You’re finally ready to break out of the corporate life and start your own business.
Well, the restaurant industry is a $709.2 billion-dollar industry, who wouldn't want to start a business in this industry.
Let’s say you want to open a coffee shop. The US coffee shop industry includes about 24,000 stores with combined annual revenue of about $12 billion.
Many Americans can’t start their mornings without their morning cup of joe. Putting it lightly, we are crazy about coffee. And why not, coffee taste good, it wakes you up, and is a great way to start your day.
So, why not tap into that basic American need of coffee and make some money from it. But where to begin?
The thought of starting your own business can be very exciting! Especially one in this industry. But it's not just about getting a location and starting. There are things you need to know and do even before you start. You need to plan!
There are three business models you can do to get started opening your own business:
Get a Franchise
Buying an existing business
Or opening one up from scratch
Get a Franchise
Starting with a franchise is not a bad idea, but it can be costly.
A franchise is good because the product you are working with has been proven, business strategy, marketing strategy, and brand has already been established. So you don’t have to worry about any of that.
However, the cost of starting a franchise can range anywhere from $250,000 to a million dollars. Usually the franchise will ask you to prove that you have a liquidity capital of $250,000 and an initial investment of anywhere from $250,000 to $750,000.
Liquid capital is something that can be converted into cash quickly. For other businesses like the Coffee Bean and Tea Leaf you need to invest around $3 million to $5 million.
Buy an Existing Business
You can also buy a coffee shop that is already up and running.
What do you need to get started?
Well a little insight in the industry wouldn't hurt.
If you really want to enter this industry, whether it is a coffee shop or a deli or even a full-service restaurant the best thing to do, if you haven’t already worked in one, is work in one of those businesses for a couple weeks. This way you will know if you really want to open this type of business.
So if you know for sure that you want to start a restaurant business get informed, you need to have a detailed understanding of that business. What will you offer, how will you get started, who will you hire, etc. Then what type of restaurant will you start, a full service restaurant, a coffee shop, take out...etc. Go to business events and talk to restaurant owners and find out what they went through. Find out your local tax laws, state and sales tax and inspections, licenses you'll need, and zoning.
Start from Scratch
You can always start your business from scratch. There is nothing wrong with that. As a matter of fact there are a lot of benefits from starting a business from scratch.
You have full control of decision making including marketing, branding, etc. You don't get that with a franchise.
You can change vendors and suppliers.
You don't have to worry about proximity with another franchise.
And you can say, I built that!
These are just a few of the positives to starting a business from the ground up. And with everything there are pluses and minuses.
With either one of the options you will have to work hard and plan. Start by writing a business plan considering how you will go about proceeding to not only starting your business but how you will keep getting new customers and how you will get repeat customers.
But most importantly make sure you want to be in the business for at least ten years and that you love what you do, because if you don't love what you do no matter how prepared you are it won't be worth it. And lastly, just go for it, everything has a learning curve and restaurants are no different, sometimes you can be completely prepared and get nervous and put it off, so once you have your business plan, money and location you're ready!
And remember success isn't cheap. It takes dedication and a lot of hard work.
If you need extra help I'm here, check out my Strategy Call service.
What options have you thought about? Leave a comment or question below.