The material is about the cost of opening a restaurant in San Francisco, but it is also applied to other places in USA.
One huge part of the cost is renting the space and building out the restaurant itself. For the sake of simplicity, let’s use the number of $900 a square foot to build out your kitchen and dining room. For 2,500 square feet the build out will cost you $2,250,000. (Remember these are just theoretical numbers, for a high-end place.) For your space, take improvement and upgrades you intend to make and divide by the total square footage. Plus, your rent on a space in the city — maybe as much as $6 per square foot — on 2,500 square feet could be as much as $15,500 per month. Of course, If you want to buy a space instead of renting, it will be much more expensive.
Another big part of the cost is the liquor license. A full liquor license in San Francisco will cost you as much as $250,000. In other cities of USA, it is quite expensive too. Furthermore, you will need a contingency fund in case you run into some problems and delays throughout your investment.
What delays could there be:
• Certificate of occupancy on your restaurant from the City
• Construction delays
• Delay in approval of a liquor license
• Construction delays
• Health department sign off
• Fire department sign off
There are many other aspects in which you need to spend money when opening a restaurant:
• Certificate of occupancy on your restaurant from the City
• Construction delays
• Delay in approval of a liquor license
• Construction delays
• Health department sign off
• Fire department sign off
There are many other aspects in which you need to spend money when opening a restaurant:
• A restaurant designer
• A public relations firm
• A lawyer to put together your partnership and operating
agreements.
• Liquor and wine inventory
• Food inventory
• China glass and silverware
• Music system
• Two weeks of staff training before you open the doors
Operating a restaurant need the following costs:
1. direct cost : insurance, direct labor (salary and bonus of service stuffs), direct material ( food, liquor, napkin)
2. indirect cost (include overhead and period cost) : insurance, depreciation on the equipment, advertising fee, salary and bonus of stuffs and managers , utilities
The cost of opening and operating a restaurant has a close connection with the gross profit. So if the managers of restaurant can find some legal ways to low the cost, it will be a significant increase in profit even the revenue is stay the same.
http://insidescoopsf.sfgate.com/tjjacobberger/2011/01/21/the-cost-of-opening-a-restaurant/
• A public relations firm
• A lawyer to put together your partnership and operating
agreements.
• Liquor and wine inventory
• Food inventory
• China glass and silverware
• Music system
• Two weeks of staff training before you open the doors
Operating a restaurant need the following costs:
1. direct cost : insurance, direct labor (salary and bonus of service stuffs), direct material ( food, liquor, napkin)
2. indirect cost (include overhead and period cost) : insurance, depreciation on the equipment, advertising fee, salary and bonus of stuffs and managers , utilities
The cost of opening and operating a restaurant has a close connection with the gross profit. So if the managers of restaurant can find some legal ways to low the cost, it will be a significant increase in profit even the revenue is stay the same.
http://insidescoopsf.sfgate.com/tjjacobberger/2011/01/21/the-cost-of-opening-a-restaurant/
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ReplyDeleteWow! There is lots of cost factors to consider on opening the restaurant in US and it is really complicated to find out indirect cost factors such as depreciation on the equipment and utilities.
ReplyDeleteAnd now I'm curious about the profit factors of the restaurant :)