Restaurants fail for a lot of different reasons, all of which come under the heading of poor planning. Since we've chosen the most competitive industry in the world to make a living, it shouldn't come as too much of a surprise. Even though the majority close their doors within the first year, restaurant failures continue at pretty steep rates, even after the five-year mark. And just because you're successful today, doesn't mean you'll be successful tomorrow.
One thing experts have been able to ascertain is that a business plan significantly reduces the risk of going belly up. If you don't have a formal business plan, it's not too late. More than a necessary evil to get money from a bank or investors, the process of developing a plan is enough to improve your chances of continued success. It's like writing down your personal goals... it's a step toward making your dreams become a reality, not a nightmare.
The folks at restaurantbusinessplan.com say that "it takes an average of 100 hours to research and write a comprehensive business plan within any industry." With their help, and customizable business plan templates,, you can get the job done a lot faster. Visit their web site for samples of their plans for specific concepts like coffee shops, full service, pizza restaurants, quick service, caterers, night clubs etc.
Whether you follow a template, or build it from scratch, I recommend a five year plan that includes both "the numbers" and strategic information. I think of the strategy as the game plan, and the numbers as the score. Once you've got your plan outlined, you can revisit it periodically to see how close you are to your projections, make revisions and hopefully pat yourself on the back.
The business plan should also include:
- Your vision, mission, and driving force
- Relevant demographic or economic conditions
- A competitive analysis of your trading area
- A description of your concept
- Marketing, publicity, and advertising plans
- Examples of your menus and signage
- Current financials or pro formas and projections
- A SWOT survey
- Organizational chart with biographies of key personnel
- Exit strategy
Tables of contents from your policy handbook, job descriptions, operations manuals, and training manuals. We've put together more business plan pointers including sample tables of contents, free downloadable business plan templates, and links to on-line resources for even more tips on putting together your plan.