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Restaurant City Startup Costs


Before you open a city restaurant

Putting up your own city restaurant is not easy to do since there are many factors and extensive preparations involved. Before you start building a restaurant in the city, you need to first decide on what kind of restaurant you would prefer to start, your target market, the location, volume of sales your business expects, overall restaurant ambience, number of employees to hire, the quality of the menu to be served and so much more. However, let’s focus more on restaurant city start up costs.

Several Factors to Consider when starting Up a City Restaurant

When you are at the stage of calculating the restaurant city start up costs, always expect that the overall costs will be higher than what you have estimated and start searching for business financing for startups. Here are some factors to consider when you calculate your restaurant city start up costs.

Step 1

Market Research: To know more about your business niche, you have to know about the trends and what the market wants. Your marketing activity may involve market research and surveys. Take note that the service charges for these services can be very costly especially when you outsource these tasks to a professional market research firm. However, if you do all these by yourself, you may save on costs but may also require a big chunk of your time.

Step 2

Licenses and permits. You need to furnish all necessary licenses and permits to prevent any legal issues in the future. You will have to visit your local government agencies and pay all legal fees needed.

Step 3

Restaurant Location: Location is very important in estimating costs when starting up a restaurant in the city. Location is essential in putting up a restaurant. Locations with high profile customer demographics near the neighborhood will be very expensive, compared to a low profile location. It is for this reason why restaurant locations in the city would be more costly to you compared to those in the suburbs.

Step 4

Construction. As soon as you have chosen your location, you need to prepare your finances for costs involved in building your restaurant. This will include needed construction materials, the legal permits for the construction of restaurant and payment for the services from contractors who will build on your restaurant.

Step 5

Tools & Equipment: Determine the tools and equipment you’ll need in your restaurant and make an estimate for the costs on kitchen tools, instruments, furniture and fixtures, accessories, interior designing costs, safety measures, and the installation expenses.

Step 6

Manpower Recruitment. It can be frustrating and time-consuming when you do the hiring of employees yourself. It is highly suggested that you hire the right candidate for your restaurant through your local recruitment agencies to assist you in short listing possible candidates. Make sure to add the service fees charge by these agencies to your restaurant city start up costs. Once hired, you need to prepare for employee compensation, benefits, uniform, bonuses, incentives and others.

Step 7

Marketing and Promotion. If you want for more people to know your restaurant’s existence and the products you offer, you need to promote your restaurant through concrete advertisements and forms of marketing promotion. Naturally, the advertising costs should also be taken into consideration for your restaurant city start up costs.

How to Finance your Restaurant Business

There are some options you can take when it comes to financing a restaurant. Your first choice would be to dip into your personal savings account. But if you don’t want to risk your own money for this business, why not borrow somebody else’s money? You can get a loan from one of your family members or relatives who might be willing to lend or you can also apply for small business loans from your bank or with other financial agencies. Normally, these commercial loans are backed by the government, so it's easier to acquire one.


By Ignat Victor, published at 03/08/2012
   Rating: 4/5 (11 votes)
Restaurant City Startup Costs. 4 of 5 based on 11 votes.