From the start, it will be a well-researched restaurant business plan that will be your single greatest asset. It is the greatest key to convince anyone to make a loan, invest capital, lease, or do any type of business with you. Think of the restaurant business plan as an extremely valuable road map for your restaurant business. Long before you open the doors of your new restaurant, having privy to the best restaurant business ideas and restaurant business information will serve to enlighten you on both the possible pitfalls and various opportunities of the new venture.

Restaurant start ups should incorporate in their business plan such elements as company description, industry analysis, products and related services, the target market, information on the competition, sales and strategy operations, planned management and organizational structure, a long term development plan that includes an exit strategy, and financial data projections.

Many restaurateurs omit these crucial stages when buying a restaurant. They are focused on getting the financing to open the restaurant doors to create cash flow as quickly as possible. Doing the hard work, creating a winning image, great food, and the burning will to succeed are not enough. Proper training will be perennial among the restaurant resources that must be in place. The restaurant business plan must also include well-established operating procedures that will be followed on a religious basis. At any point in time, the winners of any venture are the ones that have the best tools to work with.

Knowledge alone is not power! Power is knowledge applied effectively! You will need to be exposed to up-to-date restaurant business ideas, restaurant business information, complete sample plans and more to stay abreast and competitive in the market. And for both parties, it makes the transactions of buying restaurant and selling a restaurant a lot easier.

Many of the challenges that will face the restaurant owner will be in the area of menu and recipes costs, hiring, illness and complaints, foodborne illnesses, sales breakeven points, operations, employee corrective actions, restaurant maintenance, employee and manager reviews, food cost yields, labor scheduling planning, running inventories, employee time-off requests, scheduled restaurant evaluations, and customer service surveys.

An excellent source of information for your overall restaurant business plan can come from business software. Planning experts, consultants, executives, and CPAs use the Business Plan Pro 2004 PREMIER. The package allows the user to combine several businesses plans to see the big picture and track results more efficiently. You will be able to see advanced financials, sales forecasting, and profit and loss statements far more clear. Another great software tool is the “Restaurant Business Plan Software” that incorporates all the tools necessary for the small business owner to succeed.

Perhaps for the restaurant owner, the best software package available might be the QuickPlan 2003 Restaurant Business Plan software package. This is a complete package that is industry-specific, and covers full service, limited service, fast food, bakeries, caterers, nightclubs, franchises, and expansions with that incorporate a definite them.

These software packages can be great tools for setting up a fantastic business plan that will help you to get funded. All of this may at first seem difficult, but you can rest assured that your competition is privy to such information. The sooner you are on board, the sooner your success will be insured. Knowing your business, your market, and your strengths and weaknesses is just smart business. Remember, it is a sound business plan that will make your dreams of restaurant ownership a reality. And, should you decide to sell a restaurant business in the future, you can serve as a valuable font of information for a potential buyer.

The National Restaurant Association is an excellent industry tool that has the latest information on industry trends and research results. Being part of such an organization encourages networking with others to share information and discover new strategies that will make member’s operations more effective. Some of the group studies include internal auditing, human resources, risk & safety issues, marketing, quality assurance, and nutrition. It is a privilege to have access to leaders in the industry that can offer timely insight on the things that matter the most—as well as help you continually fine tune your restaurant business plan.

In fact, any support group that offers assistance and networking is worth looking into. The immediate gain is access to a constantly expanding array of insights, tools, and resources from fellow independent restaurant operators. You are embarking on a time-honored endeavor of business ownership. How you mentally approach the task will weigh heavily on your chances of success. Right actions only have one consequence: Right results.

If you are looking to become a restaurant owner, you will no doubt spend a lot of waking hours contemplating the mysteries of how to buy a restaurant. You can rest assured there are a lot of great opportunities these days to buy a restaurant. However, with franchises, start-ups, and existing restaurants to choose from, it can be a bit overwhelming to say the least. After reviewing all the possibilities, you may have some tough choices to make. There are going to be challenges with any new business venture, and buying a restaurant will tax all of your business skills. The two most pressing concerns will be growing your restaurant and enticing people to continue to eat there. Your best chances of success may be realized if you buy an existing restaurant business or franchise that is up for resale.

If you decide to buy an existing restaurant business, one of the benefits you will immediately realize is the privilege of examining its historical performance. This will allow you to make some very important business decisions. Your strengths can be of great use even if the restaurant was not profitable in the past, and your greatest hope can be to evolve a winning operation.

