Most people have a pretty uncomplicated view of how a restaurant gets started. There’s an investor, a building’s lease is signed, there’s interior decorating, you hire staff, and boom! There’s your restaurant. You’re making food. You’re serving guests. It’s all good.
The reality is modern chefs and restaurant entrepreneurs have to bear a lot of burdens in bringing restaurant concepts to life. And when opening a new restaurant, often unspoken is a simple truth: that’s just one way to sell food to people in your area. The flexibility and interest of today’s consumer has paved the way for three unique models for restaurant start-ups that don’t actually involve a physical restaurant, each with their own advantages and drawbacks to consider.
Below are a few of the ways today’s restaurateurs are slamming through the brick and mortar to find success.
Food trucks tend to have much smaller menus than other restaurants, meaning you can streamline the cooking process and you need far less people cooking than on a regular kitchen line. Good thing, because the kitchen space you have to work with is very compact and (hopefully) efficient. Trying out new recipes and adjusting your menu prices is much easier on food trucks compared to traditional restaurants, because you can put up a whiteboard and rewrite your menu whenever it changes.
Did we mention the overhead costs? You don’t have to worry about paying a full kitchen and front-of-the-house staff, or paying for utilities. Those traditional expenses are replaced with buying and maintaining the food truck (and paying a small handful of cooks and money handlers). Still, the base cost of getting a food truck up and running is way lower than starting a restaurant in nearly any permanent space imaginable.
The food truck life isn’t for everyone, however. It’s a very cramped kitchen space, for one. Claustrophobes need not apply. You also need to be okay with keeping your daily menu scaled down to a few items, so chefs who want to make every dish at all times could run into trouble.
You also need to really get to know your community and make good connections in order to know smart places to park the truck on any given day. Be aware: not every community is as open to and welcoming of food trucks. Get up to speed on your local ordinances and contact your local alderman’s office to find out if there are limitations or specific laws that govern the use of food trucks in city limits.
The core conceit of running a virtual restaurant is its delivery-only structure. Orders are still sent in via customers’ computers or smart phones, as one might for any brick and mortar that offers take-out, but the only option for receiving the food is a delivery person. You’ve essentially cut out serving staff and the need to rent a space with a dining room. That can be huge.
As a result, many virtual restaurants participate in kitchen-sharing; for instance, a restaurant (or more than one, depending on the size of the space) will prep and serve a dinner menu in the evenings, while another group will rent out the same space but cook breakfast and lunch menus. As long as everyone respects the space and cleans up properly after each shift, kitchen-sharing can give virtual restaurants the benefits of a professional kitchen without the full rental costs.
Still, there are a few details that must be in place for a virtual restaurant to work. First is organizing your online orders. Many virtual restaurants look to services like GrubHub or Eat24 to handle online orders, especially since they have such strong metropolitan reach for businesses focused on delivery. However, the cost of engaging an external order management vendor is usually between 15 and 30 percent of the total ticket. That can end up costing you more than the convenience is worth, especially if the majority of your orders would come through that system.
One of the biggest appeals of the pop-up restaurant is how little long-term commitment goes with it. Whether you want to open a dining space for a month, a week, or even just one night, you can choose (and advertise) how long the experience lasts. If you decide the concept or menu doesn’t work, you’re not beholden to keep it going any longer than you initially planned. You can move on to the next idea without costing you anywhere close to the money you’d have to invest in a full restaurant.
Be aware that because of the short timeframe, you’re not likely to earn the same potential levels of profits per diem that you might build to in a permanent restaurant. That’s just the nature of the pop-up and economies of scale for equipment and inventory costs that stretch over longer periods of time.
However, if the concept works, you can then use this experience as proof of concept to expand into a full restaurant plan. Even if you have to tweak the idea to fit a long-term business, trying it out in the micro form can help you gain confidence that it’s a doable beyond the pop-up. It can also buoy potential investors on the value you could bring to their money if they were to partner with you full-time.
The Key to Success
For each one of these three set ups, online marketing shifts from very important to absolutely crucial. All three start-ups rely on being able to get your information out there quickly, something that is much harder with traditional advertising. With online restaurants, you don’t even have a storefront of any kind to pull in walking traffic, so signage becomes a very difficult prospect.
Luckily, technology is catching up with these trends. For instance, food truck apps are available to let foodies in your city know you’re nearby. And using social media and your website (focusing on search engine optimization to get strong Google results) will be a big part of making sure your potential customer base becomes actual customers.
No matter what type of restaurant you have, building an attractive website is an absolute necessity. Download our free eBook “The Guide to a Successful Restaurant Website” today to get started: