Starting a fast casual restaurant

[ls0709]

Hi guys,

My name is Luke and I'm currently in the process of researching (and hoping to start) a fast casual restaurant.

I have no prior experience of working with the catering industry but have many years of marketing experience, customer service work and have previously ran a small import export business.

The fast casual sector is showing huge promise as a growing niche market and statistics over the past 5 years show a continued growth within this area. I have built a strong niche business that doesn't currently exist within this part of the market and that I believe could be very successful within this industry and have been given a place on a mentorship course by a local university to help me put the business together. The course is provided by The Hive at Nottingham Trent University. The type of business I am basing my model on are the BarBurrito restaurants which now have a turnover of around £24mil so it is a huge business at the high end.

I have done lots of research into the sector and will be continuing to do so over the next 12 months that the course runs for. I believe that due to it's nature of not being a full restaurant providing lots of covers and a varied menu, that my lack of experience will not be a distinct disadvantage and although I have no plans to be the chef myself and will require staff, I feel my marketing and man management skills will allow me to get the business going.

I am aware I will be relying strongly on an investment to get the business off the ground and have considered a family friend who is a business owner as a private investor as well as banks (if possible).

Does anyone have any advice or opinion on this start up they would like to share? I am very conscious of the fact I do not have experience but I am very passionate about this business and business in general and truly believe I can make it work.

Many Thanks

 

[Scalloway]

If you have no experience in the area how will you know you have hired the right staff?

 

[ls0709]

If you have no experience in the area how will you know you have hired the right staff?

I personally believe that with a fast casual restaurant the staffing is much simpler than a full restaurant. Although I don't want to be the chef, I can cook and will be keen to work with a head chef/cook. The other roles are then basically assemblers of the food/customer service assistants. Something of which I do have skills and experience is customer service and I follow a restaurant in the US, of which my business is based on that speak often and freely about how they built their business and team and so have learnt lots from them about finding the right staff and keeping them.

 

[The Byre]

Some observations in no special order -

1. These types of eating houses are very much en vogue and I personally like them.

2. You seem to be going in with your eyes open.

3. A restaurant owning friend of mine interviews chefs by asking them to make two simple things with eggs, a mayonnaise and an omelette. After that (some fall down on the mayonnaise!) he moves to a soufflé. He is always amazed at how many wannabe chefs think that mayo has something to do with opening cans!

4. Friends, family and fools - they will need an exit strategy.

5. I know of a similar place in Germany that happens to be the oldest bar/pub in the World that sells just four or five dishes and they are always full to bursting and the food sells brilliantly. A long and complex menu is usually a sign of bad food.

 

[fisicx]

I am aware I will be relying strongly on an investment to get the business off the ground and have considered a family friend who is a business owner as a private investor as well as banks (if possible).

This is going to be your biggest problem. To get the £100K+ you need to get started you will need a really solid business plan. The banks will want to be sure they get their money back so you will need to have experienced people on board, a mamager with catering experience for example.

There is notihng new about this business model, retail stores with restaurants have been doing this for years and many pubs now offer a limited range on the menu as they want you in and out in the shortest time possible. We were in London to see a show and went for pre-show dining - 3 staters, 3 main and 3 deserts was all that was on offer at a hight end restaurant.

The common feature of all these places is someone with a catering background calling the shots. If you want to make a go of your idea get a job waiting tables and get some experience. Or recruit someone who has the experience before you go to the banks.

My wife works as a risk manager for a bank and they get hundreds of requests like yours. Most fail because of a weak business plan, you have to show viability which means you have to show you know to run a restaurant.

 

[ls0709]

Some observations in no special order -

1. These types of eating houses are very much en vogue and I personally like them.

2. You seem to be going in with your eyes open.

3. A restaurant owning friend of mine interviews chefs by asking them to make two simple things with eggs, a mayonnaise and an omelette. After that (some fall down on the mayonnaise!) he moves to a soufflé. He is always amazed at how many wannabe chefs think that mayo has something to do with opening cans!

4. Friends, family and fools - they will need an exit strategy.

5. I know of a similar place in Germany that happens to be the oldest bar/pub in the World that sells just four or five dishes and they are always full to bursting and the food sells brilliantly. A long and complex menu is usually a sign of bad food.

This is going to be your biggest problem. To get the £100K+ you need to get started you will need a really solid business plan. The banks will want to be sure they get their money back so you will need to have experienced people on board, a mamager with catering experience for example.

There is notihng new about this business model, retail stores with restaurants have been doing this for years and many pubs now offer a limited range on the menu as they want you in and out in the shortest time possible. We were in London to see a show and went for pre-show dining - 3 staters, 3 main and 3 deserts was all that was on offer at a hight end restaurant.

