Business plan template
Restaurant Business Plan Template
Updated · Team Fonda
Short answer
A restaurant business plan has ten chapters, from the executive summary to risks. It has to prove three things: the concept fits the location, each plate makes money after food and labor, and you have enough cash to get through the slow first months. Use the outline and prompts below to write each chapter.
Key takeaways
- Lenders and landlords read the lease terms, the labor plan and the food cost before anything else.
- Build sales from seats, seat turns and average check, not from a percentage of the local market.
- Cost every menu item from a written recipe before you set a price.
- Plan for cash to cover the months between signing the lease and breaking even.
Who reads a restaurant business plan and what they look for
A restaurant plan usually has four readers, and each one opens it at a different page.
- A lender. A bank or equipment finance company wants to know whether monthly cash flow can cover the loan payment with room to spare. They look at how much of your own money is going in, whether you have run a kitchen or a dining room before, and what the build-out will cost.
- A landlord. A landlord is choosing a tenant for years. They want to see that the concept suits the building and the street, that you can afford the rent in a slow month, and that someone on the team has opened a restaurant before.
- A partner or private investor. They want to know how much they put in, what they own, and when and how money comes back to them.
- You. Writing the plan is the least expensive way to find out that a menu, a rent and a staffing level do not add up. It is far better to learn that on paper than six months into a lease.
Restaurants carry heavy fixed costs: rent, a kitchen that has to be staffed whether or not the room is full, and ingredients that spoil. That is why every reader wants the same thing from you, which is honest arithmetic on seats, checks, food and labor.
The 10-chapter restaurant business plan outline
Write the chapters in this order, but write the executive summary last. Each row says what belongs in the chapter for a restaurant and the questions your reader expects you to answer.
| Chapter | What to write for a restaurant | Questions to answer |
|---|---|---|
| 1. Executive Summary | One page: the concept, the address or target area, the number of seats, the opening date, the money you need and what it pays for. | What kind of restaurant is it, in one sentence? How much are you asking for and how much are you putting in yourself? When does the plan say you break even? |
| 2. Problem & Opportunity | The gap in this neighborhood. Maybe office workers have no sit-down lunch within a short walk, or families have no mid-priced dinner option. | Who is underserved today, and at which meal? What do they do instead right now? How do you know, beyond your own opinion? |
| 3. Solution & Product | The concept, the service style (counter, casual, full service), a sample menu with prices, and the drinks program. | Which five dishes will carry most of your sales? What does a typical guest order and spend? Will you offer takeout, delivery or catering? |
| 4. Market Analysis | The trade area: who lives and works within a realistic travel distance, foot and car traffic at the site, parking, and how busy the area is by day and by season. | How many people pass the door at lunch and at dinner? What do nearby residents and workers spend on eating out? Is the area growing or emptying? |
| 5. Competition & Differentiation | Every place a guest might choose instead, including delivery apps and the grocery store hot counter, with their prices and busy times. | Which three restaurants are closest in price and occasion? Why would a regular of theirs try you? What can they not copy quickly? |
| 6. Business Model | How money comes in: dine-in by meal period, takeout, delivery, catering, private events, alcohol. Show seats, seat turns and average check for each. | How many guests do you serve on a slow Tuesday and a busy Saturday? What share of sales comes from drinks? What do delivery platforms charge you? |
| 7. Operations & Technology | The lease, the kitchen layout, suppliers, opening hours, the point-of-sale and reservation systems, and food safety routines. | What are the lease length, the rent and any rent increases? Who are your main suppliers and how often do they deliver? Which licences and inspections do you need before opening? |
| 8. Team & Organization | Owners and their restaurant experience, the head chef and general manager, the staffing schedule for each shift, and how you will hire and train. | Who has run a kitchen or a floor before? How many people work a weekday lunch and a Saturday dinner? What happens if the chef leaves? |
| 9. Financial Plan | Startup costs, a month-by-month profit and loss forecast for at least the first year, a cash flow forecast, and a break-even calculation. | What does it cost to open the doors? How many guests per day do you need to cover costs? How many months of losses can your cash absorb? |
| 10. Risks & Mitigation | The things most likely to hurt you: build-out delays, ingredient price rises, staff turnover, a bad inspection, a slow first winter. | Which risk would close you fastest? What will you do in the first week it shows up? What does the plan look like if sales come in a third lower? |
Fonda's business plan uses this same 10-chapter structure and cites its sources, so you can read an example plan there to see how a finished chapter looks.
