertising through social networks and the Internet gives very good results.

The forms of outdoor advertising include illuminated advertising and outdoor display.

To promote a restaurant, you can use:

  • Coupons and discount cards. The easiest type of promotion;
  • Loyalty program. Providing regular customers with discounts or free meals for a large number of transactions;
  • Repeated promotions. Repeated promotions encourage customers to either return to the restaurant within a short period of time or buy certain items from the menu;
  • Happy hours. Happy hour promotions should be held not only in stores, but also in bars.

Buying a restaurant or restaurant franchise

Opening a new restaurant from scratch, like any other business, takes a lot of money and effort.

Sometimes it is much easier to buy a working restaurant or a franchise of an already well-known brand. Pros of buying an existing restaurant:

  • availability of the necessary equipment and premises;
  • personnel who know their business;
  • customer base and existing supply channels;
  • formed reputation.

Pros of buying a franchise:

  • selling under a brand that is well known to consumers;
  • the franchisor has already invested money in the promotion of the product / service, you can work for profit from the first day;
  • continuous support from the franchisor in the form of courses and consultations.

Regardless of whether you decide to buy a ready-made restaurant or purchase a franchise, you need to carefully study all the pros and cons of such a step, get maximum information from business partners, other franchisees, study financial documents, give a market assessment of the business and calculate potential risks. Good luck!