Things to Remember When Setting up a Food Business
Sep 05, 2019 21:47
Thanks to the rising popularity of the eating out culture, and easier barriers to entry associated with the food and eatery industry, more people are now willing to venture into the food business. New eateries and dining outlets are popping up across the globe now and then. However, as easy it is to start a food business, it important to remember that it's a highly competitive industry and businesses can fail easily. That usually happens when entrepreneurs are negligent towards basic elements of setting up a food business. Here are a few important things that you should pay attention to when starting up an eatery.
Have a Plan
The first thing that any business requires is a business plan. For some odd reason, small scale food entrepreneurs believe that they can do without as proper business plan. That is a major blunder because having a plan will give you a direction and prepare you will about any weak links or potential threats that your business may face. While you are at your planning face, make sure you decide what kind of an eatery are you aiming at. Whether it will be a fine dine or a casual café. What kind of food will it be serving? Will you be having a buffet or an Al a Carte? All these parameters are important to predefine because they will have an impact on your other decisions such as location, equipment, recruitment, etc. Make sure you chalk out a growth plan and set realistic objectives for your business.
Budget and Feasibility
Now that you have your business plan chalked out, it is time to set a budget and allocate to each of your heads that will consume your finances. Remember that some of your heads will take up your costs right away such as fixtures and fittings. Other than that, you will need to set aside some running cash to pay for variable costs such as wages, inventory, etc. Chalk out a financial plan that highlights all you fixed and variable costs and decides how will you source your finances. Ideally, try and rely on your savings as much as possible so that you can save yourself from the interest costs. Instead of parking your entire amount of inexpensive equipment, it would be a better idea to go for leasing.
Your location decision will play a huge role in making or breaking your business. Often amazing eateries end up in failure because of poor location decisions. Although rental costs are an important influencer when deciding on the location, it is also important to factors like your business and your target group.
When you are dealing with something like food you will often find yourself tempted to offer everything from fast food to Chinese to continental. There is nothing wrong in having a diversified menu if you have a stable business with a steady consumer flow. However, for a business that is still in its teething phase, this can be a huge gamble. A large menu also means more chefs and more equipment's. Start with a few items that your chef specializes in and gradually add items to your menu.
Tools and Equipment
Cost-saving is important for a new business however that should not be done at the expense of using subpar equipment. Using a piece of professional equipment is very important to ensure the quality of your food. Many newbies bring in household kitchen equipment which is a huge no. Invest in a proper restaurant kitchen equipment and focus more on quality of equipment rather than quantity.
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