The key numbers a restaurant plan needs
These are the figures a lender will look for. Calculate each one from your own menu, quotes and lease. Do not copy a percentage from a blog post, because the right figure depends on your concept, your city and your rent.
| Number | How to calculate it | Why the reader cares |
|---|---|---|
| Covers per day | Seats x seat turns per meal period, added up across meal periods. A seat turn is how many times one seat is used during a service. | It is the ceiling on your sales. A plan cannot sell more meals than the room can hold. |
| Average check | Total food and drink sales / number of guests served. | Covers x average check is your sales forecast. |
| Food cost percentage | Cost of ingredients used / food sales. Work it out per dish from a written recipe, then for the whole menu. | It shows whether menu prices leave enough to pay for everything else. |
| Labor cost percentage | Wages, payroll taxes and benefits for all staff, including managers / total sales. | Labor is a cost you set every week through the schedule, so readers check it closely. |
| Prime cost | Cost of food and drink sold + total labor cost. Divide by total sales for the percentage. | It combines the two biggest costs in one figure that is easy to track weekly. |
| Occupancy cost percentage | Rent + property charges + building insurance / total sales. | It tells a landlord and a lender whether the site is affordable at the sales you forecast. |
| Break-even sales | Fixed monthly costs / (1 - variable costs as a share of sales). | It is the sales level where you stop losing money. See break-even point. |
| Opening cash need | Build-out + equipment + deposits + licences + opening stock + pre-opening wages + the losses you forecast until break-even. | It is the amount you actually have to raise, which is more than the cost of the build. |
Run your fixed and variable costs through the break-even calculator, and list every opening expense in the startup cost calculator so nothing is left out of the amount you ask for.
Example chapter: Business Model for an imaginary restaurant
This is an illustration
Saffron Table is an imaginary 40-seat casual Indian restaurant. Every number below is made up to show the method. Replace them with your own.
Revenue streams. Saffron Table earns money from dinner six nights a week, lunch five days a week and takeout orders placed by phone and through our own website. We do not plan to use delivery platforms in year one.
Dinner. We expect each of the 40 seats to be used 1.5 times on an average night, which is 60 guests. At an average check of $32, that is $1,920 a night and $11,520 a week.
Lunch. Lunch is quieter. We plan for 0.8 seat turns, or 32 guests, at an average check of $16. That is $512 a day and $2,560 a week.
Takeout. We plan for 20 takeout orders a night at $28 each, which is $560 a night and $3,360 a week.
Weekly total. $11,520 + $2,560 + $3,360 = $17,440. Our best-selling dish, butter chicken, costs $5.10 in ingredients and sells for $18, a food cost of about 28 percent on that plate. The Financial Plan chapter shows the same calculation for every item on the menu.
Notice what the example does. It builds sales from seats and checks, it separates meal periods, and it shows the sum, so a reader can change one assumption and see the effect.
Mistakes that sink restaurant business plans
- Forecasting a full room from day one. Plan a ramp. Show a slow opening quarter and say what you will do to fill midweek services.
- Pricing the menu by looking at competitors only. Their rent and portions are not yours. Cost each recipe, then check the price against the street. The markup calculator helps here.
- Leaving out the months before opening. Rent, wages for training and deposits all fall due before the first guest pays. Put them in the cash flow forecast.
- Signing a lease the forecast cannot carry. Work out occupancy cost against a cautious sales figure, not your best month.
- Skipping the people. A plan with no named chef or manager, and no schedule showing who works each shift, reads as a plan written by someone who has not worked in a restaurant.
- Not asking anyone. Before you sign, talk to people who live and work nearby about where they eat and what they pay. Our guide on how to validate a startup idea shows how to run those conversations.
Frequently asked questions
How long should a restaurant business plan be?
Long enough to answer a lender's questions and no longer. There is no required page count. Give each of the ten chapters one to three pages, then put the menu, floor plan, lease summary and detailed financial tables in an appendix. A short, clear plan is better than a padded one.
Can I write a restaurant business plan before I have a location?
Yes. Write it for a target area and a realistic rent range, and state those assumptions. Then update the market, operations and financial chapters as soon as you have a specific site and lease terms, because the site changes most of the numbers.
Do I need a business plan if I am not borrowing money?
You still need the numbers. Even if nobody else reads it, the plan tells you how many guests you need each day, what you can afford in rent and how much cash to keep in reserve. A landlord may also ask for one.
Which licences should the plan mention?
List every permit your city, county and state require before opening, which may include food service, health inspection and alcohol permits. The rules, fees and waiting times differ by place, so ask your local health department and licensing office and put their timelines in the plan.