Open for Business: A Guide to Starting Your Restaurant

The restaurant business is one of many ventures that tend to do well in a recession. People might not eat out as much during a slow economy, but businesses built around food will still get customers. And in the Philippines, the restaurant industry is booming.

An Attractive Investment

Filipinos, according to a report from The Business World, have more disposable income now more than any other time. As such, people are spending on fashion, furnishings, fun, and food. The report goes on to add that groceries are selling fewer items because people are eating out more, citing a marketing survey.

Clearly, there is demand for dining establishments. Where there’s demand, there’s bound to be competition.

The Department of Trade and Industry shares that there were 6,652 full-service restaurants at the start of 2016; 3,748 cafeterias, 1,445 bars and pubs, 3,772 food kiosks, and 4,477 fastfood restaurants.

Throughout the auditing period, these businesses also showed strong revenues, with full-service restaurants generating P158.1 billion; meanwhile, cafeterias earned P15.8 billion, bars and pubs had P10.9 billion, food kiosks made P17.7 billion, and the fastfood brands took in P144.8 billion.

In addition to these traditional food-based ventures, e-commerce is also presenting a formidable match with online ordering and delivery services raking in P4.9 billion.

Clearly, restaurants can turn a profit. You just have to make sure that your dining establishment can capture and sustain attention from diners.

How do you do it?

A Taste of Success

Most food businesses that have hit it big in the local market began humbly enough. Some even started off with meager capital. Take Ineng’s Special Barbecue.

Inengs began with a stall in Sidcor Weekend Market and a P2,000 capital in 1999. Soon enough, word-of-mouth propelled the small business into what it is today: a restaurant offering franchising opportunities.

Success told this way sounds easy enough. But no big business has thrived and survived a slow economy without hard work. Inengs had its special barbecue sauce going for it. Many other restaurants continue to receive the patronage they receive because they’ve been able to offer diners something different.

But is that all there is to creating a restaurant that’s going to be top of mind for Filipino diners?

The restaurant business is complex. Moreover, today’s consumers are more sophisticated so the usual menu, even ones that seem gimmicky, is not going to be enough to sustain attention. What you need is a menu of strategies in place before you start looking for a location for your business.

Here’s a quick rundown of what you’ll want to apply:

Choose a business that’s excites you

Every entrepreneur naturally aims for profits, but money should not be your lone motivation. Sure, money’s good (more money’s even better). The trouble with starting a restaurant with this in mind is that it might not hold your attention long enough to stick to it.

You may be financially invested in, for example, a concept restaurant focusing on Korean desserts, but if you’re not into the trendy food, the business might suffer from a lack of new ideas and marketing strategies to beat the competition.

So even if you’re into something as ordinary as fried chicken or tofu, you could build a good business out of your passion.

Find your market

What type of diner do you want to attract? You might be tempted to appeal to all consumers, but a general market might be more trouble than it’s worth. Marketing to all will leave you with a confusing set of strategies that might not yield the results you need. It’s better to focus on a specific segment as your target market rather than seeking to serve just about any diner.

A well-developed target market allows you to craft a clear message. Because you’re also starting the business, a defined customer profile helps you tailor every aspect of your restaurant to a particular demographic even before you get your first diners into the door.

Develop your menu

Too many items could confuse diners, too little could leave them to seek other menus. Some diners would not want to waste time leafing through, for example, five pages of food and others would want more than a few options.

A winning menu delivers on the following:

  • Culinary experience that differs from the competition
  • Price point that appeals as well as makes a profit
  • Specific to your demographic

When you know your target market, you’ll be in a better position to develop a menu that entices diners to return.

Hire the right staff

Every single person on your staff is crucial to the success of your restaurant, from the front of the house to the back of the house. You start with a talented chef who can bring in and manage a good kitchen staff. Then work your way toward building a waitstaff that will represent your business the way you envision.

A good team is an investment because they can help make your restaurant a success overnight or a failure over time. So don’t take any shortcuts; if you can, let a professional agency head hunt the key positions in the kitchen and the dining area.

Choose the appropriate location

Your target market can identify the ideal location for your restaurant. For example, if your customer profile is a young professional, you might want to consider business districts in the city or up and coming neighborhoods.

In addition, you’ll want to make sure that your establishment is accessible; this includes your staff. It’s not likely that the traffic situation in Metro Manila is going to get resolved, anytime soon. So you’ll need to consider how your employees are going to get to work. You don’t want to be left with a lean staff on, for instance, lunch rush.

Market your restaurant online

Digital marketing is a cost-effective way to get the word out about your restaurant. You could start with a social media page, with attractive images, updated posts targeted to your customer profile, and complete business details.

You’ll also want to claim your business on Google My Business. It’s a free business listing that could give your restaurant better exposure. With it, you can reach customers even without a website. But if you want a website, you can do it for free with the platform.

Finally, make sure your paper work’s in order, from the essential licenses (health, liquor, and others) to the relevant permits (local government unit, building permit, and others). When you’ve planned for every detail, opening night for your restaurant will go off with little to no hitch at all.

There is demand for dining places in the Philippines, but there is also stiff competition. So make sure your restaurant appeals to and sustains the interest of today’s sophisticated diners with the right strategies.

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