Running a Restaurant For Dummies

Michael Garvey is the former general manager of Grand Central Oyster Bar. He is currently a restaurant specialist for Vision Wine Brands. Heather Dismore is a professional writer who has extensive experience in the restaurant business. Andrew G. Dismore is an award-winning professional chef.

• Introduction 1About This Book 1Conventions Used in This Book 2What You’re Not to Read 2Foolish Assumptions 3How This Book is Organized 3Part 1: Getting Started 3Part 2: Putting Your Plan in Motion 3Part 3: Preparing to Open the Doors 4Part 4: Keeping Your Restaurant Running Smoothly 4Part 5: The Part of Tens 4Icons Used in This Book 4Beyond the Book 5Where to Go from Here 5Part 1: Getting Started 7Chapter 1: Grasping the Basics of the Restaurant Business 9Getting a Feel for the Restaurant World 10Laying the foundation 10Setting up shop (with a little help) 11Welcoming the world to your restaurant 11Finding Out Whether You Have What it Takes 12Monitoring your motivations 12Evaluating your expectations 13Tracking key traits of successful restaurateurs 14Chapter 2: Deciding What Kind of Restaurant to Run 17Figuring Out Where to Start 18Buying into a franchise 18Taking over an existing restaurant 19Partnering up with your current employer 20Starting from scratch 21Choosing the Right Type of Restaurant 22Dining in style 22Kicking back casual 24Placing an order — to go! 24Selecting self-service or fast-food 26Running a bar — with or without food 27Providing catering and banquet services 27Creating Your Concept 29Positioning your restaurant for success 30Identifying the emotional connection 31Creating a unique selling proposition 31Using consumer insights to develop and test your concept 32Developing your positioning statement 33Putting it All Together 34Thinking about theme and concept 34Choosing a name 35Creating a logo 37Signing off on signage 38Chapter 3: Researching the Marketplace 41Getting Your Mind Right: Profits Matter 42Exploring the Consumer’s Buying Decision: The Big Why 42Identifying and Analyzing Potential Customers 44Figuring out who your customers are: Target segmentation 44Creating a profile of your Superfan, or brand hero 45Focusing your research 47Keeping an Eye on the Enemy 48Identifying your competitors 48Figuring out who they think their customers are 49Reconnaissance: Mystery shopping till you drop 50Developing and Implementing Your Battle Plan 52Doing a competitive analysis 52Acting on your information 54Adjusting to a changing battlefield 55Chapter 4: Writing a Business Plan 57Don’t Fly Blind: Understanding Why a Business Plan Matters 58Laying Out a Business Plan 59Articulating the concept and theme 61Creating your menu now 61Analyzing your market 62Identifying your target audience 63The Bottom Line: Focusing on Financials 63Forecasting sales 64Forecasting expenses 67Breaking even 72Estimating profits 73Projecting cash flow 74Creating a balance sheet 74Selling Your Plan: The Unwritten Part of Your Business Plan 76Part 2: Putting Your Plan in Motion 77Chapter 5: Show Me the Money! Finding Financing 79Knowing How Much Money You Need 79Calculating start-up costs 80Opening with operating reserve 81Looking at How You Can Contribute 81Working with Investors 83Looking at types of investors 83Compensating your investors 85Getting a Loan 87Visiting your local bank 87Finding government assistance 88Chapter 6: Choosing a Location 89Looking at the Local Real Estate Market 89Examining Location Specifics 90Considering access and visibility 91Paying attention to traffic 92Knowing which locations to avoid 93Looking at other businesses in the area 94Considering security 94Factoring In Cost Considerations 95Chapter 7: Paying Attention to the Legalities 97Identifying the Help You Need 98Looking at the roles to fill 98Setting Up Shop on Legal Grounds 99Going it alone: Sole proprietorships 100Teaming up: Partnerships 100Almost teaming up: Limited partnerships 100Playing it safe: The corporate entity 101Blend of three: The LLC 101Knowing Your Local Laws 101Getting Permits and Licenses 102Acquiring a liquor license 103Heeding health