What Expenses You Should Expect Before Grand Opening
Opening a food service business is a huge expense so it is important to prepare for it long before you begin any actual spending. There are many things that you will have to pay for before the day your establishment opens its doors, so creating a budget is the best way to figure out what you will need and how much it will cost.
A budget will ensure that you do not overspend when you purchase the necessary equipment and it will give you guidelines needed as to what type of funding you will require. Even after opening, you will need an annual budget so that you can stay on the right spending track.
Obviously the first thing you will have to be concerned with is paying for the location of your business. Whether you buy an existing building, an empty lot, or rent a space, the funds needed to pay for this must go into your budget. Buildng renovations can also be included in the location part of your budget.
Equipment and Supplies
If you purchase an existing restaurant, it may include much of the equipment that you will need. This could save you quite a lot of money. Otherwise, restaurant equipment and supplies will be a big expenditure. Equipment includes everything from commercial ovens, refrigeration, work tables and sinks, to cookware, cooking utensils, and more.
You will also need to create an appealing atmopshere that matches your restaurant's them. This can include everyting from tables and chairs, to lighting, wall-hangings and more. Decor also includes your table settings, dinnerware and flatware expenses, It may also include your condiment holders, napkin dispensers, caddies, and more. Be sure to include all these costs in your budget under decor expenses.
Licenses and Permits
You will also need to budget in the cost of acquiring all your licenses and permits. You will need to pay for all the inspections required prior to opening your establishment. In addition to these expenses, you may need contractors to repair damages or upgrade your establishment to meet building law codes. These may be unexpected expenses, but if you include them in you budget, you will be covered.
Food and Beverages
Food and beverage costs are a staple budget item for any restaurant. As you establish yourself with vendors, you may have to pay initial upfront costs for your food orders so that you can establish a good credit rating. Needless to say, this expense will remain on your budget throughout the life of your restaurant.
There are also several other start up expenses that will be required, such as computers for keeping business records as well POS systems. Signage, menus, advertising costs and, of course, employee payrolls, must be budgeted as well. You will also need to budget for the unforeseeable things that will inevitably crop up, so it won't harm your business.
Once you create a detailed budget outlining the funds required prior to opening your business, you will be in an excellent position to solicit those funds.