Nos Conseils aux restaurateurs - Ouverture d'un restaurant : comment établir son business plan ? Les Grappes

Opening of a restaurant : How to draw up a business plan?

The financial part of your business plan defines your cash flow needs for the realization of your project. It is at the centre of the search for financing and allows the investors or the bank to judge the solidity of your project.

In addition to your cash flow needs, your business plan more broadly establishes your financial forecasts including your seed capital, turnover, profits, and results. It also allows you to define your sales and marketing strategy as well as your legal status.

The key ratios of your business plan

There is a whole series of ratios in the restaurant business that allow you to build your business plan. We have specified an order of magnitude for each one. Obviously each project is different and these rates are not absolute rules. They will help you to situate yourself in relation to the market standards.

  • Purchase of raw materials/CA (also called food cost in the catering industry): maximum 30 %.

  • The bonus cost, which takes into account personnel costs, raw material costs and packaging costs, may not exceed 60% of turnover. Your profitability must be ensured in view of the substantial initial investment.

  • Rent/turnover: 9 to 10 % max.

  • Personnel/CA costs: 30% maximum they are very important for a restaurant and many want to start small with very few staff. This can be dangerous if, for example, you are targeting a lunchtime clientele that is in a hurry and needs to be served quickly.

  • Share of salary costs in the price of a meal: Gross salaries + charges / CA HT (Recommended rate: between 35 and 45%)

  • Casting (loss, breakage, theft)/CA: 2% maximum.

  • Gross margin/Sales: 70%.

  • Promotion/CA budget: 4% at launch, 1-2% thereafter.

  • Net income/Sales: 10%.

Determining the price of food and beverages

When setting 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 put on your card must also depend on the image you want to give to your restaurant and the margin you want to make.

Once all these things are taken into account, you can use the multiplier method to set your prices. This method involves applying a multiplier to the cost of the material, so the calculation only takes into account the price of the raw material, it does not deal with personnel costs or other additional costs.

There are several rules to follow:

  • The higher the cost of materials, the lower the multiplier.

  • The higher the workload to deliver the service, the greater the multiplier.

  • The coefficient that you apply must enable you to generate a gross margin that is capable of covering all the expenses of your restaurant and to achieve a satisfactory result.

To establish the price of the wines on your wine list, Les Grappes advises you:

Establishing the price of the wines on your wine list means applying a multiplier to the purchase price of the wine.

This multiplying coefficient must take into account the price of the wine at the time of purchase, 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 provinces.

At Les Grappes, our experts include VAT in the coefficient. Once applied, it is therefore a price including all taxes that you get.

It is advisable to apply a fairly slight regression on the coefficients.

For example

  • A bottle bought 4€ HT, we can apply a coefficient 5 ? Calculation: 4€ HT x 5 = 20€ TTC à la carte
  • A bottle bought 8€ HT, we can apply a coefficient 4 ? Calculation: 8€ HT x 4 = 32€ TTC à la carte
  • A bottle bought 14€ HT, a 3.5 coefficient can be applied ? Calculation : 14€ HT x 3.5 = 49€ TTC à la carte

Margin calculation

The margin on solids is calculated as follows: (CA HT - Purchase cost of food consumed) / CA HT. The margin on liquids is calculated as follows : (CA HT - Purchase cost of the consumed drinks) / CA HT

Generally, the margin on solids is around 72% and the margin on liquids is around 85%.

Your financial forecast

First of all, it is necessary to plan for all the expenses related to the purchase of the goods needed to prepare your meals as well as to budget for the purchase of drinks. The amount of these expenses should be in line with the margin you plan to make afterwards.

In the forecast you must also take into account the rents foreseen for the commercial lease as well as the deposit paid at the beginning (this must be entered as an investment).

Then, in terms of overheads, we generally find :

  • Energy expenses
  • Equipment maintenance
  • Cleaning products
  • Small kitchen equipment
  • Professional insurance
  • Equipment rentals
  • The accountant's fees
  • Advertising expenses
  • Bank charges
  • Telecommunication costs.
  • Loan repayment (if a loan has been taken out)

Tangible investments (premises, equipment, kitchen, stocks, maintenance products, computer equipment) and intangible investments (lease, salaries, communication) should be separated.

Figures to know

  • A "safety cushion" of at least 15% will allow you to deal with the unexpected. - The rent or occupancy cost must not exceed 10% of your projected turnover.

  • Keep in mind that refusal of financing is possible on the part of the bank. Indeed, they consider that the risks associated with opening a restaurant are high (one out of every two restaurants farms before its third year of operation).

  • You generally need to contribute at least 30% of the financial contribution to be able to borrow money.

Build a good argument to convince your investors. The more persuasive and determined you are, the more investors will believe in your project and therefore trust you. Don't hesitate to constantly rework your business plan until it is perfect.

Restaurants, Bars, Hotels?

Build an inimitable wine list and save a lot of time when ordering.

Restaurants, Bars, Hotels?

Build an inimitable wine list and save a lot of time when ordering.

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