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How To Increase Restaurant Sales With Online Ordering?

Competition in the restaurant industry can be cut-throat and with the rapidly changing trends, it can be difficult to acquire new customers or retain existing. As more customers seek out the ease of take-out–and especially delivery, third-party for delivery services provide an easy way to increase restaurant sales with online ordering.

Although these delivery services offer an opportunity to reach new customers  and increase sales, the benefits  come at a cost: giving up access to valuable customer data and losing loyal customer base to the delivery partners. 

It, therefore, becomes pertinent for restaurants to explore strategies to engage with their customers to keep the regulars coming back, attract new customers, and build their native platforms to increase online orders on their website. In this article, we will discuss some strategies to increase restaurant sales with online ordering.

How to increase restaurant sales with online ordering?

  1. Opt for A Robust Online Ordering Solution
  2. Streamline your online ordering menu
  3. Optimize your online ordering platform
  4. Make it easy to order from your website
  5. Leverage Digital channels to Promote Online Ordering
  6. Optimize Your Website For Local Search
  7. Promote your Online Ordering Platform
increase restaurant sales with online ordering

1. Opt For A Robust Online Ordering Solution

Many restaurant owners/managers opt for third party delivery services to provide the convenience of online ordering to their customers. The general belief is that it is easier to get started on such platforms and get more orders without any investment in terms of time and resources. However, what they fail to factor in is that the additional revenues generated by orders received via these platforms is usually diluted by the hefty commissions charged by them.

At this point, it is advisable to consider the long-term benefits of building your own online ordering platform. Initially, you may have to put in some efforts to promote your online ordering platform but these are resources invested in building your brand that have the potential to deliver huge dividends in the future.

There are several robust online ordering solutions in the market, which are commission-free and are available to restaurants totally free of cost. There are a few things you should keep in mind while selecting an online ordering solution:

What are the key features of an online ordering solution?

  • Simple configuration: Most modern solutions are easy to setup and configure and allow to start taking online orders within 24 hours.
  • POS integrations: An integrated online ordering solution does away with the need for manually updating orders. Your online orders appear on your POS along with other orders, and all menu updates on the POS are automatically reflected on your online ordering platform.
  • Customer data: if your online ordering solution is integrated with your pos, the customer data from online orders appears with all other data on your POS.
  • Customizable: You should be able to customize the platform, upload pictures and add descriptions to align with your brand identity.
  • Customers should be able save their preferences and customize their orders easily.
  • Accept Multiple Payment Options
  • Integrated feedback and loyalty program help you to build a loyal customer base.

2. Streamline your online ordering menu

increase restaurant sales with online ordering
Chipotle Online Ordering

A lot of thought should go into creating your online ordering menu. Some items that may be very popular in-store might not lot lend themselves to pick-up or delivery. Evaluate each menu item on the following three criteria to come up with the ideal menu.

  • Whether they do or do not travel well
  • Whether the margin on the food item is enough to cover packaging/delivery costs.
  • Packaging considerations

Your online order menu should include only those items that travel well and at the same time have a high popularity and profitability score.

3. Optimize Your Online Ordering Platform

The online ordering platform is an extension of your brand, and you should take utmost care to build the same customer experience on your online ordering page that customers have come to expect from your brand.

  • Customize every aspect of the solution to align with your brand identity.
  • Upload good quality food images and detailed descriptions of food items.
  • Arrange menu items like they would appear on your in-store menu.
  • Create up-sell or cross-sell opportunities by creating pop-ups for popular items or items that are usually ordered together.
  • Streamline and smoothen the customer journey on your online ordering platform by setting up automations such as helpful tips and suggestions or allowing customers to save orders or delivery address etc.

4. Make It Easy To Order Right From Your Website

In most case, customers land on your online ordering platform from your website. The order online button should appear prominently on the top of your home page and menu page to grab the customers attention. Highlight your specials and consider adding add to cart buttons to menu items.

5. Leverage Digital Channels to Promote Online Ordering

You should build a strong online identity by adding the order online button to all your social media handles including Facebook, Instagram and GMB page. Platforms like Yelp and Tripadvisor also allow you to build your restaurant page and add an order online button to lead customers to your order online platform.

