Part One: The Idea · Chapter 1
Is a Restaurant Right for You?
Before you look at a single property or taste a single recipe, look honestly at yourself. This chapter sets out what running a small restaurant, café or cloud kitchen really asks of you, so that you can make your decision knowing what it involves.
Why start with you, not the food?
Most people who dream of opening a restaurant begin with the food. They picture a menu, a dining room full of happy customers and a kitchen humming with activity. That picture is not wrong, but it leaves out the person at the centre of it: the owner. A small food business is shaped far more by its owner's energy, habits and money than by any single dish.
In a large company, a weakness in one person is covered by others. In a small café or restaurant, the owner is often the buyer, the cook, the manager, the bookkeeper, the cleaner when nobody else can do it, and the face that customers know. If you dislike paperwork, the paperwork still has to be done. If you find it hard to speak firmly to staff, problems will still need to be dealt with. If you have never gone six months without a regular income, you may be about to.
None of this is meant to discourage you. Many people open small food businesses, and many of them build something they are proud of. The ones who last tend to have one thing in common: they understood what they were taking on before they started. That is the purpose of this chapter.
Meet the three founders
Throughout this book we follow three fictional businesses from first idea to the end of their first year. Their numbers and decisions are used as worked examples in later chapters.
- Clara Whitmore, 34, has spent eleven years as an office manager and has sold her cakes at weekend markets for the last two. She wants to open The Linden Tree Café, a daytime café with 32 seats.
- Tom Ashworth, 28, is a trained chef who has worked in hotel and restaurant kitchens for eight years. He plans Ashworth Kitchen, a delivery-only cloud kitchen selling rice bowls, wraps and salads.
- Helen and David Marsh, both in their mid-forties, plan The Copper Pot, a 44-seat neighbourhood restaurant. Helen has twenty years of restaurant experience; David is a joiner who will manage the building work.
What the work is really like
People who have never run a food business often underestimate three things: the hours, the physical effort and the number of small decisions that fill every day.
The hours
A café that opens from 8 am to 4 pm is not an eight-hour day for its owner. Someone has to arrive early to bake, set up and take deliveries, and someone has to stay late to clean, cash up, place orders and plan tomorrow. Add weekly tasks such as paying suppliers, doing the staff rota and keeping the accounts, and a working week of sixty hours or more is not unusual in the first year. Restaurants that serve dinner have the added strain of late nights followed by early deliveries.
Cloud kitchens are sometimes described as the easy option because there is no dining room. They do remove front-of-house work, but they tend to trade in the evenings and at weekends, when delivery demand is highest, and they are judged minute by minute on how fast orders leave the kitchen.
The physical effort
Kitchens are hot, crowded and busy. Owners lift heavy boxes, stand for hours, work near hot fat and sharp knives, and clean floors after everyone else has gone home. If you have a physical limitation, that does not rule you out, but it does mean planning the work and the staffing around it from the start, rather than hoping it will work out.
The small decisions
On a single day an owner may decide whether to accept a delivery of poor vegetables, how to respond to a complaint, whether to send a tired member of staff home early, whether a slow Tuesday means a change to the menu, and whether a new supplier's lower price is worth the risk. Each decision is small. Together they are the business.
Try it first. If you have never worked in a busy food business, spend some time doing so before you commit. Working a few weekends in a café or a restaurant kitchen will teach you more about the job than any book, including this one. If you offer to work without pay, check first that this is allowed where you are (Chapter E-6, Employing staff).
Clara's reality check
Clara's market stall had taught her that she could bake well and enjoyed selling to people. What it had not taught her was what a full week felt like. She arranged with the owner of a busy café in a neighbouring town to work there three Saturdays and two weekday mornings. By the end of the second Saturday her feet ached, she had burned her wrist on a steam wand, and she had loved almost every minute. More usefully, she had watched the owner spend forty minutes after closing on paperwork and ordering. “That's the bit nobody sees,” the owner told her. Clara wrote it down and began timing the jobs she would have to do herself.
