We have already talked about what type of restaurant to open, so given those parameters what should you look for when searching for a restaurant space?  There are three main options, lease a former restaurant, buy an existing restaurant and finally, build out a non-restaurant space.

If you are reading this blog then I am guessing that you don’t have millions to build out a new space.  It will be hard to maximize your profit if you have to start from scratch.  It will take years or decades to make back your initial investment.  We don’t recommend this option for the type of restaurant that we suggest.  There are more than enough former and existing businesses around that will save the majority of build out costs.

Whether buying a business or just leasing out a former restaurant space, there are many items to look for in a space.  The better the restaurant space is setup already, the cheaper the opening cost will be, and the more profits you will make long term.

Front of house space and build out

Lets start by looking at front of house considerations.  The front of house is broken into two main parts, the dining room and counter space and area behind of the counter.  A space where your dining room can have a minimum of 6 tables each with 4 seats, up to a maximum of maybe 10 or 12 tables.  Remember you want to keep the square footage and overhead low.  

Two top tables work great as you can push them together for dinner and larger groups, then for lunch it is possible to set the dining room up as 2 tops as the diners will most likely be solo or pairs.  These will also allow for building 6 tops easily without totally losing another 4 tops.  This will allow for the best optimization of the space.  Counter style seating if the restaurant space has room can fit several guests in a small area, it also provides a great place for people to wait when ordering takeout.

Tables and chairs

The dining room should be cohesive with new matching chairs and tables.  It is worth spending some money to make the dining room as professional as possible.  Commercial table and chairs can be inexpensive if you do a little searching.  Don’t fall in love with those fancy $200 boutique chairs and tables, $40 a chair should do it.  Dark colors work well with most styles and will hide wear well.

The dining room should get a fresh coat of paint before and after you open.   It is imperative to make people feel comfortable and a nice clean space will do that.   Make sure the color of paint matches your theme and add some nice artwork or decor items that also match your theme.   Avoid cheap plastic items, really put some work into designing the dining room.  Get creative but keep it tasteful.  Avoid promotional items from suppliers, maybe one if you are promoting beer sales.

Menu

A menu board is an obvious must.  Try to avoid the standard type and do something different.  A large chalk board can work if you have an artist friend who can come in to add the menu items.   A large TV can work, the prices are plummeting an an 80 inch TV can make a great menu.  All that is needed is the menu design in picture form and a casting app on an inexpensive tablet.  Bonus: that tablet can play your music and show online orders.

Make sure the ceiling is nice whether it is ceiling tiles or just open, get it cleaned and painted and keep up with it.  Check the ceiling tiles for water damage which can be signs of a leaky roof and make sure the landlord will address it.  Replacing a tile floor can be very expensive so try to find a space where the dining room floor is decent.  Wood is good and can be refinished inexpensively if needed.  Avoid a carpet floor like the plague, they are wear badly, can be stained easily and can harbor nasty smells.  If a potential restaurant space has carpet take a peak underneath, hopefully there is wood, or even concrete which can be refinished stylishly these days.

You will want rugs for the high traffic / walk ways and should be vacuumed at night and during the day when necessary. Get a rug service like Cintas so you can get new ones each week (they can also provide aprons, dish towels and other items). Do your homework with these services, many will only offer long term contracts, try to avoid that and at least get a trial period.

POS

Moving behind the counter you will need a place for the customers to order, and I strongly recommend getting a POS (point of sale) system.  Be sure to do your homework there are many players in this market some good some bad and some horrible.  Look for another lengthy post soon on these systems.

There will need to be some space behind the counter for dining room supplies, plastic silver ware, napkin, garbage bags, straws, etc.  Also, behind the counter you will need a beverage cooler of some kind.  We don’t really suggest going with a soda fountain as it takes up a lot of room and limits what you can offer, plus you can deliver it.  If you have the room you may want to price it out, but there really isn't much difference when you factor all the costs.  

Beverage

You can usually get a cooler at no cost to you through your local or national beverage distributor.  They are usually happy to give you one (really just borrowing it).  Some conditions might apply so you may only be able to put their product in the machine.  Just check with multiple providers and see what they will offer.

Handicap access is important and may be mandatory in your area.  If the space doesn't already have easy access entrance, make sure it can easily be upgraded to allow handicap access.  Restrooms will be necessary, try to find a space with at least two, one for customers and one for staff. Having separate men's and women’s for customers is great if you can find it.  You will most likely have to deal with what your space allows, because adding restrooms can be expensive.

A good rule of thumb is to have about 40% of the space for counter room and dining room.  The kitchen and storage should be around 60% of the space.

