Big Plans for Your Restaurant in 2016? Be Financially Prepared
Being financially ready to make big changes to your restaurant isn’t just about understanding your budget. Current trends, shifts in customer behavior and the restaurant experience itself all play a role. If you have something big planned for 2016, these tips can help ensure success.
Take a look at your current income, expenses and resources. Do you have enough to realistically move forward with changes to your restaurant? If not, how much more would you need to cover all the bases?
Going forward with any kind of change is risky, and you don’t want to take that risk if you’re not sure your business can support it.
If you feel certain that changes will help your restaurant reach new heights, consider taking out a working capital loan to cover the cost of renovations without hurting your cash flow.
Do the Math
An in-depth understanding of your budget is a key part of determining whether or not your restaurant is ready for change. Make a list of all the things you’re envisioning, including:
- Moving to a new location
- Opening a second location
- Expanding your current location
- Adding a bar
- Obtaining a liquor and wine license
- Updating your menu
- Changing theme or design
- Adopting a more sustainable approach
- Changing your advertising
Depending on what your desired changes will cost, you may need a business line of credit to cover the expenses. If so, loan payments must be taken into consideration when working up a new budget. Also consider the money you’ll need to put toward rent, new staff, expanded inventory or increased supply prices when budgeting.
Check the Trends
What people expect from restaurants is always changing, and your restaurant needs to move with the times to remain profitable. Whether it’s offering the organic and local food your customers demand or installing point-of-sale systems that accept NFC methods, be sure to make the latest trends part of your plans for change.
Update Your Business Plan
In many ways, a major change is like a new start for your restaurant. Work up a business plan accordingly using the same methods you did when first starting out to give you a clear picture of your business landscape.
Be as clear and detailed as possible, outlining all the intended changes and the associated financial requirements. Make projections based on current performance to show the potential growth that the proposed changes will bring to your business.
How customers feel about your restaurant has a direct impact on every important financial metric. Without satisfied customers, you won’t bring in the money necessary to continue growing your business in the long term.
Whatever changes you implement, make sure that customer satisfaction doesn’t get lost in the shuffle. Maintain a clean, inviting atmosphere, train your staff well and stay focused on the vision that made your restaurant popular in the first place.
If all the numbers check out and customer attitudes are positive, you should be right on track for the changes you want to make to your restaurant. Do all of your research before forging ahead into new territory, and watch your business grow in the coming year.
If you’re interested in obtaining a small business loan for your restaurant, learn about our new client offer today where you can receive a $1,000 Amex gift card just for borrowing from ARF Financial.