The skills a small food business needs
No owner is good at everything. What matters is knowing which skills the business needs, which of them you have, and how you will cover the rest. The list below is a practical way of thinking about it.
| Area | What it involves | How the gap can be covered |
|---|---|---|
| Cooking and food knowledge | Producing consistent dishes, planning a menu, controlling portions, knowing food safety in practice | Hire an experienced chef or cook; take a recognised food hygiene course; start with a smaller, simpler menu |
| Customer service | Welcoming people, handling complaints calmly, building regular custom | Hire front-of-house staff with experience; train yourself by working a busy service elsewhere |
| People management | Recruiting, training, rotas, discipline, keeping good staff | Learn the basics of employment law for your country (Chapter E-6, Employing staff); keep written procedures; ask an experienced manager to mentor you |
| Money and records | Pricing, budgets, cash flow, bookkeeping, paying tax on time | Use simple accounting software; employ a bookkeeper or accountant; use the worksheets and calculators in this book |
| Buying and stock | Choosing suppliers, ordering the right amounts, reducing waste | Start with a few reliable suppliers; use a weekly stock sheet (Chapter 11) |
| Marketing | Being found online, signage, social media, reviews, delivery app listings | Learn the basics yourself; buy in help for photography or a website |
| Practical and building work | Understanding fit-outs, equipment, repairs and maintenance | Get quotes from qualified trades; keep a list of reliable repairers |
Look at the three founders. Tom is strong in the kitchen but has never managed money or done his own marketing. Clara is organised and good with customers, but she has never cooked for forty people at once. Helen knows how to run a restaurant floor and manage staff; David knows buildings; neither of them is a chef, so hiring the right head chef is their most important decision. Each of them has gaps. Each of them will need to plan for those gaps, which is exactly what later chapters help you do.
Money: what you can afford to risk
Opening a food business costs money before a single customer walks in or a single order arrives. Premises, equipment, fit-out, deposits, licences, first stock and marketing all have to be paid for in advance. Then there is usually a period, often several months, before the business covers its own costs. During that time, you still need to pay your own rent or mortgage and feed your household.
Chapter 16 works through start-up costs in detail and Chapter 17 explains break-even. At this stage you only need to answer three honest questions.
- How much money can you put in yourself? Count only money that is truly available: savings, or money from a family member who fully understands it may be lost. Do not count money that is set aside for something else.
- How much could you lose without ruining your life? This is not the same as the first question. Many owners put in everything they have and then borrow more. A safer rule is to decide in advance how much you could lose and still recover, and to treat that as your real limit.
- How long can your household live without income from the business? Add up your essential monthly living costs and see how many months your reserves would cover. Many owners pay themselves little or nothing for the first six months or more.
The Marshes work out the numbers
Helen and David worked out that their household needed about £2,600 a month for the mortgage, food, bills and the children. Helen would stop earning a salary when she left her job; David planned to keep taking some building work for the first few months while the fit-out went on. They decided to keep £15,600, six months of household costs, in a separate account that would never go into the restaurant, whatever happened. “If the restaurant needs that money,” Helen said, “it means the plan was wrong, and we would rather find that out than lose the house.”
Be careful with personal guarantees and borrowing against your home. Lenders and landlords often ask small business owners to guarantee debts personally, or to borrow against property. This can mean that if the business fails, you lose far more than the money you put in. Before you sign anything like this, take independent professional advice. The rules for your country are covered in Chapter E-9, Funding and Chapter E-7, Premises and leases.
Your household and your health
A food business affects everyone you live with. Long hours mean fewer evenings and weekends at home. You will often take money worries home with you. Your partner or family may end up helping in the business, sometimes more than they intended. It is worth having an honest conversation before you start about what support you will need and what the people close to you are willing to give.
It is also worth thinking about your own health. Stress, poor sleep, skipped meals and long periods on your feet are common in the first year. Owners who last tend to build small protections into their plans from the start: one day a week that is truly off, a rota that does not depend on them working every shift, and someone they trust who can open or close without them.
Tom's question
Tom was used to long hours, but in hotel kitchens someone else had always sorted out the money. When he explained his plan to his partner, she asked a simple question: “What happens if you are ill for a week?” He had no answer. A cloud kitchen with one chef and nothing else simply closes. That question led Tom to plan from the start for a second person who could run the kitchen alone. He could not afford a second chef, so he hired Ben as a full-time prep cook and trained him to cook every dish on the menu before he opened.
Good reasons and weak reasons to open
People open food businesses for many reasons. Some are strong foundations for a business; others are better treated as warning signs. Being honest about your own reasons helps you decide what kind of business, if any, suits you.
Stronger reasons
- You have seen a clear gap in your area that you believe you can fill.
- You enjoy the daily work itself, not only the idea of owning a business.
- You have tested your food on paying customers, not only on friends.
