How Do I Start A Small Local Restaurant?

For many would-be business owners, running a restaurant is the ultimate career goal. This hope may have been temporarily shelved as the pandemic caused many restaurants to cancel indoor dining or even close permanently. As a whole, the restaurant industry is still recovering from the devastating effects of the coronavirus. The restaurant industry has adapted to the current crisis by embracing new dining preferences and broadening its sources of income. Many people still dream of opening their restaurant, so we made a checklist to help you get started.

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How Do I Start A Small Local Restaurant?

Starting a small local restaurant can be a challenging, yet rewarding experience. Here are some steps that can help you get started:

1. Research The Market: 

Researching the market is a crucial first step when starting a small local restaurant. It involves gathering information about the local competition, target audience, and demand for your restaurant’s concept. Here are some steps to follow:

  • Identify the competition: Research the existing restaurants in your local area. Consider the types of cuisine, the price range, and the target audience. You can visit their websites, read online reviews, and talk to locals to get a better understanding of their strengths and weaknesses.
  • Determine the target audience: Who do you want to attract to your restaurant? Consider the age range, income level, and lifestyle of your potential customers. You may want to create a customer profile to help guide your decision-making.
  • Analyze demand: Research the demand for your restaurant’s concept. Consider factors such as local eating habits, the availability of similar restaurants, and the willingness of locals to try new cuisine.
  • Assess market trends: Keep up to date with the latest food trends and popular dishes in the local area. This will help you create a menu that appeals to your target audience.
  • Consider pricing: Determine the average prices for similar restaurants in the area. Consider the cost of ingredients, rent, and other expenses when setting your prices.

By conducting thorough market research, you can gain a better understanding of the local food industry and create a restaurant that meets the needs of your target audience.

2. Create A Business Plan: 

Creating a business plan is an important step when starting a small local restaurant. Your business plan should outline your vision, mission, target audience, menu, pricing, marketing strategies, and financial projections. Here are the steps to follow:

  • Executive Summary: Write a brief overview of your restaurant concept, goals, and objectives.
  • Business Description: Provide a detailed description of your restaurant, including the type of cuisine, ambience, and target audience.
  • Market Analysis: Detail the research you conducted on the local food industry, competition, and demand.
  • Menu and Pricing Strategy: Outline your menu and pricing strategy, including the cost of ingredients, labour, and overhead.
  • Marketing and Sales Strategy: Describe how you plan to attract customers to your restaurant through marketing and advertising.
  • Management and Staffing: Detail the management structure and roles of staff in your restaurant.
  • Financial Projections: Provide a detailed financial projection of the startup and ongoing costs, including sales and revenue.
  • Funding and Investment: Detail the funding sources you plan to use to start your restaurant, including loans, grants, and investors.

By creating a business plan, you can better understand your restaurant concept, market, and financial projections. This will help guide your decision-making and increase your chances of success.

3. Secure Funding: 

Securing funding is an important step when starting a small local restaurant. Here are some ways to obtain funding:

  • Personal savings: Consider using your savings to fund your restaurant. This may not be sufficient to cover all startup costs, but it can be a good starting point.
  • Loans: You may consider applying for a business loan from a bank or credit union. These loans typically require a business plan and financial projections.
  • Grants: Look for grants that support small businesses, especially those in the food industry. Some government agencies and non-profit organizations offer grants to help start and grow small businesses.
  • Crowdfunding: Crowdfunding is a way to raise funds from a large number of people through online platforms. This can be an effective way to generate interest in your restaurant and raise funds.
  • Investors: You may consider seeking investors who are interested in supporting your restaurant. This can include friends, family, or angel investors who are interested in the food industry.

When seeking funding, it’s important to have a clear plan for how the funds will be used and a solid financial projection for the future of your restaurant. You should also be prepared to provide information about your restaurant concept and market research to potential investors or lenders.

4. Choose A Location: 

Choosing the right location is critical when starting a small local restaurant. Here are some factors to consider:

  • Visibility: Choose a location that is visible from the street or has a high foot traffic area. A location that is hidden or hard to find may deter potential customers.
  • Accessibility: Choose a location that is easily accessible by car, public transportation, or foot traffic. Make sure there is adequate parking and that the location is in a safe area.
  • Demographics: Consider the demographics of the surrounding area. For example, if your restaurant specializes in healthy food, a location near gyms, health food stores, or yoga studios may be ideal.
  • Competition: Consider the proximity of competing restaurants in the area. Being located near other restaurants can attract more customers, but it can also increase competition.
  • Rent and Lease Terms: Consider the rent and lease terms when choosing a location. Look for a location that is within your budget and has favourable lease terms.
  • Size and Layout: Consider the size and layout of the location. Make sure it has enough space for your kitchen, dining area, and storage. The layout should also be conducive to the type of restaurant you want to create.

By considering these factors, you can choose a location that is ideal for your restaurant and increase your chances of success.

