Every restaurant owner has dreams of expanding their restaurant business. They want more seating, additional restaurant locations, or perhaps even aiming for restaurant franchisees in another city. However, restaurant expansion is not as simple as just wanting it to happen. You need proper planning before beginning the restaurant expansion process. And it would help if you considered some critical essentials of the restaurant expansion strategy.
Restaurant Expansion Strategy
The following restaurant expansion essentials will help you manage your restaurant profit and cash flow, minimize risk and ensure restaurant success after the restaurant expansion process.
1. A Thorough Business Plan For Each Location
A restaurant is a business, and to make restaurant expansion successful, you need to start with a restaurant business plan. A thorough business plan for the restaurant will help you identify the costs involved when expanding your restaurant location or adding additional restaurant locations.
Your restaurant business plan should include:
- Capital requirements (what do you need)
- Timeframes (when they are required)
- Restaurant location (where they’ll be)
Ideally, restaurant expansion should be rolled out as a restaurant franchise, which will help you minimize restaurant capital and location requirements. However, restaurant franchising is not suitable for all restaurant owners, so create your restaurant business plan to identify the right restaurant expansion strategy for your restaurant.
2. Meeting Your Financial Obligations
Once you have identified and controlled restaurant expansion costs, restaurant owners should consider a restaurant working capital loan to meet restaurant expenses during the restaurant expansion process. As a restaurant owner, you’ll have your present restaurant business expenses while new restaurant locations are being opened or additional seating. You must use only the amount of money you need at any given time.
To get a restaurant working capital loan, you should apply restaurant credit line to get cash when needed. This restaurant business loan application is easy, and restaurant owners can complete the restaurant loan application in ten minutes. Once approved, restaurant owners will receive their restaurant line of credit within 24 to 48 hours. However, restaurant owners should note that restaurant credit lines are factoring in restaurant receivables financing instruments.
After successfully opening your new restaurant locations or completing your expansion project, restaurant owners are advised to consolidate their restaurant credit line with other restaurant loans. It’ll give restaurant owners the best borrowing power for future restaurant expansion projects.
3. Successful Restaurant Marketing
Restaurant marketing is essential to restaurant success during and after restaurant expansion. Your new restaurant location or additional seating should be able to attract your target market segment. You should consider restaurant marketing that provides your restaurant business with the best restaurant location, restaurant equipment, and restaurant supplies. You can also consider digital restaurant marketing to attract customers affordably.
Your restaurant marketing plan should include:
- Restaurant promotions (e.g., discounts)
- Target market segments (e.g., age group, restaurant ethnicity, restaurant gender)
After successfully attracting customers to your restaurant locations or seating areas, restaurant owners should consider restaurant loyalty programs to encourage patronage. You can also consider restaurant take-out services or dine-in services to attract customers.
4. Restaurant Expansion Risk Management
The restaurant expansion process does not end after successfully adding restaurant locations or increasing restaurant seating. It would be best to manage restaurant expansion risks to save the restaurant business in the event of restaurant disasters, restaurant injuries, or restaurant losses.
Your restaurant risk management plan should include:
- Employment practices liability insurance (e.g., restaurant workers comp)
- General liability insurance (e.g., restaurant property damage)
- Commercial restaurant insurance (e.g., restaurant equipment, supplies, business interruption)
It would help to prioritize restaurant safety for your staff or customers. You can achieve this through restaurant active shooter training, which will help you protect customers and employees during the event of an active shooter incident at your restaurant locations.
5. Ongoing Restaurant Expansion Management
Once you have successfully added restaurant locations or increased restaurant seating, restaurant owners are advised to monitor the restaurant’s performance during restaurant expansion. You should compare restaurant sales before and after restaurant location or additional seating additions. If necessary, restaurant owners can take corrective actions by re-focusing their marketing efforts on the new restaurant locations or restaurant seating.
You should also consider restaurant expansion financing to protect your restaurant business from restaurant disasters that can affect the restaurant’s performance. Your restaurant insurance provider may provide property insurance for your new restaurant locations or additional seating. However, before you apply for a commercial loan to finance your restaurant expansion project, you should first ensure restaurant cash flow. After restaurant owners review their financial records, they should monitor restaurant inventory to ensure restaurant success during restaurant expansion.
If your restaurant business experiences regular restaurant growth, you can consider using restaurant franchising to expand your restaurant operations or increase restaurant sales. It would be best to consider a franchise attorney consultation before applying for restaurant franchising opportunities.
6. Plan For Franchising Opportunities
Restaurant franchise development consultants can provide the latest restaurant market research for restaurant owners exploring restaurant franchising opportunities. Your restaurant consultant should identify potential restaurant markets that are suitable for your restaurant business expansion.
Before opening additional locations or increasing seating, restaurant consultants advise restaurant owners on market analysis, site selection, and restaurant design. If restaurant owners need restaurant expansion services, restaurant consulting firms can assist restaurant operators by conducting feasibility studies and restaurant site evaluations.
Is Your Restaurant Ready for Franchising?
For restaurant owners who want to explore restaurant franchising opportunities, you should first ensure that the business is ready for franchising. Before applying for a franchise program, your business should have a solid track record of success and consistency. You should also have sufficient operational experience. In addition, your business should be able to support franchisee needs.
If you’re interested in restaurant expansion through franchising, you should consider working with a franchise attorney. They can help you apply for a restaurant franchising opportunity and navigate the legal process. After you have successfully negotiated your franchise agreement, your lawyer may be able to represent you during the due diligence phase of your expansion project.
When it comes to restaurant expansions, your business must ensure that all locations are prepared to provide your customers with an exceptional experience. Thus, you should expand your operation safely to allow everyone to enjoy the meal they deserve.
Restaurant owners should plan for restaurant expansion to ensure that the business will be profitable and sustainable.
When an existing restaurant experiences growth, you should take the necessary steps to ensure restaurant success during expansion. If you plan for successful restaurant expansion, you can reduce the possibility of experiencing operational problems.
A restaurant is said to be only as successful as its last meal. Customers tend to refuse to dine at failing restaurants, which means that if you want your restaurant to continue growing, you need to expand. By following these restaurant expansion tips, you can open a new location or increase the seating capacity in the safest manner possible.