Back of house space and build out

The layout of your space is going to be very different depending on your exact situation, so let's talk about some general ideas to help.  We already talked about the FOH where you will have a dining room and a counter area.  Hopefully the space will allow for the counter space to be in between your dining room and kitchen.  The kitchen can be walled off with a pass-through window or it can be open.

The kitchen will be anchored by your hood unit.  Finding a space that has a hood unit already with fire suppression system will be paramount. It is very costly to install one from scratch and most likely outside the affordability of this project, unless you are well financed.  10 or 12 feet of hood space should be sufficient to hold the necessary equipment.  Existing hoods can be extended to handle pizza ovens or other equipment easily.

HVAC

Make sure to test the HVAC system. Make sure the AC works and the heat works WITH the hood unit on. Look for some divider between the kitchen and front of house.  You need to vent the cooking fumes AND keep the customers conformable.  The hood unit can suck all the air-conditioning or heat out of a restaurant in a few seconds if there isn't a good divider and/ or proper make up air.  If the space doesn't have adequate makeup air you may have to crack the back door or a window to keep the hood unit from pulling all the heat or air from the dining room.

The main line should be across from your hood unit with a sandwich unit, pizza station and frozen food freezer right across from the hood.  If the space is large enough put some prep tables behind the main line and put your main refrigeration behind that to create your secondary line.  The second Holy Grail after an existing hood would be a walk-in cooler and / or freezer.  Walk-ins are very expensive to install, but not might not be 100% necessary.  It is likely that reach in fridges and freezers will be sufficient if the space doesn't have the walk-ins already.  Just keep an eye out for spaces with them.

Plumbing

The space will need a dish station, which may be set in stone depending on the plumbing situation.  Be sure to locate the plumbing and how it fits in to the kitchen layout.  The plumbing can be moved and added, but it may cost thousands.   Run the hot water for a long time to get an idea on the condition and size of the hot water tank.  Make sure it will be sufficient.   Check for a grease trap, they will most likely be required locally.  They can be expensive to install if the layout is not right.

Bringing in an electrician to run some new outlets may be necessary but can be affordable.   Try to find a friend or try trading food.  Opening a trade account for handymen or tradesmen can save a bunch of money.  They are often out on the road and need to get lunch.

Office

Keep an eye out for a space that can be an office, maybe the space will have a dedicated office, or a nook that can be used for one.  All that is really needed is a little space for a locking file cabinet and computer.  There should be a utility closet, and hopefully it has a mop sink, or you may have to put one in.  Check with the health department because the mop sink may be required.

The restaurant space will need a private place for a safe.  Maybe in a closet or in the basement, preferably somewhere where you can lock it up out of view.  A safe with a drop slot works great so your employees can make drops without having the combination.

The restaurant space is going to need three dumpsters, garbage, cardboard, and grease. Make sure the outdoor space has room for all three and there is a decent way to conceal them if they are not out of sight.  Hopefully these spaces already exist.

Visibility

A good restaurant space will have visibility from the street and or a nice sign on the street.  Make sure it has easy access from the road and a good number of parking spaces.  Five would be the absolute minimum and hopefully there are a few on the street or in other lots for overflow nearby.   Decent street appeal is a plus but not necessary.  Most pizza shops are in strip malls, so the public will accept it.  If you can find something unique that fits the other requirements, jump on it!  Make sure you can mold the location to fit with your theme.

The fact is there is no perfect location and if you wait for it you will never open your shop.  There may not be many options where you are, so you are just going to have to settle and make it happen.  The demographics of the area are more important than a perfect restaurant space so make sure to weight each factor appropriately.  A great area with a bad space is much better than a great space in a bad area.  Just choose a space in a good to great area with the least out of pocket costs.

If you have a space in mind, or would like some more details about the description above, consider a Restaurant Coaching membership!  We can guide you through a space finding decision.

The post What to look for in a Restaurant Space appeared first on Restaurant Coaching Online.

There are plenty of people sitting at home wondering how it went bad.  How did this venture fail?  80% of restaurants fail in three years.  To beat the odds, you must be strategic in planning BEFORE you open your business.  The specific type of restaurant to open to maximize your chance of making a comfortable living working for yourself, is the fast casual restaurant.  A simple counter service fast casual type of restaurant with a small foot print and low overhead.  The trends are clear that this type of restaurant is thriving today.

The dream

It may be tempting to open your grand vision, spend hundreds of thousands of dollars in a 10,000-square foot space, totally renovated to your exact specifications.  This type of restaurant will need dozens of staff and managers, and you will have to run the bar until 2am every night.  Every restaurateur has had the grand the vision but to make sure you are one of the 20% that survive, is to learn how to tame the vision.  It needs to be trimmed down it in the right places.  The vision can survive through the overall theme and personal drive.

