Have you ever thought of starting up a restaurant business in Nigeria, this might be the right time to sit down, and draw a business plan to start up your own restaurant business.
I am certain that you are unsure of the capital that will be needed to starting up a restaurant business, and how much profit you will expect to make from your restaurant business.
Today, you are going to learn the expert tips on opening up a restaurant business successfully, and to predict how much income you should be expecting to make from it.
With 85% of Nigeria Adults eating out at least once a week, the restaurant business continues to thrive. It is certain that many people will continue to prefer meals prepared outside of the home.
Starting up a restaurant business takes a lot of work, but with expert planning, you can start a successful restaurant business today.
So read on.
How much profit can you expect to make
Do you know that a well run restaurant business typically make between 5% and 8% profit, check on the info-graphic chart below.
That simply means as an average restaurant business owner, after all outside factors are taken into consideration you can be making more than NGN25, 000 daily, and now do the mathematics
NGN 25, 000 x 30 days = NGN750, 000.
So within a year of starting up your own restaurant business, you can actually make half a million, do not be surprised, it is reality. Have you ever seen a successful restaurant business owner that is not wealthy? I guess not.
The major reason why starting up a restaurant business is a success, is because, people can’t do without food. Each and every day, everyone needs to eat (food) to survive, and to acquire energy to do work.
And a single restaurant cannot feed the whole universe; food is a basic necessity of a human life. So, if you are curious about how to start a restaurant business in Nigeria, I have created this guide to assist you come up with a perfect business plan in starting up your own restaurant business.
How to start a restaurant business
Starting up a successful restaurant business requires an expert planning. Before you can go ahead to start up a restaurant business, you must first decide what specific meals you want to provide as service to the public.
Focusing on a specific meal will increase your business reach and customer base. Well, if you are curious about a business plan for starting up a restaurant business, and the cost that will be needed to start. You don’t need to worry, just continue breezing through this article.
Costs of starting up a restaurant business
- Lease and professional fees
- Furniture and Equipment’s
- Staff recruitment
- Initial Foodstuff
- Marketing/Advertising Funds
- Working capital
- Business registration
Lease and Professional Fee
This covers all the expenses for choice of location for your restaurant, lease of commercial space, building, consultant (expert planner) fee and mobility fee. As seen in the infographics above.
This is a crucial aspect when it comes to starting up a restaurant business, because it the location of a business determines how productive and successful it will be.
When choosing a location for your new restaurant, the following should be put into consideration.
• Access to Restaurant – A restaurant that is easily accessible will do better than one that is not easily accessible. Select a spot that is close by to a major roadside, which gets plenty of passerby on foot or in vehicles. In addition, consider to have a parking slot for your customers with cars.
• Market Research – You should ensure that your target market of your restaurant type marches the demographic of the area, i.e. the needs of people in that area.
• Market Competition – A very trendy thing to do is to make sure that there is no nearby competition, so that you can be sure of a large customer base.
• Minimum wages – You should ensure that the labor costs and minimum wages of an area where you choose to start up your restaurant don’t cut into your profits.
Furniture and Equipment’s
This covers all expenses for restaurant equipment’s (like signage, kitchen, furniture, crockery. Etc.). You will need a constant reliable source of quality restaurant equipment’s.
The reason for this is because from time to time there will be need for maintenance, so having a reliable source will tend to cut down expenses. As you will be getting the restaurant equipment at reasonable prizes.
The secret to a successful restaurant business is Hiring the Right Staff. A staff that is willing to treat your restaurant business as his. You should consider all roles empty that is needed to be filled before hiring any staff.
• General Manager
• Executive chef
• Marketing team
• And lot more.
Whichever person you want to employ, look for candidates with prior experience, and a supreme ability to multitask and to work quickly smoothly and efficiently. And ensure that all workers have good social skills, as it is a marketing strategy to drive more customers.
Before you open your restaurant business, you will want to establish some basic food items that your menu will feature. There will be need for expansion of business, but yet, there should be a current menu items.
Well, deciding what will be on your menu is important when figuring out the equipment you need to start up your restaurant business. Don’t be in a haste even if your menu item is not well established unless your whole concept singles out a particular item(s) (like a shawarma place).
However, you should have a solid idea of the fare you will serve at your eatery. Later in the process of opening your restaurant you should engineer your menu to increase profits and continually update your menu as you gain information, and acquire more knowledge of other recipes.
Marketing and advertising is necessary for various reasons. However, I will outline just the 2 main reason to consider marketing and advertising.
• To enable prospective customers find basic information about your business.
• Create urge in customers to try out your new restaurant dishes.
If you don’t tell people about your business, they will not know what it is, and therefore won’t patronize you. That why marketing and advertising is crucial for the success of a restaurant business.
How to market and advertise your Restaurant Business
Are you stuck, when it comes to marketing and advertising your business?
Below are some tips to create awareness around your restaurant.
Use social media – Your restaurant business should be live in social media (like Facebook, Instagram, Pinterest and Twitter etc.), as it’s a new trend to get prospective customers for your business. The photos you upload and descriptions should communicate your brand. Consider branding, and putting up high quality images of food or behind the scenes to attract in potential customers to patronize you. You can employ the service of a social media marker to carry out this task, you could contact me for a perfect social media marketing strategy.
Take a look at the picture below. It an advertisement on Facebook by a restaurant owner. The goal is to get more publicity and more customers through Facebook.
Create A Professional Website. – We in a digital world and if your business is not online then you missing out. Creating a website will enable potential guest to find your restaurant if it listed on Google Map. It increase your restaurant popularity, and makes people want to taste a meal from your restaurant. This is an easy task to carry out, when it comes to creating a perfect website with a reasonable prize then all you need is to contact me to get the job done for you.
Host a Grand Opening and other events – The one strategy to boost your restaurant popularity and to attract more potential customers for your newly lauched restaurant is to host a grand opening, and also create other interesting events around your business location to continue the buzz around your restaurant, it could be a soft party (featuring live music, Comedy, Catering training).
Discount – Giving discount to your customers is an act of showing appreciation for their patronage. At time give first time guess a free drinks or small dessert. The one thing a customer will remember is hospitality, and they more likely to continue buying and referring others to your restaurant.
Are you stun? Don’t be.
Working capital is simply the capital of a business, which is used in its day-to-day trading operations. You should be able to calculate your working capital in every business day.
It represents your restaurant liabilities with its current assets. Having a positive working capital is required to ensure that your restaurant business is able to continue functioning and that it has sufficient funds to operate.
How to calculate working capital
current ratio = current assets / current liabilities
Business name registration
A business that is not registered is not yet a legal entity, and lack right to operate. To open a restaurant you will need to register your business to obtain several federal, state, and local permits and licence to operate as a legal entity.
To avoid embarrassment and discomfort from any source, registering your business is crucial. And CAC (corporate Affairs commission) are the legal body for registration of business/company in Nigeria. It not a big deal, here is a step by step guide on how to register your business with CAC in Nigeria.
In addition, you can consult me to assist you register your business for you with CAC using the contact form below.