The common feature of all these places is someone with a catering background calling the shots. If you want to make a go of your idea get a job waiting tables and get some experience. Or recruit someone who has the experience before you go to the banks.

My wife works as a risk manager for a bank and they get hundreds of requests like yours. Most fail because of a weak business plan, you have to show viability which means you have to show you know to run a restaurant.

Thank you for the responses.

The idea is that we aren't planning to seat many covers at all and as you mention, get people in and out quickly.

The mentorship course I have been offered a place on is done in three stages, the first being research, the second being viability and the third running an incubated version of the model with the main aim building the solid business plan needed as we are then put in front of banks, business investors, solicitors etc. to pitch our idea.

My partner has many years experience in the restaurant, serving trade and is going to be working with me on this and I will be working with industry specialists at the course but I am definitely going to start looking for some evening waiting work also.

 

[ls0709]

Similarly it may be worth mentioning that Mission Burrito was started by a couple with no industry experience who hired a chef/manager and now have 6 stores so it can be done but I'd be naive to not have my concerns.

 

[bovine]

Two things are the key to starting up in business - Money and experience. If you have one, you can often get the other. With neither, its going to be tricky.
Opening any kind of food outlet needs both in quite large quantities. Obviously you can hire in a good manager, someone who has experience of opening up new sites. But it will cost you and you would want them on-board at quite an early stage, to help with specifying what is needed to outfit the unit. Getting substantial funding is going to be a challenge for you without strong experience and the ability to demonstrate success in this industry.
I have a customer who has just opened up a new site, they sourced a large chunk of cash through crowdfunding, but they have a strong business plan and an easy to demonstrate success with the other sites. It works for him, but would not work for most.

Thats not to say its not doable, but its going to be a massive uphill struggle.

 

[businessfunding]

Agree with much of the above

Frankly my heart sinks when I receive yet another restaurant plan full of menus and floor plans

Create a strategic plan for your business which focuses on marketing. Staff recruitment and retention, sourcing and pricing

I'm afraid bank or commercial funding will be non starters without solid security although you might be able to back up with Asset finance.

Crowd funding or equity might be options if your business plan shows you have the a fumes to run this as a growth business

 

[ls0709]

Thanks again guys.

I feel that the opportunity of this course and getting the chance to work with industry specialist will certainly play a big part in me delivering a well structured business plan rather than another naff one full of pretty pictures.

I'm also in talks now with one of the mentioned QSR's that started with no experience who are willing to offer advice and talk with me about starting up and their experiences.

 

[The Byre]

Thanks again guys.

I feel that the opportunity of this course and getting the chance to work with industry specialist will certainly play a big part in me delivering a well structured business plan rather than another naff one full of pretty pictures.

I'm also in talks now with one of the mentioned QSR's that started with no experience who are willing to offer advice and talk with me about starting up and their experiences.

By all means listen and learn to the various industry insiders, but that does not mean that you have to do what they did!

My take (looking in from the outside) on the UK restaurant scene is that they are - with a few notable exceptions - serving some of the worst food on Planet Earth.

As much as I think your plan could be a real 'goer' I think your best bet is to save them pennies for a self-financing deal and start small - serving the very best food possible. If all you can offer, is the same factory food everybody else is offering, then you are just another fast food outlet with no real USP.

One of my sons wanted to become a chef, but after just one year he gave up. The real reason was that he didn't know how to eat. He could not taste the difference between a fresh and a frozen lobster, he did not know what to look for in an egg and how a good egg should taste. He could not even bake a good farmer's loaf.

Interestingly, now, many years later, he has learnt to eat and is today a very good cook!

So my advice to you (for what it is worth!) is learn to eat first. That means traveling to places like France, Vietnam, India, Louisiana and New York and all kinds of places in between and just learn about food.

There is little point learning about food in a country where nearly every chef thinks an egg yoke should be yellow, bread is something you buy, fish can be a day or two old and meat is pink and watery. Get out there and learn!

And, hey! Blow a few thousand and enjoy yourself! Look upon it as an investment!!!

THEN come back (if you still want to!) and apply what you have learnt and do something really different and funky!

 

[jasion]

Anyone knows any good alternatives to Open Table?

 

[colour24]

I think you will do really well. I opened a gym a while back. Everyone asked 'what do you know about gyms?' when I announced my plans. 'Nothing', I replied. I employ young fitness experts and I run the company. This allows me to look at the company as a business rather than just a gym. I love this approach and it allows me to think clearly about strategy ang growth.
You can do the same with your Chefs. Don't be tempted though to go into partnership with someone who is passionate about food. You will fall out over where the money should be spent. You must have total control for this to work. Good luck.