codes 105Paying attention to building codes 106Considering fire codes and capacity 107Checking out other permits 107Taking up trademarks 108Buying the Insurance You Need 109Part 3: Preparing to Open the Doors 111Chapter 8: Creating the All-Important Menu 113Making Some Initial Decisions 114Matching your menu to your concept 114Considering customers: Feeding the need with an insights-driven menu 115Matching your menu to your kitchen 116Cutting your chef (if you have one) in on the action 117Figuring Out How Much to Charge 118Determining your menu price points 118Using food cost percentage to set prices 119Creating dishes and recipes and then costing them 121Dealing with price fluctuations 122Mixing your menu to meet an overall percentage goal 123Deciding When to Change Your Menu 124Staying flexible when you first open 124Revisiting your menu later on 125Offering specials 126Highlighting new news 126Choosing Your Menu Format 127Counting your main menu options 127Considering additional presentations 130Selling the Sizzle: Setting Up a Menu with Sales in Mind 132Directing eyes with menu engineering 132Getting people salivating: Considering visual representation on the menu 133Money for ink: Using lingo that sells 134Validating Your Menu before You Go Primetime 135Chapter 9: Setting Up the Front of the House 137Digging into Design 138Identifying pros who can help 140Getting the scoop on potential pros 141Thinking outside the Box: The Exterior 142Laying Out the Interior 144Allowing space for the flow 145Building your floor plan 145Creating space to wait 147Keeping Service Support Close 148Wait stations 149Point of sale (POS) stations 150Tabletop settings 151Setting Up a Reservation System 152Taking traditional reservations 153Accepting online reservations 154Reviewing Restrooms 155Providing public facilities 155Earmarking areas for employees 156Chapter 10: Setting Up the Back of the House 157Planning a Kitchen with the Menu in Mind 157Figuring out what you need to fix the food on your menu 158Reviewing the basic kitchen stations 159Taking control of your prep 164Laying out your kitchen 168Considering Your Water Supply: Why Water Quality Matters 170Adapting an Existing Kitchen 171Acquiring Your Kitchen Equipment 172Deciding whether to buy or lease 173Moving beyond name-brand equipment 175Getting purchasing advice 176Chapter 11: Setting Up a Bar and Beverage Program 177Setting Up Your Bar 178Figuring out furniture 178Selecting equipment 179Selecting smallwares 181Surveying supplies 183Keeping Your Bar Clean 184Drawing Drinking Crowds 185Running promotions 185Providing entertainment 186Offering great bartenders 187Get with the (Beverage) Program: Providing Liquid Refreshment 188Creating your beverage program 188Developing a robust nonalcoholic beverage program 189Becoming Beer Brainy 190Winning with Wine 191Creating your list 192Pricing your wine 194Storing your wine 195Lapping Up Some Liquor Learning 196Pour size and pricing 196Liquor lingo: Understanding cost and quality 197Serving Alcohol Responsibly 198Chapter 12: Hiring and Training Your Staff 201Deciding Which Roles Need to Be Filled 201Managing your quest for managers 203Staffing the kitchen 206Filling the front of the house 210Staffing the office 213Finding the Right People: Placing Ads and Sifting through Résumés 215Interviewing the Candidates 216Round 1: The meet and greet 217Round 2: Comparison shopping 218Bonus rounds: The inevitable re-staffing 219Hiring Foreign Nationals 220Double-checking the documents 220Evaluating the E-Verify system 220Petitioning for an employee 221Training Your Staff 221The employee manual: Identifying your company policies 221Operations manuals: Understanding specific job functions 222Creating a training schedule 223Chapter 13: Purchasing and Managing Supplies 225Preparing to Stock the Supply Room 225Listing what you need 226Considering premade items 228Finding and Working with Purveyors 228Finding and interviewing suppliers 229Comparing prices, quality, and service 231Considering the size of suppliers 232Getting the right quality at the right price 232Getting what you