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HOW TO OPEN A RESTAURANT | 5 things to know BEFORE opening a restaurant

Updated: Oct 12, 2019

Planning to open up a restaurant?

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Every restaurateur deserves owning a profitable restaurant that does not own them and in this show we talks about restaurant marketing, about managing your restaurant and we would be so much happy to answered your questions and much more.

Today, we will read your letter and answer your question. So let’s get started!

“Hello Hengam a great video! I would definitely be interested in more of your videos and advice. My wife and I also live in Texas and we are in a very beginning stages of owning our own restaurant. I'd love to hear more on the beginning of how you got started leading up to opening day and what you would recommend for us looking to put the dream into actions and what steps to take to properly execute? Thank you!” -Laurens

Many of y'all may know that my husband and I owned a couple restaurants in the San Antonio area. We bought a failing pizzeria in 2014 and in the last five years we tripled our sales with zero prior restaurant experience.

Now that it sounds may be impressive but also it means. It's been intense five years and we've been obsessed with growing our sales.

And that started the whole thing with starting this show because I used to get a lot of questions about how we got to do what we get to do.

So here it is, Lauren's first to say well I'm excited for you and your wife starting this adventure in the restaurant industry.

Let me tell you it's going to be hard but it'll be well-worth that if you're passionate about food and serving people we.

We don’t know what on earth we were doing when we bought our restaurant so here I'm gonna tell you five tips that if I could go back in time and focus on these five things.

I think we would have been in a better place maybe or not so I wanted to share those five points with you.

You have got to get obsessed with your numbers

You got a study to the numbers. You're purchasing an existing restaurant You need to review the numbers. You need that they're going to give you a P&L. Because what you're paying for unless it's an asset purchase.

And asset purchases is that when you're just purchasing the asset which is the oven or the make light or whatever chairs and tables. If it's going to be an asset, purchase it.

However if the what you're purchasing is based on the gross sales of the restaurant and there are a lot of ways that those prices are put out there. One of the main ways is that you divide the gross sales by 2.5 or something like that.

You can look that up but if you're purchasing a restaurant based on the gross sales so this is what we did right;

The restaurant we purchase we bought it for 140,000 dollars and that was based on the P&L

We have received saying whatever it was right so one of the things that it was that we did not know how to study the P&L.

You need to sit down with the owner.

You got to sit down with a broker and the question every single number and don't feel bad if you do not know because the owner is gonna be like “huh you're gonna buy this restaurant and you don't know what blah-blah-blah-blah”.

It doesn't matter you're gonna be coughing over money. You better know every single number you need. If you not look it up before going and sitting down with your owner. Study it, research what it indicates how it's calculated and sit with the owner.

I'm sorry to tell you a lot of times some of the piell's are cooked and I know that's politically incorrect for me to tell or do what it is so for instance you want a things you want to know.

You need to know the standards in your industry so what I mean by that is for instance for us we own vita Ria's so our pizzeria recommended a rate for different things is that the rent needs to be about seven to eight percent and your food and labor needs to be less than sixty percent which is your big prime cost or to variable costs that are very important your food and your labor.

So one of the things again that was happening is that our payroll was awfully a low number. I mean we didn't know what's low, we did not know what's high but it's because the owner was paying people cash not declaring those sales. Not paying proper sales tax on those numbers and all of that.

We did not know what questions to ask.


whatever you're gonna open; a burger joint, is it a barbecue joint? You need to know the standards that are classic for that what you're going to do and match that to the P&L that you've been given to make sure they do match question every single number and that is my first tip!