Restaurant buildouts are expensive, and opening costs can quickly get out of hand. Without careful planning and preparation, it’s easy to get in way over your head and quickly find yourself struggling for a life-preserver. Here are a few strategies to keep your up-front development costs low and help you gain some control over ongoing operational expenses.
Give Expert Evaluation to the Restaurant Location
Restaurant location is one of the most critical choices you have to make. Be sure to carefully evaluate whether or not the neighborhood can support your concept before investing. Furthermore, ensure that the structure itself can serve your needs. Can you efficiently produce your menu, serve your guests and monitor your dining room with the existing layout? Is the seating capacity the right size for the goals set in your business plan? It’s a good idea to bring in experts to help with the evaluation, especially those who are familiar with local building codes. They will see things you may not, such as the gas and electrical systems, proper venting of exhaust, the overall soundness of the structure and whether or not anything is going to need replacing.
Look for Lease Agreements with Concessions
All of this information will help you be a shrewd negotiator of the lease as well—another important aspect of controlling opening costs. Obviously, you want to be working with property owners who are flexible and fair; people you’d like to stay in business with a long time. Ask for a lease with a rent-free concession before the restaurant’s opening date to provide some cushion in case of last minute fixes or permit delays. If you’re sinking a lot of money into the building for renovations, approach the property owner about subsidies for the improvements you make to the building. If the opening of the establishment adds substantial value to the premises, some owners will even be willing to contribute some financial assistance to the venture.
Work Directly with Restaurant Architects and Builders—Plan for Maximum Efficiency
Sometimes a fresh coat of paint and new décor is all that is needed to open your restaurant’s doors. If renovations are in order, however, don’t miss the opportunity to plan the perfectly designed restaurant by working directly with your architects and builders. While it’s nice to find an architect with restaurant-specific expertise, the more important qualifier is how well he or she knows the local building codes and is able to bring your idea to life. Design for maximum efficiency in the layout of your kitchen and dining areas. Don’t make your servers and kitchen staff walk a mile to have what they need at hand. Review all plans with a fine-tooth comb. Now is the time to catch mistakes in design—changes made down the line can get costly.
Once you have your plans, it’s time to collect your builders. It’s smart to utilize a contractor for their carpenter contacts, project management and permit expertise. If you want to save a little on contractor costs, interview and get quotes from the plumbers, electricians and HVAC specialists yourself.
Opening a new restaurant can be an expensive and risky endeavor. With careful and strategic planning ahead of time, however, both cost and risk can be managed more successfully.
Jim Balis' Blog 