Each day thousands of customers are searching on Google for restaurant like yours using keywords or terms related to your business/menu. You should optimize your website for these key search terms. Research keywords for your restaurant and include them in your page’s body, header, title tags, and Meta description and your sit’s SEO.

Build your website’s credibility and trust with the search engines by adding your restaurant to relevant local listings including Google maps, Apple maps, Yellow book, Map quest and Nextdoor.

increase restaurant sales with online ordering

7. Promote Your Online Ordering Platform

You would want your customers to know that you are accepting online orders. Promoting your online ordering platform through organic and paid channels can help your reach more customers and increase restaurant sales with online ordering.

In-Store Promotions
  1. Promote your online ordering link via window displays and posters in prominent places such as the check out counter.
  2. Grab the attention of your customers when they are waiting for their food to arrive with table tents.
  3. Menu inserts are also a great way to reach your customers.
  4. Ensure that your online ordering link is prominently printed on your takeout packages and receipts.
  5. Train your staff to promote your online ordering platform to your customers.
Online Promotions

Social Media platforms can be a great tool to reach your customers. Besides regular posts promoting your online ordering link, you should also consider advertising to reach your target audience on these networks.

  • You could create a special offer or discount to promote online ordering among your customers.
  • Run contests to promote online Orders.
  • Run Ads to promote online ordering

8. Leverage Data To Build Loyalty

Use data from your online ordering solution to create targeted promotions fostering brand loyalty. Segment customers based on their purchase history, preferences and visit frequency and come up with customized offers to bring back customers. For instance;

  1. Offers to bring back dormant customers
  2. Offer on kids meal to bring back customers with kids
  3. Deals to increase average order value of regulars
  4. Flash offers to increase online orders on slow days
  5. Offer available only on online orders to incentivize customers to place pickup orders during rush hours.

Streamlining the customer experience on your online ordering platform and targeted promotions can help you build your brand and increase restaurant sales with online ordering.

Increase Your Restaurant Revenues with FoodKonnekt Online Ordering

How to select the Best POS for Your Restaurant

How To Select The Right Point of Sale Solution For Your Restaurant?

The Point of Sale (POS)  solution is the most crucial software for your restaurant, which helps you to manage and track your restaurant operations efficiently. Modern Restaurant POS technology can take care of almost all your restaurant management needs with features such as automatic billing, inventory management, real-time reporting, and Customer Relationship Management (CRM).

The restaurant POS market is fast evolving and there are tonnes of options in the market with varying capabilities and prices. It often becomes difficult for restaurant owners to keep pace with the latest in point-of-sale technology and select a system that is flexible and can adapt to their growing business needs. In this article, we will help you to choose the best Point of Sale solution for your restaurant.

What Does a Restaurant Point of Sale Solution Do?

 Selecting a Restaurant POS System

The main function of a restaurant point of sale system is to accept customer orders, send orders from customers to kitchen staff, and process payment. However, with the recent advances in technology, POS systems come with many advanced features:

  • Menu Management
  • Inventory Tracking
  • Analytics & Reporting
  • Employee/Labor Management
  • Table & reservation Management
  • CRM (Customer Relationship Management)
  • Loyalty/Rewards Program Management
  • Online Ordering and Delivery

What Are The Benefits Of A Restaurant POS?

1. Cloud based POS solutions let you check your store data  from virtually anywhere giving you the freedom to manage your store remotely,
2. You track the various transactions that occur on your POS minimizing theft and wastage
3. Accurate order processing and streamlining staff operations translates to better customer service.
4. You can avoid shortages and overstocking by tracking your inventory including  menu items and ingredients.
5. Reduce wait time  by  faster order processing, better table management and increase in overall efficiency of kitchen operations.
6. Better Staff management
7. Built in loyalty program and online ordering to boost sales
8. Smart analytics and real time Reports can help you make informed business decisions

What Does a Restaurant Point of Sale Solution Do?

