Open A Restaurant Checklist

The following is a general checklist for opening a restaurant in California and major cities like Los Angeles, San Francisco, and San Diego. This checklist is not comprehensive because all restaurants are different, but it contains a list of things to remember when opening a restaurant to help guide your planning.

Restaurant Concept

Your restaurant concept will be what makes you unique and should inform all of your business decisions.

Your new restaurant will be one of the following:

• A completely new concept
• A franchise
• An existing restaurant that you purchase
  
  

You will need to create a business plan that deals with:

• Who you have discussed your ideas with (ask them to sign a confidentiality agreement)
• The objectives and strategies for your business
• Your menu
• Proposed pricing of menu items
• Target customers and market analysis
• Staffing needs
• Financial needs to start the business
• The best and worst-case scenarios for profit and sales
  
  

Due Diligence

Due diligence checks will help you to see if your business will be successful. Perform the following checks:

• Survey your target market and see if there is a demand through social media or direct mail
• Purchase prospect lists from the local chamber of commerce
• Do a menu taste test
• Hire a marketing firm to help with market research if necessary
  
  

Your Team

You will need to hire certain professionals to help the opening of your new business go smoothly. Some of the experts you would benefit from are:

• Restaurant consultants
• Accountants
• Lawyers
• Business broker if you are buying an existing restaurant
• Real estate broker
• Designer
• Marketing firm
  
  

Forming Your Business

There are a number of entities you can use for your business, each with its own legal and tax benefits. We will list some of the options below, but you could talk to a lawyer or accountant if you need help.

• Sole proprietorship
• Partnership
• Limited partnership
• LLC
• Corporation
• S-Corporation
  
  

Financing

Raising funds to start a restaurant does not have to be tricky. You can find finances from the following sources:

• Your savings
• Loans from personal connections (be sure to clarify and document the terms
• Small business loans or other loans
• Partners
• Investors
• Purveyor

Make sure you also set up business bank accounts separate from your personal bank accounts. Obtain credit card processing and set up financial reporting.

Choose a Location

Work with a real estate broker to cut down on the legwork to find a premises. Hire an attorney to help lease negotiations or the terms of purchasing an existing business. They will be helpful in negotiating favorable terms like a rent abatement until you open or reduced rent for a share of profits.

Once you have a space, you will need to do the following:

• Engage a pest control service and organize regular inspections
• Connect utilities
• Set up waste management systems
• Obtain building permits
• Check compliance with ADA
• Organize regular elevator inspections
  
  

Supplies and Equipment

If you are setting up a new business rather than purchasing an existing restaurant, then you will need the following:

• Computer
• Phone
• Kitchen equipment
• Reservation software
• Printed material like napkins, signs, letterhead, and takeout bags
• Food and beverage suppliers
• Equipment suppliers
• Product purchasing sheets
• Purchasing manual
  
  

Permits and Licenses

Restaurants need a great number of licenses and permits to ensure the safety of patrons. This is a general list.

• Liquor license
• Employee food handling certification
• Heath code compliance
• EIN
• Certificate of occupancy
• Elevator inspections
• Worker’s Compensation Insurance
• Zoning and building codes
• Wage and hour laws
• Business tax certificate
• Health code compliance
• Building permits
• Fire department permit
• Seller’s permit
  
  

Employees

You will need to take steps to hire staff for your new restaurant. You may consider hiring recruitment specialists to help.

• General manager
• Chef
• Managers
• Supervisors
• Front of House
• Waitstaff
• Dishwashers
  
  

You will also need to complete tasks such as posting job ads and interviewing candidates. Once hired, you will need to train employees and ensure they have the necessary certifications, have manuals and guidebooks and set up payroll. There are a number of laws and regulations around employment, so ensure you hire an attorney to help you navigate these actions.

Insurance

You will need a number of insurances for a restaurant, like:

• Property insurance
• Liquor liability
• General liability
• Workers’ Compensation Insurance
• Unemployment insurance
• Employment practices insurance
• Food contamination insurance
• Loss of business income insurance
• Flood, earthquake, fire insurance
  
  

Trademarks and Other Intellectual Property Protection

Register your trademarks and any other intellectual property with the help of an intellectual property lawyer. This will preserve your competitive advantage.

Marketing and Advertising

Create a marketing plan before you open to create a buzz in your community. Try both physical marketing (flyers, magazine and newspaper ads) and online marketing (social media, email, website etc.).