Fool Proof Methods To Manage Restaurant Start Up Costs For Running A Successful Restaurant


Food industry is one of the most successful businesses and hence an irresistible option for any entrepreneur with a taste for food and thirst for overwhelming success.

Just like in every other business there is a wrong side to restaurant business and that is poor management of restaurant startup costs.

Here is a guideline on what to expect in terms of start up costs and how to manage the same.

Startup Costs

“Expect the unexpected’ is the rule to follow while estimating the startup costs so that you are not thrown off balance by unwanted surprise costs. Startup costs vary based on the location, size and the type of restaurant. Regardless of the size and location, the startup costs given below are common and essential.

1) Rental Deposit

Rental deposit, unless you own the property, is among the first major startup expenses. Rental deposit will vary depending on the location and the size of the property.

2) Fees

Legal fees, registration charges, accountant charges and insurance fee form part of startup expenses.

3) Equipments

Right from plates to prep tables, ovens, grills and freezer the list is long for a restaurant kitchen. Chairs, dining tables, storage containers and everything related to cooking and eating has to be in place to get started. Fire extinguisher finds its rightful place in the list.

4) Interior Design

A sizeable share of startup expenses may go to decorating the restaurant’s interiors. A blend of antiquity with subtle exhibition of modernity is sure to attract the soul of diners for which you naturally have to dig deep in your pocket.

… And The Surprises

1) Hidden Behind The Wall?

Construction, most of the times, springs up surprises. The cost often exceeds the budget. Extra material and increased hours of labor can cost you dear.

2) S’trained Staff

Untrained staff may strain your relationship with success and hence a mistake committed here can be costly. Hiring the services of expert trainers to train the staff is another expense that may not have been included initially.

3) Musical Treat

Again, this may not have been your initial preference but once your restaurant develops and attracts more visitors you may look to entertain them with good music along with food. This, of course, may seem optional but can add value to your services. However, unlike the other surprise costs, this cost can be considered an investment.

4) Accidents

An accident at work place is another aspect to consider. While damage to staff and property can sadly not be undone, insuring can minimize the loss in case of an accident.

Managing Restaurant Startup Costs

Startup costs have been an absolute spoiler for many within the first few weeks into business. Not that everyone was short of capital and that why you need to be approved for restaurants loans but only with lack of effective planning. Whether you are on a tight budget or not, the following suggestions will help manage restaurant startup costs and ensure smooth transition from being a new restaurant to a successful one.

1) Buying Used Equipment

It is a new beginning for you and hence you may want everything new. However, make a comparative study of the costs involved in buying new kitchen equipments and used equipments and you are in for a change. Buying used equipments saves you a good deal of startup costs which you can reserve for unexpected expenses.

2) Interior Decoration – Think Twice

Interior design enhances diners’ experience but as a startup it may be too much of an expense to go for the ultimate decor. Designs that are easy on the pocket can equally attract diners if used right. Don’t overcrowd your restaurant with every décor that is on the market. Be simple, be the best.    

3) Table Cloth – Do Without

Table cloth brings in more work in ways of regular washing and maintenance. Table cloth is inexpensive but maintaining the same can be time consuming and such maintenance adds up to expenses. Opting for linen napkin is a good decision.

4) Advertise Effectively And Cost Effectively

Now with the above points some of the startup expenses are taken care of, consider the advantage of going online to promote your business instead of using expensive promotional campaign. Now that every restaurant going person is part of the internet world, reaching them through the same channel will not only be wise but also cost effective. Having your own website and an active presence in one of the leading social media can be the right way to start and continue.