The main function of a restaurant point of sale system is to accept customer orders, send orders from customers to kitchen staff, and process payment. However, with the recent advances in technology, POS systems come with many advanced features such as
a. Menu Management
b. Inventory Tracking
c. Analytics & Reporting
d. Employee/Labor Management
e. Table & reservation Management

What are the Must-Have Features In a Restaurant POS system?

The nature and size of your restaurant business ultimately determine which POS solution will work best for you. However, there are certain key features that help you to maximize efficiency
Ease of Use
Flexible Payment Options
Real Time Reporting and Analytics
Offline Availability
Customer Data Recording
Third Party Integrations
Table Reservation System
Employee Payroll Management

How To Select The Right Point of Sale Solution For Your Restaurant?

1. Establish your Pos Needs by creating a personalized checklist
2. Compare Solutions and evaluate costs
3. Take the opinion of your friends in the restaurant business to narrow down your list.
4. Always ask for free demos to help you understand the features and determine the ease of use. 
5. Remember to talk to your staff and management before finalizing any system.

How Much Does A Restaurant POS Cost?

The cost of a restaurant POS system is largely dependent on the nature of your restaurant and the functionalities that you are looking at. It can be anywhere between  $600 for handheld tablets to around $2,600 for a fully-featured pos system with terminals.
You may also need to purchase additional hardware depending on your requirement such as a barcode scanner, additional tablets, receipt printer(s), a router, networking cables, or even a server. Besides the hardware you would also need robust software to run your system. Prices start from $69/month and can go up to $150/month per terminal again depending on the size of your business and the additional features that you would like to include.

Must-Have Features In a Restaurant POS system

The nature and size of your restaurant business ultimately determine which POS solution will work best for you. However, there are certain key features that help you to maximize efficiency. 

1. Ease of Use

One of the first things that you need to consider is the time and resources required for the on-site installation of the POS solution. Most efficient solutions nowadays are more or less plug n play. The system should be up and running in under an hour. 

You should also ensure that the solution is fast and intuitive. Remember that your staff will be using the system on a regular basis and they should find it straightforward and efficient. It should be easy to set up and update your menu and create coupons or take orders.

2. Flexible Payment Options

With changing times, more and more customers do not carry cash and prefer to have options while paying their restaurant bills. Your POS solution should have multiple payment options including credit cards, debit cards, and also support virtual wallets like Apple Pay and Google Pay. It should allow you to manually edit items and modifiers in an order, cancel charges or carry out operations such as splitting or merging invoices between two people/tables.

3. Real Time Reporting And Analytics

Real-time reports and analytics can give you a clear picture of your restaurant business and help you in making insightful decisions. A good restaurant POS system allows you to view and compare reports for selected time periods enabling you to track growth and build your strategies over time. 

Most systems come with pre-built reports for all incoming and outgoing expenses of your restaurant including

  • Store summary
  • Sales report
  • Online order report
  • Special pricing
  • Labor and inventory reports
  • Sales comparisons between locations or across time periods
  • Peak performance by day of the week, holidays, and promotions
  • Trends of sales vs. guests by day and top-selling item reports

However, if you are looking for more, you should opt for systems that allow you to generate custom reports according to your specific requirements and allow third-party integrations for more granular reporting. Auditing reports are also a useful addition to help you keep track of your sales and taxes.

4. Offline Availability

Your POS solution should be able to function smoothly and efficiently even when it is not connected to the internet. You should be able to accept credit card transactions safely and securely and continue normal operation even if your internet crashes and update all data on the system as soon as your internet services resume.

5. Customer Data Recording

To distinguish themselves from the crowd, restaurants must focus on delivering experiences that are specifically tailored to the needs and preferences of individual customers. Gathering customer data is the first step towards providing a personalized experience to your customers and streamlining your marketing messages. For instance, insights about popular menu items and coupon/offer redemption can help you optimize your menu and specials. By analyzing customer purchase history you can gain valuable insights including customer preferences, preferred time, and day to order or preferred mode of payment. This data helps you to craft targeted marketing messages. 

