Updated on November 30, 2022
The financial part of your business plan defines your cash flow needs for the realization of your project. It is at the heart of the search for financing and allows investors or the bank to judge the soundness of your project.
In addition to your cash flow needs, your business plan establishes your financial forecasts including your start-up capital, your estimated turnover, your profits and your results. It also allows you to define your sales and marketing strategy as well as your legal status.
There is a whole series of ratios in the restaurant industry that allow you to build your business plan. We have given you an order of magnitude for each one. Obviously each project is different and these ratios are not absolute rules. They will help you to situate yourself in relation to the market standards.
To set prices, several elements must be taken into account.
The prices set by the market and therefore by your competitors will of course be studied, but this is not enough. The prices you indicate on your menu must also depend on the image you want to give to your restaurant and the margin you want to make.
Once you have taken all these elements into account, you can use the multiplier method to set your prices. This method consists of applying a multiplier to the cost of the material, so in the calculation we only take into account the price of the raw material, we do not take into account the personnel costs or other additional costs.
There are several rules to respect:
To establish the price of the wines on your menu, Les Grappes advises you :
To establish the price of the wines on your menu is to apply a multiplier to the purchase price of the wine.
This multiplication coefficient must take into account the purchase price of the wine of course, but also external factors such as the price of the rent of your establishment, your personnel costs etc. This is why, for example, the coefficients applied are generally higher in Paris than in the regions.
At Les Grappes, our experts include VAT in the coefficient. Once applied, you get a price including VAT.
It is advisable to apply a slight degressive on the coefficients.
For example :
The margin on solids is calculated as follows: (Sales before tax - Purchase cost of the food consumed) / Sales before tax.
The margin on liquids is calculated as follows: (Sales before tax - Cost of purchasing the drinks consumed) / Sales before tax
Generally, the margin on solids is around 72% and that on liquids 85%.
First of all, it is necessary to foresee the amount of all the expenses related to the purchase of the goods necessary for the elaboration of your meals. You will also need to budget for beverage purchases. The amount of these expenses must be in accordance with the margin that you plan to make afterwards.
In the forecast you should also take into account the rent for the commercial lease and the deposit paid at the beginning (which should be entered as an investment).
Then, in terms of overheads, we generally find :
It is important to separate tangible investments (premises, equipment, kitchen, stocks, maintenance products, computer equipment) and intangible investments (lease, salaries, communication).
Figures to know :
Build a good business case to convince your investors. The more persuasive and determined you are, the more investors will believe in your project and therefore trust you. Do not hesitate to constantly rework your business plan until it is perfect.
To learn more about the different options for financing your restaurant, see our dedicated article.
Les Grappes is an online platform for the sale of wines from winemakers, for professionals. We accompany cafés, hotels, restaurants, wine cellars in their choice of wines, but also in the realization of customized wine lists! According to your project, your tastes and your budget, we help you to choose the best wines, among more than 800 wine growers, in short circuit.Register for free to have our team contact you! For more information, go to our website.