ask for the way you ask for it 233Building an Efficient Inventory System 234Managing the inventory 234Reducing waste 237Eliminating spoilage 238Chapter 14: Running Your Office 241Deciding Where to Put Your Office 241Creating a Communications Hub 242Counting on your computer 242Picking up the phone 243Using e-mail and online services 243Tracking sales with a point-of-sale system 244Interfacing your different systems 246Hardware (the Old-Fashioned Variety) 246Processing Payments 247Credit and debit card transactions 248Gift cards 248Contactless and proximity payments 250Preparing for Payroll 250Farming it out or doing it in-house 251Deciding on a payroll period 252Choosing salaries or hourly wages 252Choosing a method of payment 253Saving, Storing, and Protecting Your Records 254Chapter 15: Getting the Word Out 257Defining Your Message 258Focusing on the consumer and tailoring your message 258Communicating your concept 259Keeping up with the competition 259Getting tactical 261Building Public Relations 262Planning for the good and the bad 262Your PR campaign: Going it alone 263Getting some help with PR 265Creating an Advertising Plan 266Creating a Compelling Restaurant Website 268Sounding Off on Social Media 269Investigating your options 270Responding to reviews both positive and negative 275Part 4: Keeping Your Restaurant Running Smoothly 277Chapter 16: Managing Your Employees 279Selling Employees on Your (or Their) Restaurant 279Educating your employees 280Motivating your staff 281Making Staff Schedules 283Adding it all up: How many workers you need 283Putting names to numbers 285Setting Up Policies to Live (or Die) By 287Scheduling and attendance 287Smoking 288Drinking or using illegal drugs 289Uniforms and grooming standards 289Social media policies 290Disciplinary measures 292Offering Benefits 293Looking at health insurance 293Considering other benefits 293Chapter 17: Running a Safe and Clean Restaurant 295Making Sure Your Food is Safe 295Blaming bacteria and viruses 296Battling illness: Time and temperature 297Preventing cross-contamination 299Monitoring food safety outside the kitchen 299Monitoring food safety outside the restaurant 300Critical control points: Following HACCP guidelines 301Staff education: Picking up food safety tools 301Implementing proper hand-washing procedures 302Keeping the Restaurant Clean 302Getting cleaning supplies 303Scheduling your cleaning 304Opening and closing procedures 309Taking Precautions to Protect Your Customers and Staff 310Food allergies and other dietary concerns 310First aid 312Exits: In the event of an emergency 312Providing a Pest-Free Place 313Handling the Health Inspection 314When the inspector arrives 315During the inspection 315Avoiding a bad inspection 316Chapter 18: Building a Clientele 317Understanding Who Your Customer is 318Meeting and Exceeding Expectations 319Turning Unsatisfied Guests into Repeat Customers 321Recognizing unsatisfied guests 322Making things right 324Making Social Media Work for You 325Chapter 19: Maintaining What You’ve Created 327Evaluating Financial Performance 328Daily business review 328Income statement 330Cash flow analysis 330Evaluating Operations 332Menu mix analysis 332Purchasing and inventory analysis 335Evaluating and Using Feedback 337Paying attention to customer feedback 337Responding to professional criticism and praise 339Listening to employee feedback 342Part 5: The Part of Tens 343Chapter 20: Ten Myths about Running a Restaurant 345Running a Restaurant is Easy 345I’ll Have a Place to Hang Out 346I Can Trust My Brother-in-Law 346The Neighbors Will Love Me 347I’ve Been to Culinary School, So I’m Ready to Run the Show 347I’m Going to Be a Celebrity Chef 347My Chili Rocks, So I Should Open a Place 348I Can Cut the Advertising Budget 348Wraps are Here to Stay 348I’ll Be Home for the Holidays 349Chapter 21: Ten True Restaurant Stories That You Just Couldn’t Make Up 351Déjà Vu All Over Again 351Priceless 352Free Pie Guy 352Rat-atouille 352Frosty the Newbie 353Drinks are on Me 353You Like My Tie? 353Chefs Behaving Badly 354Radio Fryer 354(Coat) Check, Please! 354Index 355