Your POS solution should help you to save, organize, and analyze customer data. 

6. Third-Party Integrations

You may already be using several technologies at your restaurant such as order, payroll management solutions, online ordering, or loyalty programs. You should choose a POS system that can be easily integrated with these tools to make efficient use of your existing technology and to ensure that you don’t have to manually transcribe data from one system to another, In either case, the ideal Point of Sale solution for your restaurant should be open to third-party integrations.

7. Inventory Control

There is a definite advantage in having the inventory control feature in your restaurant POS. Everyone in the restaurant industry is well aware of the problems with manual tracking and forecasting of inventory. A regular inventory management process can help you keep track of your individual inventory items and control and manage to eliminate pilferages/wastages.

8. Table and Reservation Management

Although not an essential feature, it is undoubtedly desirable to have Table and reservation management functionality in your POS.

The Table and Reservation management feature in your POS helps you provide a better customer experience by allowing customers to reserve tables online or through mobile apps. Customers can also leave reservation notes like food preferences and allergies making it easier for front staff to serve tables.  

In addition to providing a smoother dining experience, the table and reservation management also enables you to track  and manage reservations easily and effectively and streamline operations at the back end by enabling you to perform a diverse range of activities including:

  • Seat customers faster
  • Track guest status to provides an accurate estimation of wait times
  • Ensure faster table turns 
  • Enable front staff to assign tables
  • Optimize floor plans
  • Track staff performance

9. Employee & Payroll Management

Managing restaurant employees can be challenging. One of the best features of a good solution is employee and payroll management which can help you manage your labor efficiently. Ensure your restaurant POS solution includes features that allow you to

  • Manage or create new employees or set wages
  • Track employee hours and calculate both regular and overtime pay.
  • Control permissions so you can decide the nature of access or permission you want to provide to different categories of your employees.
  • Capability to run payroll.  

10. Additional Features and Functionalities

While these are the key features to look for in a Point of sale solution for your restaurant, there are several additional features that you may want to include:

  • Reliable customer service and technical support
  • Cloud-enabled features for effortless access from multiple locations
  • Integrated feedback mechanism An integrated feedback mechanism enables you to send feedback forms to your customer’s mobile phones after they complete their meals. 
  • Security features
  • Customer Relationship Management CRM integrated with your POS allows you to send customized marketing messages to your customer base.  

How To Select A Restaurant POS Solution?

1. Establish Your POS Needs To Create A Personalized Checklist

You may already have a budget in mind, but before you consider costs you should create a list of features that you definitely want and another list of additional features that you would like to have after considering associated costs.  The items in these lists will primarily depend on the nature and concept of your restaurant. Here is a generic list:

Must Have
  • Simple User Interface
  • Flexible payment processing
  • Gift cards management
  • Multiple payment Option like split and merge checks
  • Offline Credit Card processing
  • Insightful reporting
  • Reliable customer support
Nice To Have

Now that you have your checklist in place, you can start comparing solutions and evaluating costs.

2. What’s the Cost of the Point of Sale Solution for Your Restaurant?

There are two main categories of costs for restaurant POS costs; the upfront costs and the recurring costs. 

Upfront Costs include 

  • Hardware costs
  • Setup, installation, and training costs
  • Software licensing costs
  • Cost of Additional features
a. Hardware costs

includes the cost of all hardware that you will need to acquire for setting up the POS solution and depends on the type of POS you are planning to purchase

  • Cloud-Based Systems: These systems store data on remote servers and you can access data from anywhere provided you have an internet connection.
  • Legacy Systems: Legacy systems store data on internal back-office servers and run on a closed internal network.
  • Front of House equipment: This includes equipment such as terminals, stands, credit card readers, printer, guest-facing display, and others
  • Backend Equipment such as A kitchen display system.
  • Internet hardware such as routers, modems, and cables.

You may have some of these products in place so you need to consider the cost of acquiring the others.

b. Software Costs

It’s necessary to have reliable, durable POS hardware, but it is equally important to invest in robust software that is updated on a regular basis to save you time and money in the long run. 