5. Obtain Necessary Permits And Licenses:

Obtaining the necessary permits and licenses is crucial when starting a small local restaurant. Here are some of the permits and licenses you may need:

  • Business License: You will need a business license to operate a restaurant. This can be obtained from your local city or county government.
  • Food Service Permit: You will need a food service permit to serve food to the public. This will require an inspection of your restaurant by the local health department.
  • Alcohol Permit: If you plan to serve alcohol, you will need a separate alcohol permit. This may require additional inspections and fees.
  • Sign Permit: If you plan to put up a sign for your restaurant, you will need a sign permit from your local government.
  • Building Permit: If you plan to make any renovations or changes to the building, you will need a building permit. This may include changes to the kitchen, dining area, or exterior of the building.
  • Music License: If you plan to play music in your restaurant, you may need a music license. This will depend on the type of music and how it is played.

It’s important to research the specific permits and licenses required in your local area and apply for them before opening your restaurant. Failure to obtain the necessary permits and licenses can result in fines or the closure of your restaurant.

6. Hire Staff: 

Hiring staff is an important step when starting a small local restaurant. Here are some steps to consider:

  • Determine your staffing needs: Consider the roles and responsibilities that need to be filled in your restaurant, such as cooks, servers, bartenders, and managers.
  • Create job descriptions: Write job descriptions for each role that outlines the qualifications, responsibilities, and expectations.
  • Post job openings: Post job openings on job boards, social media, and on your restaurant’s website. You can also use recruiting agencies to help you find qualified candidates.
  • Interview candidates: Conduct interviews to assess the skills and experience of each candidate. Ask questions about their previous work experience, availability, and customer service skills.
  • Check references: Check the references of the top candidates to verify their work experience and qualifications.
  • Hire and train staff: Hire the best candidates for each position and provide thorough training to ensure they are familiar with your restaurant’s policies and procedures.
  • Develop a positive work culture: Develop a positive work culture that promotes teamwork, respect, and open communication. This will help to create a positive work environment and retain staff over the long term.

When hiring staff, it’s important to find individuals who are passionate about the food industry, has a strong work ethic, and are customer-focused. By creating a strong team of staff, you can provide a positive experience for your customers and increase your chances of success.

7. Create A Menu: 

Creating a menu is an essential step when starting a small local restaurant. Here are some steps to consider:

  • Define your concept: Before creating your menu, define your restaurant concept. Determine what type of cuisine you will offer, the style of the dishes, and the overall theme of the restaurant.
  • Research the competition: Research the menus of competing restaurants in the area. This will help you to differentiate your menu and create unique dishes that stand out.
  • Choose your dishes: Select a variety of dishes that fit with your concept and will appeal to your target audience. Consider offering vegetarian or vegan options, gluten-free options, and dishes that cater to different dietary restrictions.
  • Test your dishes: Once you have chosen your dishes, test them out to ensure they are high quality and well-received by your target audience. Consider hosting a tasting event or inviting friends and family to sample the dishes.
  • Price your menu: Determine the cost of each dish, including ingredients and labour, and set a price that is competitive and profitable.
  • Design your menu: Design a menu that is visually appealing and easy to read. Use high-quality photos of your dishes and consider using creative names for each dish.
  • Update your menu regularly: Keep your menu fresh and updated by adding seasonal dishes or specials. This will encourage repeat customers and keep your menu interesting.

When creating your menu, it’s important to focus on quality, uniqueness, and value for the customer. By offering a menu that stands out and caters to the preferences of your target audience, you can create a successful restaurant that thrives over the long term.

8. Market Your Restaurant:

Marketing your restaurant is essential to attract customers and generate buzz around your new business. Here are some steps to consider:

  • Develop a brand identity: Develop a brand identity that reflects your restaurant’s concept and style. This includes your logo, colours, and overall design aesthetic.
  • Create a website: Create a website that showcases your menu, location, hours, and contact information. Make sure your website is mobile-friendly and easy to navigate.
  • Use social media: Use social media platforms such as Facebook, Instagram, and Twitter to promote your restaurant and engage with your customers. Post photos of your dishes, specials, and events to keep your followers engaged.
  • Partner with influencers: Partner with local food bloggers and influencers to promote your restaurant on their social media channels. This can help to increase your exposure and attract new customers.
  • Host events: Host events such as wine tastings, cooking classes, or live music to attract customers and generate buzz around your restaurant.
  • Use local listings and review sites: List your restaurant on local directories such as Yelp, Google My Business, and TripAdvisor. Encourage your customers to leave reviews and respond to feedback professionally and positively.
  • Offer promotions: Offer promotions such as discounts or free appetizers to attract new customers and encourage repeat business.

Marketing your restaurant requires a combination of online and offline efforts. By developing a strong brand identity, creating a user-friendly website, and using social media and local listings, you can attract customers and build a loyal following for your small local restaurant.


Starting a small local restaurant is an exciting venture, but it requires careful planning, preparation, and execution. To be successful, you must conduct thorough market research, create a solid business plan, secure funding, choose the right location, obtain necessary permits and licenses, hire staff, create a menu, and market your restaurant effectively.

By taking these steps, you can increase your chances of success and create a thriving restaurant that attracts loyal customers and generates positive word of mouth. Remember to stay flexible and adaptable, and be willing to make changes as needed to meet the evolving needs and preferences of your customers.

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