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The cost of developing a restaurant concept is typically the most common question asked. Unfortunately there is no one answer to that question.
The simplest answer would be U$ 10K to U$ 250K. A lot depends on the complexity of the concept, what exactly is involved, If there is a base concept or idea as a staring point that is clear an concise, and there is an initial business model that works, then the project starts with a good foundation, and considerable extra time and cost can be avoided, as one can go right into the actual defining of the concept.
The fundamental parts of a concept are:
- What is the concept about? Is it fundamentally a place where customers go for a great food experience, or is the food secondary, such as in a theme restaurant or bar (although if this is so, it is not an excuse for bad food). Will the concept have a lifestyle branding developed? if one work with a large branding company, costs associated with this development can be high. If the ownership has clear ideas, this can be done internally with the help of graphic designers, and a good clear starting point can be defined before it goes to marketing, architects, interior designers, etc..
- Has the base menu been developed and tried. A lot of time and money can be spent in the menu development, especially when a large team are involved, and there are many opinions, and not a clear message from the leadership of where they want to go. Currently most successful concepts have simple clear menus, with comprehensive categories that can satisfy a broad base of customers. If one takes the example of concepts like Chipotle in the fast casual category, or the Bandera/Houston in the casual dining category, their menus fit on one page, are well though out, and above all, executable with high quality and consistency, and do not require high skills to make this happen. We have done concepts where this process can take a month or two, and be done with a very manageable budget.
- Third, with a concept and a menu, now it is possible to define the restaurant model, the serve format, the throughputs, and create a model, in which one can simulate different scenarios, which will allow for the defining of the size, cost, initial layout, location, sales distribution through day, average sales ticket, P/L simulations for different types of location, sizes, investments.
- Fourth: Economic model can now be made, with good estimates for food cots, labor costs, overheads, etc.., Budget build out costs, and returns on investment under different conditions.
At this point, a very comprehensive investor presentation can be made, and also a landlord presentation for prospective sites.
- Fifth: Create the concept based on:
- Real estate and demographics as defined
- Schematic layout of restaurant done, and be able to apply this to specific locations
- Branding and Marketing
- Start-up team, management, operations, culinary, construction, accountig
Six: Make it happen, build the first unit, start it up, evaluate its performance, adjust based on
sales, customers preferences, costs, execution challenges.
- Adjust the concept that was developed based on what has been learned,
How much does this cost? Again, it depends on how much the prospective customer has done, will do, and how much external help is needed.
At Maverick we have the team and the flexibility to adapt to a customers needs and preferences, We can develop the whole project (using our team of associates), or we can work with the customers in the areas they feel they need help.
The restaurant business can be extremely profitable and successful if executed right. Many projects we see around us, are badly done, incorrectly structured, based on a whim or an idea that is not well developed.
Many of the ones we have worked on have been very successful.