Cloud-based POS systems usually have a monthly or yearly subscription fee and it may vary between vendors. Legacy-on-premise software, on the other hand, usually charges you per station/user basis. Here are a few things you should look for in a POS software

  • How often is the software updated and does the subscription include free updates and feature releases?
  • Does the software subscription include prompt customer support?
c. Cost of additional features:

This includes the cost of software integrations and any additional features that you may want to purchase such as online ordering, delivery app, team management system, and loyalty program.

Ongoing Costs

  • System maintenance
  • Updates and upgrades
  • Monthly or annual service fees
  • Credit Card processing rates

3. Compare Options

With a budget in mind, you can start comparing the options available in the market. Take the opinion of your friends in the restaurant business to narrow down your list. Always ask for free demos to help you understand the features and determine the ease of use. Remember to talk to your staff and management before finalizing any system.

How To Write A Restaurant Business Plan?

The restaurant industry operates on thin margins and competition is cut-throat, to say the least. According to the stats, 60% of restaurants shut down within the first year of operations, and up to 80% of the restaurants close their operations in the first five years. Opening a restaurant in itself is a daunting task, there are so many costs and factors that need to be weighed in before actually starting out. So, how do you ensure success in such a scenario?

Like some would say, a good concept and great food are all you need to get started. But, the truth is that it may be enough to get you started but to keep you in business in the long-term you need a good plan and foresight.

A restaurant’s business plan is the blueprint of what your future restaurant will look like, how it will operate, breakeven, and finally be the profit-making venture that you envisioned. It lays down your goals for your restaurant and the path you must take to achieve them. 

Why Does Your Restaurant Need A Business Plan? 

1. Helps You Define Your Vision

Having a business plan helps you give shape to your ideas. When you sit down and put your vision on paper, it helps you put your ideas to test and analyze each aspect more fundamentally. This exercise can also be very helpful in getting your ideas across to your team or partners.

2. Builds A Road Map

A restaurant business plan not only defines your visions but also lays down the detailed path that you can follow to execute your ideas.

3. Accounts For Operational & Financial Expenses

A restaurant business plan enables you to consider all the expenses that will be incurred for the first six months of operation including fixed costs and re-occurring expenses. Projecting these expenses and comparing them to your expected revenue streams helps you gain a better understanding of your financials. It also gives you an opportunity to plan your investment and loans while controlling and managing expenses.

4. Evaluates Your Roadmap

A business plan not only helps you create a roadmap to follow, but it also helps you set benchmarks for your business and assess the on-going progress. Setting up timelines helps you adhere to your plan.

5. Reduces Risk Factors

There are many factors, internal as well as external that could impact your restaurant business. It is essential to plan and be on top of opportunities and the risks that are involved in running a restaurant. A restaurant business plan helps you stay on course and prepares you for contingencies.

How to open a restaurant?

1. Decide on the concept of your restaurant
2. Decide The Location For Your Restaurant
3. Design A Stellar Menu
4. Arrange Suppliers & Vendors For Your Restaurant
5. Evaluate All Restaurant Costs
6. Prepare A Business Plan
7. Work Out Investments To Fund Your Restaurant Business
8. Choose Your Restaurant’s Name and Legal Structure and Procure Licences
9. Get Restaurant Insurances
10.Get Manpower For Your Restaurant Business
11. Install Right Technology At Your Restaurant
12. Create a Restaurant Marketing strategy

How can I get a loan to open a restaurant?

There are several types of loans available for opening a restaurant
A term loan from a “brick and mortar” bank.
1. SBA Loan.
2. Working Capital Loan
3. Merchant cash advance
4. Business line of credit
5. Equipment financing
6. Crowdfunding

How much does it cost to open a restaurant?

Opening a restaurant can cost you anywhere between $95000 to 2 million depending on the nature of your restaurant and also on whether you want to own the building or lease it.

How long does it take for a restaurant to become profitable?

Restaurants operate on a thin profit margin with the average profit margin after removing all other costs hovering at around 6.2 percent only. Very successful restaurants are able to break even after approximately two years of operation while average ones may take 4-5 years.