Existing Restaurants Are Easier to Investigate

You should always do a thorough investigation of any piece of real estate—and especially if you plan to buy a restaurant. This will require taking an up close and personal look at its past activities, current operations, nearby competition, and its future business potential. Restaurant traffic speaks volumes about what you can expect in the future. It is also important to monitor health trends and how they fit into the current status of the restaurant as well as your ownership goals.

An Infrastructure Already In Place

An infrastructure can best be described as the location, equipment, employees, operating systems, and existing supplies. This removes the challenges of starting out at ground zero when buying a restaurant, and will allow you to focus on building the business—which is where your attention should be. A solid infrastructure already in place also allows you to implement new changes more rapidly. With an existing restaurant, there is quicker opening time versus the time needed if it were a new development. The existing customer base of an existing restaurant can carry the business until you are firmly established, and once firmly established, you can then work on bringing in new customers.

The Benefit of Pricing Differences

There may be the perception that to buy an existing restaurant business, it will cost more. This is not usually the case. The odds are actually in your favor of saving money in the long run when buying a restaurant where all the amenities are firmly in place. Even if purchasing the restaurant requires a premium down payment—you at least know up front what you are getting. Usually with a new franchise, there are demographic studies done on drive by traffic, demographics, and potential customer bases. These are all studies that try to determine the restaurant’s potential for success. In reality, this is a near impossible task. It is also good to note that a new location can take up to a year or more to build. All of these challenges are avoided for the most part when buying a resale location.

Negotiating Flexibility

It is not hard to understand why buying a new restaurant will give you a greater margin to negotiate. Owners are usually selling for a specific reason, and if the price is right, chances are you will have few obstacles standing in your way. Remember, everything from the purchase price to the financing package can be negotiable when buying a restaurant.

Seek the Help Professionals

Regardless of the size of the restaurant business, you should consider using the services of both an accountant and lawyer. The first mistake is to think that with a small restaurant business, you can forego the support of professionals. Accountants and lawyers can be a great defense mechanism in ensuring that you are well aware of any risks involved. Remember though, that the role of the lawyer in purchasing a new restaurant is simply to write the legal terms of what you and the seller agreed upon. Ask the right questions if you plan to buy a restaurant that is for resale. Your goal is to find professionals that will assist—and not simply take your money for drawing up the contracts.

There are two basic motivators that propel us to purchase goods:

1. We need them

2. We want them

Groceries, toothpaste and toilet paper are good examples of items that we need (and most people don’t dispute their necessity). However, most of our purchases aren’t made because we need them. They don’t fit in the first category. We really only need just a few essentials, like clothing to protect our bodies, a basic amount of food to maintain energy, and a shelter to protect us against the elements. In most modern civilizations, we also need reliable transportation vehicle (not necessarily expensive).

These are the items we need to survive in today’s world.

But, the reality is that we spend quite a lot of money buying garments that makes us look good, a big house or a fancy car to impress our friends or gadgets and other accessories that gives us pleasure to use and display. These purchases fall into the second category. They are “wants” not “needs”.

When people come to your restaurant, that visit fits into the second category.

They don’t go to your place because they need to eat. To feed the body, they could eat at home, bring a meal with them, or just buy food at the local convenience store.

Always remember that your clients go to your restaurant looking for an experience, a sensorial experience.

Restaurants play a very important social role in the lives of your clients. They are a gathering place where people go to be surrounded by other people: friends, family, a date, coworkers, etc.

We humans are social animals and enjoy each other’s company, even the company of strangers that we’ve never seen before and probably will never see again.

This is why bars, clubs and restaurants provide such an important social component.

Did this ever happen to you: you’re hungry, looking for a place to eat and there are two restaurants (both you’ve never experienced) near each other? One of them was almost full, with lots of people and action; the other one looked nice, and the menu and prices were reasonable, but it was empty.

Which one would you choose? I guarantee you that 90% of the time; you will choose the busy restaurant (unless you are out with a big party whereby you are bringing the social component with you). You could reasonably assume that the busy place is probably busy for a reason, and perhaps they have better food.

The reality is that people go to restaurants looking forward to having a good time; more than that, they’re looking forward to sharing some good moments with the people they are dining with.

