How to open a restaurant in India

How to open a restaurant in India, how to start a restaurant business in India, how to start a restaurant in India, best place to open a restaurant in India

In today’s post, I will tell you how to open a restaurant in India.

Although running a restaurant requires long hours of work, the restaurant business remains one of the favorite businesses of entrepreneurs. That is to say, if the idea of ​​starting a food business comes into the mind of a person. 

Apart from this, as we all know that many people are connected with the areas of hotels and restaurants. Therefore, after a time, even those people have a desire to start their own business. So they think of starting a new restaurant or dhaba business. If you also want to open a new restaurant business, then this post is for you.

I will tell you how to open a hotel and what things you have to pay attention to, to get successful in this business. Let’s dive into our topic now: How to open a restaurant business in India.

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How to open a Restaurant in India

Restaurant Industry in India

According to research, the restaurant industry of India is one of the fastest growing industries in the world, and the food industry in India in 2018 was around 23000 crores. At present, it must have increased even more, the main reason for the growth of the restaurant industry is the change in the lifestyle of the people, the substantial increase in the wages of people, growth of the economy, the increase in the workforce, etc. 

Also, people have started to like restaurant food as they find an escape from their stressful lives. 

Because usually husband and wife are working in the house and after coming from duty, they rarely feel like cooking. So it is natural to go out for dinner or order food from a restaurant. Even in households where both husband and wife do not work, they want to eat out once a week. 

And in urban areas especially Tier 1 cities and tourist destinations, Restaurant Business makes you filthy rich. Because compared to other cities, there are more customers who spend money and are fond of food.

How to start a Restaurant business in India

First thing that any business needs for a good start is some money. The same is for starting a restaurant business, but even if the entrepreneur has money, he still needs a lot of hard work and management to start such a business.

The significance of this statement is that funding is required for almost all businesses, but the most significant factor in starting a firm is the entrepreneur’s expertise and understanding of working in that industry. Be able to handle the difficulties that come and maintain your composure even in the most difficult situations. Any person who wants to open his own restaurant can follow the following points mentioned by us.

1. Type of Restaurant 

As we all are well aware that at present there are many types of restaurant business. That is to say, restaurants can be divided into many categories. These mainly include fine dining, restaurant bars, quick service restaurants, cafes etc. Therefore, the first step of an entrepreneur towards starting a restaurant business is to decide what type of restaurant he wants to open.

The entrepreneur must also determine how much funding he can create for his business, i.e. how much money he intends to put in his business. Because the amount of investment will help the entrepreneur determine which style of restaurant to operate.

When the entrepreneur has made this decision, he must create his business strategy, which must be in writing. This should encompass the restaurant’s theme, interior design, investment, and long-term planning.

2. Cost of opening a restaurant

Figuring the amount of investment needed is crucial for the business because only after assessing it, the entrepreneur will be able to do fund planning and planning ahead. So it is important to note here that the entrepreneur may need to estimate the following costs for opening a restaurant.

Food cost

Food cost in restaurant business refers to the cost that the entrepreneur needs to spend in buying raw materials like flour, pulses, rice, spices, meat etc. According to one figure, the food cost involved in making a dish is 30-40% of the total cost of that dish. However, the entrepreneur must still evaluate it in light of his plans. Because the labor cost, for example, must be calculated.

Fixed costs or overhead

• Fixed costs, sometimes known as overheads, are expenses that are distinct from raw material or labor costs. These include the following expenses.
• These include restaurant prices, which may vary depending on location and city. But an ideal fare should not exceed 10% of the total revenue of the restaurant.
• The interior of the restaurant can be decided by the entrepreneur based on the type of business and the theme of the restaurant.
• Investing in restaurant cooking equipment can help an entrepreneur’s bottom line. But since most of the equipment is made of stainless steel, they cost more, but they also last longer. So they recover their cost in the long run.
• A person will also need to get many licenses for restaurant business. However, the license fee etc. will depend on the type of business under which business entity the entrepreneur registers his business.
• Marketing is also necessary for business. According to one figure, the entrepreneur running a restaurant needs to spend about 1-2% of his total earnings in marketing.

Since presently the billing and payment process should also be easy. Therefore these expenses should also be included in the final say.

Also Read: How to start a hotel business in India?

3. Manage fund

Many restaurant enterprises fail because the investment required is more than the entrepreneur’s capacity to open them. The meaning of the saying is that due to lack of funds, many entrepreneurs are not able to fulfill their dream of opening a restaurant. Hence investment is a very important factor for opening a restaurant.

Depending on the type of restaurant, the entrepreneur needs to manage the cost of opening his restaurant. When the entrepreneur has the figure of investment to be taken, he can adopt the following methods to raise funds.

If the entrepreneur has money equal to or more than the cost of starting a restaurant business in his bank. So the first difficulty faced by the entrepreneur in opening a restaurant is almost gone. However, to reduce the risk, the entrepreneur can start this business in partnership also if he wants.