How much profit should a restaurant make?

The average profit margin for the restaurant industry is somewhere between 3-6 percent , however for individual establishments it can vary between 0-15%.

How much does a successful restaurant make in a year?

Successful restaurants can make anywhere between $29,000- $160000 per year while the national average is at around $65,000 per year.

How to create a restaurant business plan?

Here are some of the key elements of an effective restaurant business plan:
Executive summary
Business overview
Industry analysis 
Marketing plan
Operations plan 
Financial analysis 

Key Elements Of a Restaurant Business Plan

Key Elements Of a Restaurant Business Plan

Here are some of the key elements of an effective restaurant business plan:

  1. Executive summary
  2. Business overview
  3. Industry analysis 
  4. Marketing plan
  5. Operations plan 
  6. Financial analysis 

Now let us take a deeper dive into the specifics 

1. Executive Summary of Your Restaurant Business

The executive summary of your restaurant acts as a summary introduction to your business. It should cover all aspects of your restaurant including the concept, your target audience, and the financials. 

The executive summary is essential in business plans that are being presented to outsiders, say bankers or investors. A lot of investors make their decision based only on this summary, so it falls on you to grab their attention from the word go! Start with a mission statement and the concept behind your restaurant and include the legal structure and ownership. Add a short overview of your target market, your team, competition, and your financing needs. Mention your previous experience in the restaurant industry, your areas of expertise, and your plans for the future of your current restaurant venture. Remember people have short attention spans so your summary should be persuasive but also to the point.

On the other hand, if the executive summary is only for internal purposes then you would be better off spending your time on Business overview and operational plans.

2. Business Overview

The Business Overview is like a description of your restaurant. It should talk about the concept behind your restaurant and what makes it unique or stand out among the competition. Focus on the following aspects:

  • What is your restaurant’s USP
  • How is it different from other similar restaurants in the market
  • Who will be your target audience?
  • What service/product will you provide to your target clientele?

Once you have explained the concept of your restaurant, you can move to other specifics.

  1. Management Team
  2.  Type of Service and Interior layout
  3.  Sample Menu
Restaurant Business Plan: Business Overview

a. Management Team

The business overview should include the details of your Management Team and the responsibilities assigned to each member.

b. Type of Service and Interior layout

Based on the concept of your restaurant, you may already have a service type in mind; fast-casual, fine dining, or others, so you can start working on particulars like restaurant layout, interiors, and other details. 

The layout and the interiors of your restaurant should not only be in-sync with the brand identity that you want to project but should also be practical keeping in view the service type. The colors and the imagery you use inside your restaurant should be a reflection of your brand. Adhere to your brand theme while designing your menu and deciding on the uniform of the waitstaff.

c. Sample Menu

It goes without saying that if your customers like your food, your restaurant will be able to survive the competition. So, thw menu should be the focus of any restaurant plan. Discuss each item that you wish to include on your menu with your head chef before finalizing it. Analyze details like recipes, raw material sourcing, and price points. Once you have come up with an initial list with prices, compare it with the menu of other similar restaurants in your vicinity. Check what items they are offering and how your prices compare to them.  After you have weighed up all aspects, prepare a sample menu including only those items that meet both the popularity and profitability criteria.

The right way to go about menu additions is to optimize your menu over time.  Menu items that are not popular and less profitable can be replaced with new entrees that you feel have a higher chance of success.

3. Industry Analysis

The Industry Analysis primarily consists of 

  • Target Audience Analysis
  • Location Analysis
  • Competition Analysis
Restaurant Business Plan: Industry Analysis

a. Target Audience Analysis

 Based on the concept of your restaurant, you would obviously have an understanding of the type of customers that your food and restaurant would appeal to. Analyze the customer demographic including their income level, education, interests, and behaviors such as specific food habits, and spending habits. This study will help you understand your customers and serve them better.

b. Location Analysis

Finding the ideal location for your restaurant is one of the biggest challenges that you will face. While selecting the location keep the concept of your restaurant and your target audience in mind. You should select a location that has ample space for the layout you have in mind and is in an area that is frequented by your target audience. Here are a few things you should consider while selecting a location for a restaurant.

