Sample business plans for restaurant by margincause


Sample business plans for restaurant

More Info
									Sample business plans for restaurant

The Financial Analysis section of a restaurant business plan consists of pro forma
(projected) financial statements for the business. Before creating these statements,
consideration must be paid to these three key concepts:

Capital Expenditures

Likely the most pertinent portion of the Financial Analysis section will be the statement
of how much capital the restaurant will need in order start the venture. The trouble is that
too conservative of a projection will leave you with an investment amount that is either
unattainable or too large (creating excessive interest payments), while an overly
conservative projection will leave you vulnerable to running out of funds during startup
or operations.

When assessing the cost of capital expenditures, it is best to err on the high side. Attempt
to create a comprehensive list of all capital expenditures that your restaurant will need
even before it opens its doors. Go beyond the bricks and mortar of the location and
include decoration, furniture, tabletop items, serving trays, and kitchen equipment. Also
include software - restaurants commonly use POS (point of sale) software as well as
software for reservations, table assignment, credit card processing, and bookkeeping. A
rule-of-thumb is to include any one-time purchases expected to serve the restaurant for
years. Build in a buffer for unforeseen expenses, as running out of money in this stage
and attempting to secure another source of funding can be detrimental to the company's
launch and long-term prospects.

Operating Costs and Revenue

Operating costs primarily include COGS (cost of goods sold) and labor costs for a
restaurant. These costs can be determined surprisingly accurately after operation begins
because they simply aggregate the sum of how much it costs to produce the food you are
cooking and how much you must pay your staff. The problem, however, arises when
projecting the traffic your restaurant will see on a day-to-day basis and the average
purchase per customer. Try to be as realistic as possible and take into account the type of
clientele you are attempting to attract, what geographic area you are operating in, and the
foot-traffic that your establishment expects.

Cash Flow

The Cash Flow Statement is the most important statement for operating purposes once
your restaurant opens. When payments need to be made and a projection of future cash
receipts are key to creating reliable projections. Though it may not be necessary for other
industries, restaurants often create an unofficial worksheet that projects and monitors
weekly cash movements. This is primarily because restaurants have many moving parts
such as payroll, sales taxes, and shipments of goods which can create fluctuations from
week to week. For example, to achieve the lowest prices from suppliers, you may attempt
to purchase in higher quantities, which can put a strain on cash during a week where
these large purchases fall, although they might represent supplies which will serve for
many weeks or months. Thus, a cash buffer is extremely beneficial to guard against
shortfalls for even a profitable restaurant. – You can download free ebooks about: restaurant
management forms, restaurant business plan, restaurant marketing plan sample,
restaurant startup guide…

To top