A guide to setting up a restaurant includes restaurant location, design, and procurement. Opening a restaurant is exciting and, if done right, a rewarding experience. But it can also be daunting for those unfamiliar with the process. In this article, we’ll provide one stage of a comprehensive guide to setting up a restaurant, from location selection and lease negotiations to kitchen design and vendor contracts. We’ll walk you through each step so that you have all the information you need to get your restaurant up and running!
Introduction to Restaurant Setup
When it comes to setting up a restaurant, there are many factors to consider. The first thing to recognize is that the old adage “build it and they will come” is mostly a myth. Developing consistent and recurring patronage relies on well-thought-out strategies. Arguably the most important step is choosing the right location that coordinates with the concept you want to present so that you build a cohesive brand.
Not only should the space be large enough to accommodate your needs, but it should also be in a prime spot for the type of demographic you want to attract, positioned for foot traffic and easy accessibility. Once you’ve found the perfect location, it’s time to start negotiating your lease. This can be a tricky process, so it’s important to have a clear understanding of your rights and what you’re willing to compromise on. A restaurant consultant can provide decades of insight having gone through the process many times.
Conducting Location Comparisons
Assuming you’ve already done your homework and have a general idea of the type of restaurant you want to open, it’s time to start looking at specific locations. Here are a few tips for conducting location comparisons for you and your consultant to do a feasibility assessment:
1. First and foremost, assess whether the space has adequate water and electrical capability to support a fully operating restaurant. You need to upgrade the service upgrade meters which can be very expensive and very time-consuming. So if this is the case, if it does not meet the specs you require. discuss with the landlord the improvements required and factor it into the lease negotiations.
2. Consider the demographics of the area. What is the population? What is the average income? What is the age range? This information will give you a good idea of whether or not the area is a good fit for your restaurant concept.
3. Take a look at the competition. Who are your potential customers most likely to visit if they’re in the mood for your type of food? If there are already several restaurants competing for business in the area, you’ll need to make sure your concept is unique enough to attract customers.
4. Evaluate the foot traffic in the area. Unless you intend to launch a “secret” concept, such as a speakeasy, you have to determine if the location is near any major businesses or attractions that will bring people into the area. If not, you’ll need to make sure your marketing efforts are strong enough to bring people in from other areas. Is there public transit nearby; is there available parking?
5. Consider Health Code requirements. There Health Dept also has requirements that you need to make sure the space can meet. For example. making sure there’s enough hot water, grease traps in hand wash sinks, and more Meeting the requirements of the health department is imperative.
6. Ask yourself if you can see yourself running a successful business in this location long-term. It’s important to choose a location that you’re comfortable with and that has good potential for growth.
The best restaurant locations are those that are highly visible and easily accessible to potential customers. But just as important is that it is the right fit for your vision.
A Guide to Setting Up a Restaurant
Negotiating the Lease Agreement
Lease negotiations are another important consideration when choosing a location for a new restaurant. It’s important to work with an experienced commercial leasing agent who can help negotiate the best possible terms for the lease. Make sure the landlord has a personality you feel comfortable with; someone you feel is looking for a “mutually beneficial” relationship. There are many sharks swimming around out there.
The terms of the lease will determine how much rent you pay, how long you have to stay, and what kind of repairs or renovations you are responsible for. It is important to have a lawyer or experienced commercial leasing agent help you negotiate the lease agreement to ensure that your rights and interests are protected.
When negotiating the lease agreement, there are a few key points to keep in mind:
1. Rent: The amount of rent you pay will be one of the biggest factors in determining your profitability. Make sure to negotiate a fair rent price that you can afford without breaking the bank. Additionally, you need to factor in the prices you’ll need to charge, and whether the neighborhood can support that price range.
2. Length of lease: The length of the lease should be determined based on your business plan. If you are planning on expanding or moving within a few years, then a shorter lease may make sense. However, if you are looking to stay put for the long haul, then a longer lease may give you more stability and peace of mind. If you’re looking to raise investment capital, make sure you’ve contracted an agency that can develop the investment materials you need to close on that funding.
3. Repairs and renovations: Who is responsible for repairing and/or renovating the space? This is an important point to clarify in the lease agreement so that there are no surprises down the road.
4. Utilities: Who will be responsible for paying for utilities such as electricity, gas, water, etc.? Again, this is something that should be clearly stated in the lease agreement to avoid any misunderstandings later on.
5. Insurance: Depending on the state, city, and/or country, this can vary from location to location.
Design and Buildout of the Restaurant
Setting up a restaurant begins after the lease is signed and you’ve officially secured your space. Now it’s time to start thinking about the design and buildout of the restaurant. Design and build-out are critical elements in the success of any restaurant, and there are a number of things to keep in mind during this process. This is a crucial step in the process, as the layout will directly impact the efficiency of your operations. Work with a professional architect and designer to create a floor plan that makes the best use of your available space.