  • The location of your restaurant should be easily accessible and should ideally have a parking area.
  • Figure out how you plan to manage the supplies in the future. 
  • If you have plans to offer delivery through third-party services, you should consider a waiting space for delivery drivers.
  • Also, consider if there is adequate space for any expansion plans that you might have in the future.

c) Competition Analysis

The restaurant industry is a highly competitive industry. Analyze the competition in your area. Identify and create a list of all the restaurants in your vicinity both with similar concepts and those with an entirely different concept catering to a different target audience altogether. Study each of your competitor in detail:

  • Restaurant type/ their target audience
  • The kind of cuisine they serve
  • The strengths and weaknesses of your competitors.
  • Promotional/marketing strategies
  • Their growth rate 

You should also check their website, reviews on their pages, and their other social media profiles to get a comprehensive view of their business.

SWOT Analysis

A SWOT (Strength, Weakness, Opportunity, and Threats) Analysis must be included in your Restaurant Business Plan as it helps you identify all factors that can impact your restaurant. 

a) Strength- Focus on the key strengths that distinguish you from your competitors. Something that you do better than anyone else- it could be your food, your competitive pricing, prime location, superior service, low-cost resources, etc.

b) Weakness- Weaknesses are inherent features of any organization. These are the weak links that you need to work upon. Analyze each aspect including your staff, resources, procedures, training, and equipment to check where you might be falling short.

 c) Opportunity- Opportunities are upcoming trends in the market that your competition has failed to capitalize on. If you are able to spot and exploit these opportunities at the right time, it can help you leverage your restaurant’s growth. 

d) Threats- Threats are external factors that you have no control over yet they can affect your business. It could be anything from new competition, a shortage of supplies, or a natural disaster.  The best way to deal with threats is to have a contingency plan in place.

5. Operations Plan

The Operations Plan covers every aspect of the daily operations of your restaurant

  • Restaurant Licences and Permits
  • Technology Stack
  • Staff Management
Restaurant Business Plan: Operations plan

a. Restaurant Licenses and Permits

There are several licenses and permits that you need to acquire to open any kind of restaurant.  The nature of licenses and permits that you require depends on the kind of restaurant that you are planning to open and the costs to acquire them may vary from state to state. 

Here are some other licenses and permits you’ll most likely need:

  • Restaurant Business License
  • Restaurant Food Service License
  • Food Handler permit
  • Employer identification number
  • Certificate of occupancy

Licenses may take time and money to acquire so you should start procuring them beforehand.

b. Restaurant Technology Stack

Over the past decades, we have seen a huge growth in restaurant technologies that assist almost every aspect of the day to day functions of a restaurant. Investing in some basic restaurant technology is crucial to the success of your venture. Create a list of technologies that you consider essential to your restaurant and research the different options available in the market before investing in anything.

Some of the essential restaurant technologies should be looking at are

  • Point of sale system
  • Kitchen Display Screens
  • Guest Management Systems
  • Tabletop ordering and mobile payment
  • Online ordering
  • Customer loyalty and gift cards

c. Staff Management

The success of any restaurant depends on its food and customer service. Your staff is an extension of your brand so you should take utmost care while hiring employees. It is best to create certain guidelines for hiring staff and adhere to them as closely as possible during the recruitment process. 

Work on an outline framework of the staff you would need including the number of employees you would need in each area of operations; kitchen staff, waitstaff, and management staff. You should also work out details of the recruitment procedure and job descriptions for each category of employee. 

Training the Staff

Every restaurant should have a training manual in place for each category of employees. While it is important to provide training to all new employees it is equally important to organize training programs on an ongoing basis. You can maintain service standards at your restaurant by keeping your employees up to date with the latest guidelines for food preparation, healthy kitchen practices, and smart waste management.