OK, so I just killed your dream and maybe you feel like there is no pride in operating a small fast casual type of restaurant.  You must look at what business ownership means to you.  Are you in business just to say that you are in business?  Will you only feel pride if you execute your grand vision business?  You should have the pride of operating a PROFITABLE business.  Maybe it isn't some large sports bar or fine dining fancy sit-down, but you will make money.

You will make money and you can do it in 40 hours a week (And with good planning maybe even less).  Maybe not at first as the startup will consume many days and nights, but done right you will have more free time than any of those fancy business owners.  You will be able to take great pride knowing you are making a good living for you and your family while also having the time to spend with them.

What type of food

The original fast casual restaurant is the pizza joint.  They proliferate every corner of America, and have survived for decades because it can be very profitable.  Chinese food has also successfully spread across the country in the take-out and delivery format.  Chances are right now where ever you are you can order pizza and Chinese food from multiple restaurants.  Keeping a small footprint combined with low labor needs create the perfect environment for profitability. 

Don't think you have to do pizza or Chinese to be successful in fast casual.  Almost any style of food can fit the fast casual type of restaurant. 

• Sandwich
• Burger
• Barbecue
• Wings
• Taco
• Burrito
• Waffle
• Asian
• Salads

Major chains like Chipotle Mexican Grill, Boston Market and Panera Bread have been fast casual from the start.  Fine dining groups have launched new chains like Shake Shack, and more fine dinning chefs are getting into the game.  It is hard to know if the market is following the consumer trend or the consumers are embracing the market trend.  What ever direction it is, the trend is clear that more people are eating at fast casual restaurants.

What does this mean for an restaurateur

The fast casual trend is great for the aspiring restaurateur as it allows for the creation of a business with low opening and operating costs.  The reason these type of restaurants are so popular from the business side is the relatively low cost and higher margins.  The fact that the consumer is embracing the concept is fantastic.  This opens up the space of opportunities for a restaurateur.   Strip malls, office building cafes and old pizza joints are all on the table now.  You don't have to build out a million dollar stand alone restaurant to be successful.  The fast casual restaurant, done right, can actually be cheaper and easier to operate than a food truck!  The sales to investment ratio will be very high.

Restaurant size

Size is money.  Costs will scale exponentially with square footage.  One of the best facets of a fast casual restaurant is is small size.  Opening a small fast casual type of restaurant will only need around 1500 to 2000 square feet and maybe even smaller if it is setup properly.  Benefits to a smaller space include:

• Lower rent
• Lower utilities
• Less staff and lower labor costs
• Less equipment and repair
• Lower maintenance costs

Location

A fast casual restaurant has the advantage of being able to fit in almost any type of space.  Because turnover at restaurants is high, there are many opportunities with previous shops.  Finding a space that was a restaurant before can save tens of thousands of dollars in start up.  Building a kitchen from scratch is quite costly.  Just remodeling one and adding a few pieces of equipment is a great way for restaurateurs to minimize your startup capital.  You may be surprised what is out there, you may be able to rent a fully equipped restaurant with a little premium in rent.  Landlords may offer rent to own on the equipment which is great to reduce your out of pocket costs.

Menu

Fast casual restaurants have simple but well-rounded menus typically adhering to a theme.  A small focused menu utilizing ingredients well will help to minimize food costs.  Many sit down restaurant have been killed by having a large unmanageable menu.  Simply being a fast casual restaurant necessitates a very optimized menu, which will lower food costs and drive up margins.  These menus can be executed very fast during peak hours, maximizing sales.  Fast casual restaurants have the speed and convenience of fast food while providing much better food to the customer.  Catering can be added to provide revenue without using front of house square footage, an advantage most fast food places can't do.

Labor

Labor costs are rising around the country and may in fact be driving some of the popularity from restaurateurs of fast casual.  The small menu helps reduce the prep and cooking costs, while the counter service alleviates the need for a swarm of servers.  Minimum wage hikes are a reality and restaurants are finding ways to cope with the added cost.  Full scale restaurants will have to raise prices to make up the difference or risk over working employees.  The fast casual restaurant is already optimized on labor, only needing what is absolutely necessary.  

Summary

Fast casual is clearly the type of restaurant that can deliver minimized costs and maximized profit.  Startup cost can be very small and operating cost can be very manageable.  Labor and food costs are as minimal as can be done, outside of fast food.  A good fast casual restaurant can provide a very good living for an aspiring restaurateur.

Our experts have opened fast casual restaurants and are here to help!  If you are thinking about opening this type of restaurant in the future or finding it hard to keep one profitable, consider a Restaurant Coaching membership! 

The post What Type of Restaurant Should You Open? appeared first on Restaurant Coaching Online.