Kitchen Design (back-of-house)
This is where all the magic happens, so you want to make sure it’s well-thought-out and efficient. Here are a few things to keep in mind when designing your kitchen:
1. Workflow: You want to make sure your kitchen is designed in a way that allows for a smooth workflow. This means having enough counter space for prep work, adequate storage for all your ingredients and supplies, and easy access to all the major appliances. Moreover, the kitchen has to interface with the servers, so you need clear paths for them.
2. Safety: Another important consideration is safety. You want to make sure your kitchen is designed in a way that minimizes potential hazards. This includes things like placing sharp knives away from areas where people are likely to bump into them, using slip-resistant flooring, and having proper ventilation to avoid dangerous fumes build-up.
3. Functionality: Last but not least, you want to make sure your kitchen is functional. This means having everything you need within easy reach and making sure there’s enough space for everyone to move around easily without bumping into each other or tripping over things.
The layout of the kitchen should be designed with efficiency in mind, and all of the correct and necessary equipment should be included in the design.
And finally, don’t forget about the small details! From choosing the right tableware to stocking up on supplies, every detail matters when it comes to opening a successful restaurant.
Dining Area (front-of-house)
As mentioned previously, EVERYTHING you do should tie back into the brand personality of the venue you wish to create in line with your vision. From the design of tables and chairs to the spacing. the color of the walls, artwork, plants, and lighting. The dining area is where your customers will spend their time, so you need to craft the type of experience you want them to have there. Will you have a sound system, live entertainment, big-screen TVs, and a bar?
These are just a few of the design consideration that needs to be thought out and decided upon.
Fire Code Compliance for Restaurants
Compliance isn’t as sexy and exciting as visual design. But when it comes to setting up a restaurant, one of the most important things to keep in mind is fire code compliance. Fire code is not the only compliance you’d be subjected to as a restaurateur, but contrary to Health Code and Rating, fire code planning is an aspect of architecture and design.
Restaurants are high-risk businesses when it comes to fires, so it’s essential that you take all the necessary precautions to ensure your restaurant is up to code. Some of the key fire code compliance issues you need to be aware of include:
1. Kitchen design and layout: Your kitchen needs to be designed in a way that minimizes the risk of fire. This includes having adequate ventilation and proper storage for flammable materials.
2. Fire extinguishers: All restaurants must have properly functioning fire extinguishers on-site at all times.
3. Emergency exits: Your restaurant must have clearly marked emergency exits in case of a fire.
4. Smoke detectors: Smoke detectors must be installed in all areas of the restaurant, including the kitchen.
5 . Sprinkler systems: A properly installed and maintained sprinkler system is one of the best ways to protect your restaurant from fires.
Selecting Vendors and Suppliers
There are a few things to consider when selecting vendors and suppliers for your restaurant. As a product service business, your restaurant will need to rely on reliable suppliers. Food and drink are obvious ones, and the needs vary based on the cuisine you’re serving. Some products have a shelf life, whereas fresh fish and produce may not.
If you stock a bar, bottles of liquor, juice. and mixers you can stock. but if you have beer on tap, the reliability of getting the tap refilled can be time sensitive. But everything from tableware, clothing, cookware, and trash pickup relies on vendors and suppliers. And don’t forget your other vendors, such as POS and delivery vendors, or website, technology, and marketing services.
Everything is a negotiation that takes into account frequency and quality. and reliability and matching that up with your budget. Leverage, leverage, leverage! if you’ve chosen a brand soft drink or several brands of beer on tap, your consultant just might be able to play one off the other so that if they want the contract they’ll provide “X” number of free cases of product for your Grand Opening, for example.
So again, everything is not about the lowest prices. You don’t want to skimp on quality, so it’s important to find vendors and suppliers that can provide you with high-quality products, fair value, and consistent reliability that you can build your business around.
Conclusion
Setting up a restaurant is no small task, and this guide is just one of many stages in the process of setting up and launching a restaurant. We know it can be overwhelming, but it doesn’t have to be. With the right guidance and information, A2Z Restaurant Consulting can ensure that your restaurant is set up properly from the start.
We hope this guide has provided you with valuable summary insights into location selection, lease negotiations, and kitchen design. Use these tips as a jumping-off point for setting up your restaurant so that you can turn your dream of opening a successful establishment into reality! But also be sure to explore the other stages of restaurant setup on our services page, and the types of restaurants we work with or ala carte services such as turnaround and profit improvements.
Note that a high percentage of businesses in general fail in their first year. And while some can be attributed to flawed concepts or poor management, many are due to improperly missing critical foundation setup. According to the National Restaurant Restaurant Association, restaurant failures are approx 30%, though some list it higher.
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