While training your staff you should lay down structured guidelines on what you expect from them in terms of customer service. Make a list of all tasks that a server goes through in a day, for instance greeting guests, pre bussing tables, taking orders, making menu suggestions, serving food, taking orders by the phone, and the like. Provide clear guidelines for each task in your training program. It is critical to train your front staff in dealing with customer complaints and queries.

Technology has completely changed the way restaurants work and function. Training your staff to use the full stack of restaurant technology that you may have invested in helps you increase their efficiency and productivity and make full use of the available resources.

6. Financials

While writing the business plan for a restaurant, you must include financials including a balance sheet, cash flow statements, revenue projections, and cost analysis. This will help you to keep track of your cash flow and control expenses. 

Restaurant Business Plan: Financials

a) Cash Flow Statement

It is the record of where the money is coming from and where it is going. 

Capital:

Opening a restaurant requires substantial capital and you need investors or partners, so it becomes important to plan financials. Your restaurant business plan should include details of your finances and how much you are ready to invest.

  • How much capital you are investing and where it is coming from?
  • Allocate funds to operating expenses, fixed expenses, marketing, and other departments of your restaurant.
  • How long can you support the system? 
  • When do you expect to break even?
  • Apart from that also set up a contingency fund for unforeseen events. 

Expenses:

Capital and Operating expenses give you the details of where the money is being spent.

  • Capital expenses are long-term investments that are non-recurring in nature. It includes the cost of equipment and machinery, cost of utensils, interior designing cost, furniture, cutlery, crockeries, and other fixed expenses.
  • Operating Expenses:  These are the costs that you will incur to run your restaurant on an ongoing basis like salary, rent, electricity, etc. You need to project these costs and include them in your plan.
  • Cost Projection- You should include cost projections for at least 6 months in your business plan.
  • Revenue Projections for the first six months.
  • Projected Statements of Income

For a more comprehensive guide on how much does it cost to open a restaurant, you can check out this article which breaks downs all the relevant costs involved in opening a restaurant.

7. Restaurant Marketing Plan

You should have a marketing strategy in place before the launch. Plan out a budget and a strategy for both online and offline marketing.

Restaurant Business Plan: Restaurant Marketing Plan

a. Online Marketing

 Research your competitors to understand how to utilize the various social media channels. Needless to say, your online identity is an extension of your brand and you must ensure that you adhere to your brand image and voice in all your online communications.

  • Website
  • Social Media Platforms
  • GMB
  • Email Marketing
  • SMS Marketing
  • Chatbot Marketing

b. Offline Marketing

A sound offline marketing strategy can help you reach more customers and generate footfalls in the initial days of your restaurant. Plan your launch carefully, most restaurant owners prefer to go for a soft launch for only close friends and family to generate initial feedback on their food and services.

However, going for a soft launch does not mean that you need to slow down the promotions. Ensure that you promote aggressively during the pre-launch period through flyers, and ads(both off-line and online. Organizing an online contest is also a great way to generate interest in the community before your launch. 

Your long-term off-line strategy should include:

  • Engaging with Food Bloggers
  • Hosting Events 
  • Advertising through signages and billboards
  • Distributing pamphlets
  • Radio Mentions
  • Television or Newspaper Advertising
  • Partnering with local organizations for fundraisers
  • Coupon distribution

c. Customer Relationship Management

It is vital for any restaurant to manage and use customer data to guide their future marketing strategies. An integrated customer relationship management tool can help you to store and use important customer data.

  • Contact Details: Phone number, email, address, bday, etc.
  • Visit Frequency
  • Preferences or most ordered Menu items
  • Average Spend per visit.

A restaurant CRM platform that is integrated with your POS system will help you stay engaged with your guests and customize your marketing messages based on the previous purchase history of the customers. Ideally, your online ordering solution and loyalty program should also be integrated into your POS. This will help you gather customer data from all sources and use it to provide a superior customer experience.

Here are a few sample Restaurant Business Plan Templates

Wrap Up:

Coming up with a restaurant business plan requires a lot of patience and attention to detail, but is it definitely worth the effort. The time that you spend strategizing and fine-tuning every aspect of your restaurant business translates into smooth execution of your ideas.

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