How to Create a Restaurant Business Plan

A business plan is one of the most important tools to launch a restaurant. It acts as a clear guide that outlines your vision and explains how your concept will take shape and operate once you open the doors. According to the Harvard Business Review, it’s also part of your recipe for success: Writing a formal plan makes your business 16% more likely to survive than entrepreneurs who lack any kind of proposal. Keep reading to learn about what to include in your restaurant business plan. 

What is a restaurant business plan?

A restaurant business plan is a document that shows investors, team members, and other stakeholders how you’ll turn your vision of a restaurant concept into a reality. It includes information about your company’s history, business model, market potential, goals, and funding needs. 

The business plan should guide your reader through each stage of launching and running your business. It should be comprehensive and articulate with enough detail that anyone can read it and easily understand your vision and how you’ll achieve your goals.

Why do you need a restaurant business plan?

Your business plan should act as a clear roadmap that helps you stay focused while you launch and grow your concept. Moving forward without a strategy or plan makes navigating each stage of your journey difficult—whether things are running smoothly or taking a wrong turn. 

The business plan is also essential to secure funding. Running a restaurant is expensive, and you may need capital from outside investors. Your restaurant plan shows potential investors that you’ve done research and developed a sound financial strategy. 

What to include in your restaurant business plan

Business plans may vary with each business, but they usually span about 15 to 20 pages and include a few basic elements. Here are sections to consider using in your restaurant business plan:

Executive summary

The executive summary should capture the reader’s attention and introduce your restaurant concept. You’ll briefly explain what your business does and the unique features that will make it successful. Busy investors may make their decision based on the summary alone, so make it count. Include these details: 

• Restaurant name and location
• Mission statement
• Restaurant concept (including the type of food you’ll serve) and theme
• Summary of the business model
• Key financial highlights
• Your background and relevant experience

Company description

In this section, explain the elements that define your proposed business and the vision for the customer experience. Include details like:

• Your legal business structure, such as sole proprietor, partnership, or corporation.
• Details about the physical space, such as the size of your restaurant, seating capacity, and layout
• Your vision for the customer experience, such as menu choices, interior design, service style, and hours of operation
• The restaurant’s unique selling points and how you expect to have a competitive advantage 
• Information about your company culture and staff
• Short-term and long-term objectives

Industry analysis

In this section, you’ll analyze current market conditions and how your restaurant fits into the landscape based on where the restaurant will be located. Some details to include:

• Target customer: Use various buyer personas to explain who will eat at your restaurant and what their dining habits might look like. Where do your target customers live, what are their income levels, and how often do you expect them to dine out? 
• Location analysis: If you don’t have a specific location picked out, include the general area where you plan to open the restaurant and why you chose it. Include details about projected economic growth in the area and how the location works with your intended customer profile.
• Market need: What are some of the needs your restaurant will satisfy? For instance, maybe you’re opening a coffee shop in an area that lacks desirable options for a certain demographic. Look for data to prove there’s demand for your concept. 
• Competitive analysis: Describe other restaurants near your proposed location, focusing on ones that offer a similar concept. Explain what makes your restaurant stand out and why your target customer will choose your restaurant over your competitors. Do some of this research by visiting the competitors and figuring out what you can do better. 

Sample menu

The menu is a critical piece of any restaurant owner’s business plan, especially when you’re applying for financing. 

The menu offers information beyond your cuisine style—it shows investors your proposed pricing structure, what you plan to serve your customers, and how your concept differentiates from others. You may either use a final draft or a close mock-up if it’s not ready. Keep these core menu design tenets in mind:

• Use the same logo, colors, design elements, and fonts to match your general branding.
• Work with your chef to create short but short but expressive dish descriptions so customers (and your investors) get excited about what you’re serving. 
• The menu prices should be based on a detailed cost analysis, which shows your targeted price point and helps you estimate the average check. You’ll also use your pricing research to create financial projections for starting costs.

Operations plan

• Staffing: List the staff positions you’ll need, such as servers and prep cooks, and how many people you expect to need in each role. Include the approximate pay for each position, how you plan to recruit your staff, and the hiring criteria for each role. 
• Customer service: Create a blueprint your entire staff can use for customer service values, policies, and procedures. For instance, what does your guest experience look like? How will you provide this service consistently? And how will your staff handle problems that come up, like a guest who has an issue with the food? 
• Restaurant systems: Explain how you’ll process payroll, track sales and inventory, accept various payment types, manage labor, provide takeout and delivery orders, and control cash.
• Suppliers: Where will you buy equipment, source your ingredients, and purchase recurring necessities?

Restaurant design

Your restaurant design is a major piece of how you’ll attract customers and set yourself apart from your competitors. In this section, describe the ambiance you have in mind and how it aligns with your theme and cuisine. Include mock-ups if you have them, or create a mood board to help investors understand the vibe. You can include samples of your design elements, color palette, and a general floor plan.

Marketing plan

The marketing section explains how you’ll promote your restaurant before and after opening. Identify specific tactics you’ll take, such as holding promotional events, launching social media accounts, and placing advertisements where your customers are likely to notice. Also include whether you plan to work with a marketing or public relations team or start up a customer loyalty program.

Financial analysis

Business owners usually place the financial analysis near the end of the business plan. This section should show how you plan to use capital in the first year and how you estimate your costs and projected revenue. Here are some elements to include:

• Funding needs: Explain how much money you need and the type of financing you want to use, such as a loan, line of credit, or equity investment. How will you use the money to improve or grow your business? How do you plan to pay off what you borrow?
• Projected profit and loss (P&L) statement: Estimate your costs and sales numbers based on details like your target market, price point, size, and location.
• Break-even analysis: After calculating your overhead expenses and operational costs, how much revenue will you need to bring in each month to break even? Show how you expect to generate the revenue you need, even in slower months.
• Expected cash flow: Estimate how much money will come into and out of your business during a given period of time.