Advice needed from a restaurant owner

[stuart12345678]

Hello there,

I'm looking to see if there's any owners of medium-sized restaurants on here. I'm looking at starting up a new themed restaurant in my area but I'm a marketing man by trade. Although I know about how to run a business, there are specifics of setting up a restaurant that I need clarification on. I would be really grateful if someone would answer the questions below as best you can?

- What could I expect to pay to get a decent commercial kitchen fitted at the cheapest price I could find?

- If I was looking at a 3,000 square feet premises, would I be looking at filling around 100-120 covers?

- What would you expect the turnover to be for a mid-priced restaurant (same sort of prices as Zizzi, Pizza Express etc)

- Do you have any idea (maybe based upon your own experience) what the annual costs are (utilities, not premises) to run a 120 cover restaurant at 3000 square feet?

- Any idea what is an acceptable salary for a head chef for a chain-style restaurant in a small town? How many chefs would I need to support him/her and a 120 cover restaurant?

Lastly, anyone that's interested in helping me and investing time and money in to a really good brand and restaurant concept - please PM me...

Thanks very much in advance,
Stuart

 

[Scotian]

I suggest checking out the auctions and second hand places for your kitchen equipment there are many restaurants gone out of business and there is always good equipment out there for cheap prices.
120 covers is ambitious, your biggest expense is going to be staffing as whether you have customers in house or not you need the coverage. Food expense and allowing for wastage is also a key expense especially when starting up. You also have to be prepared to put in a great deal of time yourself. Not to discourage you but think this through restaurants have one of the biggest turnovers of all businesses are expensive to run, and very time consuming for the owner. Consider what kind of marketing you have in place to fill the restaurant on a regular basis especially considering the size you plan on.

 

[Billmccallum]

better to have 50 covers seated rather than 70 empty seats......

 

[Scalloway]

H

- What would you expect the turnover to be for a mid-priced restaurant (same sort of prices as Zizzi, Pizza Express etc)

-

Count the seats, estimate the number of times tables turnover and what the average occupancy then multiply by the average spend. I would set up a spreadsheet with a number of values and see what you would need to cover costs.

The biggest financial headache I have found with a restaurant is VAT. Your sales all have VAT on top but you have very little VAT that is recoverable - your main costs are food (zero rated) and staff (no VAT). If you do not budget carefully at the end of a quarter you can have an unpleasant surprise when you do your return.

 

[Rasta Pickles]

You could always try the business model adopted by the guy who let the house next door.

He put six Polish types in there. They lived rent-free, he paid their council tax, broadband, electricity, gas and Sky tv.

In return, they worked at his restaurant for zero salary but they kept their tips.

He runs his restaurant at a massive profit because he has no salary overheads and he rents his property as a tax-free gain because no-one pays rent.

Even after three years of him telling me (with a big smile on his face) I'm still not sure if anything that he's doing is legal

 

[MikeJ]

Has he heard the phrase "minimum wage"? Are they paying tax on the benefit they're getting?

 

[Scalloway]

Possibly it's something like this

http://www.bbc.co.uk/news/uk-england-kent-19842821

 

[cjd]

I can't help with your numbers - but given your questions, it looks like you need real, professional help. If you have an accountant they'll usually have a few restaurants on their books and be able to help you with real life numbers.

BUT.

I live in a pretty active city with literally thousands of restaurants I also eat out a lot and, out of the thousands, there's less than a dozen I return to. The reason is food and service. It seems that it's almost exclusively incompetent idiots and chains that open restaurants - not people who can cook well and understand that their business is not part of the hospitality industry without reason.

It really isn't hard to run a successful restaurant you just need to know wtf you're doing but it seems to me that almost all of them haven't a clue.

 

[Rasta Pickles]

Has he heard the phrase "minimum wage"? Are they paying tax on the benefit they're getting?

Officially, I guess, they don't exist at payroll level?