- You have relevant experience, or you are willing to get it first.
- You have a realistic budget and a reserve for hard months.
Weaker reasons
- “Everyone says my cooking is wonderful.” Friends are not paying customers.
- You want to escape a job you dislike, but have not tested whether you like this one.
- You have seen successful restaurants on television.
- You want a relaxed lifestyle. A new food business is rarely relaxing.
- You have come into some money and want to “do something with it”.
Having a weak reason does not mean you must stop. It means you have more testing to do before you spend. Chapter 3 shows how to test an idea cheaply.
Choosing the right size of first step
If this chapter has left you unsure, that is useful information, not a failure. A full restaurant is not the only way into the food business. There are smaller first steps that let you learn the trade and test demand with less money at risk:
- A market stall or pop-up. Low cost, short commitment, direct contact with customers. This is how Clara began.
- Catering for events. Weddings, office lunches and parties, cooked in a suitable kitchen.
- A delivery-only trial. Selling a small menu through a delivery app from a shared or hired kitchen for a few months.
- Working in the trade first. A year as a manager or cook in someone else's business is an education that pays you instead of costing you.
- Taking over an existing business. Buying a café or restaurant that is already trading can save fit-out costs, but brings its own risks. Always find out why it is being sold, and take professional advice before buying.
Whatever you choose, the food law of your country applies from the first sale, even at a market stall. Chapter E-3, Registering your food business explains what that means where you are.
Where the three founders stand
By the end of this stage, all three had decided to go ahead, but each for slightly different reasons and with different amounts of risk. Clara had two years of market sales behind her and a clear sense of who her customers were, but no experience of running staff. Tom had the cooking skills and a lower start-up cost, but little experience with money. Helen and David had the most experience and the biggest budget, but also the most to lose. As you read on, notice how each of their starting points shapes the choices they make.
Key points
- A small food business depends heavily on its owner's time, energy, skills and money.
- Expect long hours, hard physical work and many small daily decisions, especially in the first year.
- List the skills the business needs, be honest about your gaps, and plan how each will be covered.
- Decide in advance how much money you can afford to lose, and keep a household reserve that never goes into the business.
- Talk to the people you live with before you commit.
- If you are unsure, take a smaller first step to test the idea and whether you enjoy the work.
Worksheet 1.1: Personal readiness check
Score each statement from 1 (not true of me at all) to 5 (completely true of me). Be honest: nobody else needs to see this. When you have finished, look at any statement you scored 1 or 2 and write down what you will do about it.
| Statement | Score (1 to 5) |
|---|---|
| I have worked in a busy food business, or I will do so before I commit. | |
| I am prepared to work long hours, including evenings and weekends, for at least the first year. | |
| I am physically able to do the work, or I have planned the staffing around what I cannot do. | |
| I can stay calm and polite when a customer complains. | |
| I am willing to give instructions to staff and deal with problems firmly and fairly. | |
| I am comfortable with numbers, or I will get help with the accounts. | |
| I know exactly how much of my own money I can put in. | |
| I have decided how much I could lose and still recover. | |
| My household could manage for at least six months without income from the business. | |
| The people I live with understand what this will involve and support it. | |
| I have tested my food on paying customers, not only on friends and family. | |
| I have a plan for what happens if I am ill or away for a week. |
| Statements I scored 1 or 2 | What I will do about it, and by when |
|---|---|
Worksheet 1.2: Skills and gaps
For each area, write down how strong you are now, and how you will cover any gap: by learning, by hiring, or by buying in help.
| Area | My strength now (strong, some, none) | How I will cover the gap |
|---|---|---|
| Cooking and food knowledge | ||
| Customer service | ||
| People management | ||
| Money and records | ||
| Buying and stock | ||
| Marketing | ||
| Practical and building work |
Worksheet 1.3: Household money check
Fill this in with your own figures, in pounds. It tells you how long you could manage without income from the business.
| A. My essential household costs each month (rent or mortgage, food, bills, loan repayments, other fixed costs) | |
| B. Other household income each month that will continue (for example, a partner's salary) | |
| C. Monthly shortfall (A minus B) | |
| D. Savings I will keep aside for the household, not for the business | |
| E. Number of months I could manage (D divided by C) |
If C is zero or less, your household can manage without income from the business, but still keep D aside for emergencies. If E is less than six, think carefully about waiting, saving more, or starting with a smaller first step.