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OVERVIEW
Restaurant development comprises three stages:
Phase 1, the deal
Phase 2, the build-out; and
Phase 3, operations.
The New Restaurant Entrepreneur focuses on Phase 1 - where
the fate of the business is determined. A focus on Phase 3
at the expense of Phase 1 often relegates management to operating
a ridiculous undercapitalized concept with an inexperienced
team composed of life long underachievers.
Phase 1 consists of four components:
1. concept
2. team
3. real estate
4. investors
We consider menu engineering, energy sources, table-turns
and sales mix. We think about the difference in return on
invested capital for sit-down lunch players vs. upper end
casual dining players. We discuss the benefits and drawbacks
of discounting/couponing and we position our concept using
demand-side analysis.
We address how much money is needed? How much working capital?
How much equity do my investor(s) require? Should my chef
become a partner? How about the GM, the designer, the wallboard
supplier? What should my concept be? Asian/hip? A steakhouse?
A sit-down lunch restaurant? Should I select a concept that
I am familiar with or a concept that is today's trend?
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