If the entrepreneur does not have a sufficient amount of money in the bank then he can apply for a loan from the bank. However, the entrepreneur may face a lot of trouble in taking a loan from the bank. Because for giving loans, banks are looking for some property or jewelry in the mortgage or some person who takes responsibility for that loan.

In the beginning it is difficult to make people  invest in your business, therefore you’ll have to come up with an effective strategy that’ll make them trust you. As a result, you can seek Capital Venture or Angel Investor.

4. Select Location For Your Restaurant

When discussing beginning a restaurant business, it is critical to discuss its location as well. This is due to the fact that the location often has a big role in the success or failure of this sort of organization. When an entrepreneur selects a place for his business, it is critical to first examine the competition in that area, as well as assess the competitor’s progress and comprehend their business model.

Competition should be evaluated not only in the cuisine, but also what type of food the competitors of the entrepreneur are providing to their customers like fine dining, casual food etc.

It will help to understand things like their spending capacity, preferences, favorite food etc. Keep in mind that for restaurant business, it is very important to choose a location where customers can easily see and reach.

Generally the ground floor is suitable for the restaurant. That is because the restaurants which are not available on the roadside or on the ground floor, customers find it difficult to find them. Apart from this, the location should be such where the neighbors or neighbors of the entrepreneur do not hesitate to give him no objection certificate. Because it may be necessary to start this type of business.

5. Get License and Permission for Restaurant Business

Entrepreneurs may need to obtain a license from the government to start a restaurant business in India. However, for obtaining these licenses, the entrepreneur may need to pay different fees depending on the enterprise. Acquisition of the following licenses may be required in starting such a business.

• There may be a need to take a trade license from the municipal authority, whose fee is 5000 to ten thousand rupees which is renewed every year.
• Apart from this, the entrepreneur also needs to get a food license from the Food Safety Authority, which the entrepreneur can also apply online.
• GST registration is also required, and it is simple to apply online.
• To deduct taxes from his employees, the entrepreneur may also require a TAN and a Professional Tax License.
• If the entrepreneur wants to set up a bar or other amenities in his restaurant, he will also need a liquor license. Because it takes some time to obtain, the entrepreneur should apply for it as soon as possible.
• In the form of business registration, the entrepreneur can register his business under proprietorship, partnership etc. In addition, if the entrepreneur so desires, he can register his firm with Udyog Aadhaar. Apart from this, fire safety licenses and pollution licenses may also be required in many states.

Also Read: Earn 300 Rs per day online

6. Hire Employees

Hiring the right talent and retaining them for a long time is a huge challenge in this restaurant business. If you hire employees under a referral, it is also a good idea because people mention their relatives, relatives and family members in this.

However, in the initial phase, the entrepreneur can recruit the employees through traditional methods only. The entrepreneur can do this by advertising in the local newspaper and inviting candidates for interviews. In addition, the entrepreneur can contact prospects for interviews by advertising on Facebook and LinkedIn. The entrepreneur primarily needs three sorts of workers for the restaurant business, which are as follows.

• In the kitchen staff the entrepreneur may need cooks, food preparation staff, support staff and unskilled labor.
• Waiters, housekeeping employees, bus boys, and other service staff members are required to communicate with consumers. So they should be able to communicate adequately. 
• Management personnel include the restaurant manager, safe, cashier, store manager, and other employees who are responsible for overall management. That’s why you should choose qualified and educated people for these jobs.

7. Design Menu for Restaurant Business

Designing a menu for a restaurant business is also a critical undertaking because the entrepreneur must consider numerous factors. The menu should include goods that the entrepreneur can promptly supply to clients and supplies that are always easily available.

Entrepreneurs should focus on menu items made from ingredients that are liked by the customers and also generate less waste. That is, most of them can be used. The menu should be designed in such a way as to encourage the entrepreneur to spend more. The entrepreneur might seek the assistance of a professional for this purpose.

8. Look for Vendors and Suppliers

A robust working connection with vendors and suppliers is critical for the effective implementation of a restaurant business. Each category should contain at least two to three vendors for the entrepreneur. If the entrepreneur has two or three vendors in the same category, he will be able to perform a pricing comparison, and if one fails, he may use the other as a backup.

To deal with emergency situations, it is absolutely necessary for the entrepreneur to have at least two days’ stock. Items from store room to kitchen etc. should be distributed every morning and stock should be assessed. 

However, it is preferable to engage into a long-term deal with the seller because it protects the entrepreneur from price fluctuations. However, he should check the statutory documents and trade identity number of the entrepreneur with whom he is entering into this transaction.

Although, as can be seen, successfully running a restaurant is a difficult undertaking. But still the idea of ​​starting a restaurant business in India is an excellent idea.

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Conclusion

I hope that you have understood How to start a restaurant business in India, How to open a Restaurant.

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Today we learnt-

• How to open a restaurant in India
• How to start a restaurant business in India
• How to start a restaurant in India
• Best place to open a restaurant in India

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