Have you always had a dream of opening up a quaint restaurant in town that everyone in the community loves and deems as their favorite? It is a lofty goal that needs to be thought out properly and thoroughly. Unfortunately, restaurants have a higher failure rate than any other start up business. However, with proper planning, failure generally can be avoided. Here are 6 important ideas to consider before heading into this adventure.
- Business Entity
Have you thought about whether you will be a sole proprietorship or a partnership? In the knowledge center of this website you will be able to learn about the differences, advantages and disadvantages of each business entity and how each are taxed. Whatever you chose, it is vital to make sure you protect yourself. An LLC for example is a great way to release yourself of personal liability. MaxFilings can help you achieve whichever business entity you choose.
- Employees and Insurance
Your restaurant will only be as good as the people you hire. It is extremely important that you understand all the basics of the hiring process, which include but are not limited, to workers compensation, wage requirements, illegal discrimination and the process of how to hire a good employee. Randstad Staffing Services is an extremely reputable firm that can help answer many of these questions regarding the hiring process. There is also a book by Fred Steingold called Employer’s Legal Handbook that could be beneficial to you as well.
This is probably one of the most important decisions you will make. A suggestion would be to do business with an insurance company that has insured restaurants in the past. An excellent general liability policy is key. A restaurant usually has multiple employees as well as a lot of people in and out of the establishment. Making sure you are covered if your employees get hurt on the job or if a customer slips and falls or, heaven forbid, gets food poisoning of some sort from your food! Get good insurance!!
- Marketing Research
It is very important to do your homework! Location is key!!! Where does a restaurant like you are considering opening need to be? What type of food do people in that area enjoy and what is the demand? Is there one just like yours right down the road? Research, research and research!
- Health and Safety
This is huge! You can be shut down in a heartbeat if you do not abide by health and safety regulations. You will be monitored on a regular basis from the health department. Not only do they inspect the raw and cooked food but they will look at your refrigeration systems, cooking equipment, and waste disposal as well. Make sure you are up to code on all of these. Safety for your employees and your clients is vital as well. Employees must have all the safety equipment needed from sanitary gloves to eye and face protection. All I’s must be dotted and t’s crossed in order for your restaurant to be successful when it comes to health and safety.
- Licensing and Permits
There are multiple permits necessary when running a restaurant. The permit for food handling will generally come from a local government office. If you plan on selling liquor, you will need a liquor license that may come from a state agency such as the liquor control commission. If you plan on having large crowds in your facility, a crowd control license may need to come from the local police or fire department. Check in the area that the restaurant will be located for all the necessary licensing and permits.
Opening and keeping open a good restaurant takes a lot of blood, sweat and probably tears. However, it can be worth it if it is your dream and done properly. Consider using business incorporation services at MaxFilings (http://www.maxfilings.com/business-incorporation.html) to get your legal business structure set up. Give us a try and you are under no obligation until you make the final decision.