Can you open a restaurant on a budget?
What is a Realistic Budget for a Restaurant?
Now, there’s such a thing as opening a restaurant on a budget and being totally unrealistic. You can’t go into a luxury car dealership, put $500 on the table and expect to be able to drive away in any of the cars. As such, you need to work with a budget that is going to support the establishment and operation of a new restaurant. Food trucks can be run with a starting budget of approximately $20,000, while smaller food stands might need an initial investment of around $35,000. Any kind of restaurant where you are going to be employing servers, cooks, dishwashers, and managers, needs around $250,000 for an initial investment.
How to Open a Restaurant on a Modest Budget
Some people hoping to open a restaurant are actually using their life savings to follow their dreams. As such, they really need to see their investments become profitable fast. This category of restaurateur should begin by offering a limited menu and only open for business during one shift. For example, restaurants that serve brunch can become highly profitable as they get to tap into both breakfast and lunch service. Breakfast foods like eggs, pancakes, grits, and biscuits are also very inexpensive to make so there’s the opportunity for newer restaurants operating on a budget to stay afloat.
Reinvesting Into Your Restaurant Business
Although you have plans to open a new restaurant on a shoestring budget, you should also expect there to eventually be profits. When you have a restaurant that is bringing money in, you can reinvest as well as increase your budget. Doing things like adding more tables so that you can serve more customers will absolutely help you to improve your business’s bottom line. Having more money so that you are able to hire more staff will also help your restaurant to grow. All profitable restaurants change their goals over time, so don’t be afraid to change your operating budget from $2,500 a month to $5,000 if your profits will support the transition.
If you come to the industry with a realistic budget, you can open a restaurant selling almost any kind of food. Avoid launching a seafood-themed restaurant or serving any kind of food that you aren’t very familiar with. Lastly, think small and quaint rather than a restaurant with 500 seats, to begin with.
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