How much capital does it take to open a restaurant? This is a question many people ask when they plan to open a restaurant or invest in similar models. To have an accurate plan, you need to calculate specific costs for each item, estimate risks, and market changes in the near future. Here is all the useful information to help you easily plan costs and use capital effectively.
1. Cost of premises
The cost of space usually accounts for 30% of the budget for opening a restaurant, so this step needs to be done carefully so as not to be “lost” or fall into the situation of “lost money”. The high or low cost of renting space often depends on the area, location, renovating capacity and traffic density, security situation in the area.
Most landlords will require a deposit of 3 to 6 months, so you need to prepare a large amount of money before starting the business. Normally, the average rental cost is 15-30 million/month.
An important note to have a good price, that beautiful location calculates both the available auxiliary works and the items that need to be renovated to negotiate the price with the landlord. For example, if the restaurant has a very narrow kitchen area, no toilet, and a low ceiling, it is advisable to ask for a reduction in the rental price to save part of the cost. The time of consideration and consideration is also based on the “expensiveness” of the premises you are intending to rent.
The cost of premises usually accounts for a large proportion
2. Cost of interior decoration
How much capital does it take to open a restaurant? The cost of interior decoration includes money to buy tables and chairs, wall decorations, stickers, curtains… the items and tools that create the aesthetic of the space.
Because this is an optional step, you should rely on your budget to choose the right restaurant design style. Typically, this cost will account for 5% to 10% of the total capital. Specifically, a few items will have to invest such as:
- Cost of repainting the premises: 15 – 30 million VND (Depending on the size of the restaurant, design style)
- The cost of buying tables and chairs: About 50 million VND for 20 sets of tables and chairs, but if the restaurant follows a luxurious style, tables and chairs are made of high quality wood, this figure can be up to 100 million VND.
- Decoration costs: This cost category depends entirely on your design style. There are restaurants that make use of bowls, pots and pans to decorate and it only costs 5-10 million VND. But there are also restaurants displaying antiques and rare decorations that cost up to 200 million VND.
- The cost of hiring decoration workers: This cost is usually paid to the restaurant interior decoration construction team, the package is about 50 to 100 million VND.
The cost of this decoration depends on the size and style of the restaurant you plan to operate. For restaurants that do not require sophisticated, simple furniture, this cost is not too much padded. For luxury-oriented restaurants, serving the upper class, they require higher requirements for furniture and accompanying decorations. However, regardless of any restaurant model, you should choose the right quality furniture, do not be cheap but choose poor quality to have to change or repair many times.
Planning to hire a restaurant decoration construction
3. Cost of equipment and tools
Equipment and tools in the restaurant such as freezers, dishes, pots and pans, stoves, bars, dispensers, etc. need to be of high quality and durable to save costs in the long run.
Therefore, you need to buy items of big, reputable brands and calculate the quantity carefully, avoiding the case of over-buying, causing waste and additional costs for storage and preservation.
Cost planning for restaurant equipment
3.1.1 Customer service area
These are items that come into direct contact with customers, directly affecting the customer’s experience at the shop, so they need to be chosen carefully. The costs for these items are specifically planned as follows:
- Fan / Air Conditioner: 5 – 10 million VND/piece
- Container for bowls, chopsticks, napkins, spices: 2-3 million VND
- Curtains, foot mats: 3-4 million VND
3.1.2 Kitchen area
The kitchen area is a place that consumes a lot of the investor’s budget because it needs to be equipped with modern electronic devices and specialized cooking tools to speed up sales. Let’s take a look at the basic items for the kitchen area.
- Freezers, refrigerators: 50 – 70 million VND
- Cabinets for dishes, pots and pans: 10 – 20 million VND
- Bowls, pots and pans, cooking utensils: 20 – 30 million VND
- Exhaust and cooling system: 20 million VND
- Gas stove, electric stove: 20 million VND
The total cost for the kitchen alone has come to about 150 million, so before investing, please list all the tools and supplies to buy, quantity, where to buy good prices, from which brand to buy.
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Quality kitchen tools to create delicious dishes
3.2 Restaurant management software
This is an effective tool to help you manage your restaurant effectively but at a low cost. One restaurant management software Full features only cost from 170,000 VND to 250,000 VND/month, stable use, compatible on many devices.
This software has advanced features to help you manage revenue, finance, and materials remotely without having to be on duty at the shop. In addition, customers can also order at the table via QR code or the service staff order via ipad, phone. Order information is automatically sent to the bar and kitchen to save travel time and improve service quality for customers.
4. Material cost
To make a good first impression in the eyes of customers, your restaurant needs to ensure attentive service and the best quality of food. Therefore, do not hesitate to import fresh, high-quality ingredients to serve your god. Only then will they come back and introduce friends and relatives to visit.
Materials don’t last long, so it needs to be calculated accurately
After the first days of opening, the number of visitors will certainly decrease a bit, so it is only then that you can calculate the exact amount of materials to import. Do not plan too specifically for this stage because there will be serious consequences if the actual situation is not as expected.
If yes, then you just need to list in detail the ingredients, spices with good preservation ability, which are mandatory ingredients for dishes such as salt, oil, pepper, onions, garlic, chili…To save money If you want to save costs, you can also import in large quantities to use gradually, instead of buying small pieces which takes time. Usually this cost falls in the range of 10-20 million.
5. Marketing expenses
Marketing costs are often overlooked in the restaurant planning stages because many investors consider this amount to be insignificant. However, you should also list and calculate specific advertising items, flyer printing, banner design, etc., and allocate budget accordingly. Only then will you know which investments are effective and which are not really reasonable.
Calculating Marketing costs also helps you measure the effectiveness of the campaigns you have implemented, thereby converting the strategy with each stage accordingly.
6. Personnel costs
Personnel costs usually include the cost of recruiting, training staff….Many restaurant owners save money by recruiting family members, or posting on social networking sites, free recruitment sites when not. There is a need to hire highly qualified and experienced staff.
Normally, the cost of recruiting and training a waiter is about 1 million VND, while for a chef or chef, it can be up to 3 million VND/person.
Because the characteristics of the chef will be the manager of the processing area staff, allocating work, they need to have good management skills. If your restaurant has a large scale, you should hire specialized training services for employees so that they always maintain a professional demeanor and good attitude when serving customers.
Read more: 11 restaurant business experiences with only success
How much capital does it take to open a restaurant?
7. Other expenses
These are incurred costs associated with the operation of the shop such as electricity, water, cleaning costs, area security… Because this amount depends on the size and operation of the shop, it is difficult to determine. specific at the outset.
To get the most realistic number, you should refer to restaurants and eateries of similar size, usually the total cost incurred a month is about 10-15 million VND.
Read more: How to effectively manage a restaurant to help you double your revenue instantly
According to the experience of many predecessors, the budget required to open a restaurant falls between 500 million and 800 million dong. This is not a small number, so allocate it appropriately. Creating a specific restaurant business plan will help you better control your investments, know which ones are working and which need to be adjusted. The more detailed a budget is, the more effectively you will use your budget. Wish you successful business!