When potential clients walk through your door, they don’t come just to be fed and quench their thirst. They come expecting to have a great time, to share good food, good drinks and good memories with their loved ones, their friends, their families, perhaps their date…

Your job as a restaurant owner is to provide them with that great experience that they so much look forward to and deserve.

Try this exercise: Every time people walk into your place, try to put yourself in their shoes. Try to guess what’s in their minds. Why are they coming to your restaurant? Do they come with friends? Do they come with relatives? With other loved ones?

Each client is different, and has different reasons for coming to your restaurant. If you can’t guess what they are…; just ask them!

Ask your clients if there is a special event that they come to celebrate. Ask them if they have been in your place before (if you don’t recognize them), greet them sincerely, the same way that you’ll greet a friend. Make them feel welcome to your place. Make their experience wonderful right from the beginning.

One word of advice here: Please don’t fake this. If you don’t feel like greeting your clients a particular day, either because you are having a tough day or because you are just tired or not in the mood, then ask somebody else in your staff to do it. People are really good at identifying false feelings and fake smiles. It will backfire on you.

Once your clients feel welcome, they will instinctively think that they made the right choice by coming to your place.

But, what if your place is full? (Hey, it happens sometimes!) If you have this problem, just be honest with them and tell them the truth about the waiting time. I have never gone to a restaurant where I was told that I had to wait around 20 minutes, later realizing that it wasn’t true, and I left pissed after 45 or 50 minutes of waiting.

It is better to apologize to them, tell them that the wait could be up to one hour (or any reasonable estimate based on your experience) and suggest them to go out for a drink and come back (you should have a table for them guaranteed if they are willing to do this), or just give them a business card and politely recommend to them that they make a reservation the next time that they want to come on a busy day.

I can assure you that they will be back; if your place is full and you handle the situation truthfully.

If they decide to stay and wait, offer them a complimentary beverage to make their wait more acceptable.

Once they are seated, don’t wait to offer them something (drinks, bread, a little appetizer, etc.). People often get grumpy when they are hungry or tired (and specially when they are both!).

Check on them once in a while, but not too much. Especially don’t interrupt them if they are engaged in an animated conversation. You and your restaurant are there to make their experience great, not to become the center of their conversation or to stroke your ego by getting compliments from them about you or your place.

Always address quickly and decisively any problem that arises with the food or the service, even if your guests are not right, and you feel that they are complaining unjustly. Think about these guests as your clients, your most important reason for doing business. Your job is to please them and make sure that their experience is the best it can be.

Everybody is unreasonable sometimes. You probably have been, so it’s likely that you will find situations where your clients will be as well. Don’t take it personally.

Think of the benefits of making your clients happy, even at the expense of the profit from their meal. Being understanding and taking quick action will compensate you 100-fold versus having a disgruntled customer that not only won’t come back to your place, but will tell all his friends, family members, their colleagues and – nowadays – thousands of other people giving you bad reviews on many restaurant review places.

A bad review on any of these places can damage your reputation and your place many more times than the cost of the food and drinks, if you refund your guests to make them happy.

Surveys indicate that people make decisions based on other people’s recommendations more than listening to the opinion of experts and pundits. Like it or not, the customers are in control, and the best thing that you can do is to try to have them in your side – not against you.

By losing some upfront money to compensate an unhappy client, you not only win back this client (who may come back to your place) but you’ll also avoid the negative reviews and badmouthing that will cause you many more future losses.

In my detailed Seminar (you can download the modules from www.myrestaurantmarketing.com and review each one out totally free for 30 days before you need to pay a penny), I dedicate the first 3 modules to your clients and why you should change your focus from being cuisine- and chef-centric into a client-centric business. Leave your ego at the door. It won’t pay your bills.

Your clients are the ones who give you the money, your revenue. You can have the best chef in the world, the best food, and the fanciest place; but if you don’t attract clients, make them happy and bring them in over and over, nothing else matters.

However, if you provide your clients with what they are looking for; if you can adapt to serve their needs and their wishes; if you can make their experience in your place memorable; you will become a very successful restaurant businessman.

Your clients will love you unconditionally, and will come back again and again, and recommend your place to everybody they know. I guarantee you.

For more information, and/or to subscribe to this free monthly newsletter, you can check my website Restaurant Marketing Strategies

Please feel free to email me at jose@riescoconsulting.com with any ideas, suggestions or feedback that you have regarding this newsletter.

Happy Sailing!

Jose L. Riesco