If you simply love to cook, and especially if you are really good at it, you should definitely consider opening a home-based restaurant business. If you are that one friend that’s always in charge of bringing food and snacks, why not profit off of it? However, if you decide to go down this road, keep in mind that even though you’re doing what you love, a home-based restaurant business is still a business, which means you’ll have to do everything by the books to avoid any legal difficulties and getting in trouble with the law. So, here are some things you’ll need to take care of prior to opening your business to ensure smooth sailing. Pay attention, as this is very important.
Familiarize yourself with the law
The first and the most important step in opening up a home-based restaurant business is getting to know the local laws. This includes finding out about all the rules and regulations you’ll need to follow, obtaining all the necessary licenses and permits, registering your business and determining your tax obligations. So, contact your local authority (most commonly the city hall) and get the information about paperwork and the right office to visit in order to file that paperwork. Next, contact your local health department and file for a health permit. Also, register your business either as a sole proprietorship or LLC, whichever option suits you better. Further, check your zoning laws, because sometimes even though the government gave you their seal of approval, local zoning officers might say otherwise.
Make sure you inspect the market
All the permits and licenses in the world won’t be enough if there’s no room for your business on the market. Therefore, make sure you inspect the market to see if there’s any point in opening a business of that sort in the first place. There are numerous ways you can do the market research, but keep in mind that, since you’re running a food-based business, you’ll need to also test the interest in your products so that you can respond to your potential customers’ needs. So, what you can do is determine your target audience and make small batches of your products you can sell to your local retailers to determine the interest in what you have to offer before you actually invest in the full-blown business.
Get the right equipment and hire professionals when needed
Next, you need to understand that starting any business will require some investment up front. For example, you can’t expect your 20-year-old stove to take on such a workload running a restaurant entails. That’s why you need to invest in proper equipment first. Therefore, invest in high-quality products, such as the Dacor Renaissance series, that guarantee top performance at very affordable prices. Also, you need to understand that your workload won’t always be the same. Sometimes, you’ll have no work for a few days, while other times you’ll have so much work, you’ll simply need some reinforcement. That’s why you should contact local professionals as see whether some of them would be willing to give you a hand when the need arises, for monetary compensation, of course. Another thing you need to consider is other aspects of running a business, such as finances, marketing efforts, and logistics. Here, you’ll also need to hire the right experts to make sure everything is done the way it should be.
To protect yourself, as well as your business, you should document all the relationships and work-for-hire. So, ask all of your associates to sign a contract with you so that you have everything signed and in writing in case of any irregularities. Also, if you’ve borrowed money from your friends or relatives to be able to start a business, you should also create a document that will state the amount of borrowed money, as well as the terms for repaying your debt.
Create a professional image
Even though you are preparing your goods in the comfort of your own home, probably wearing your most comfortable sweatpants and your favorite oversized t-shirt, you need to create a professional image you’ll present to your audience. So, make sure you have a well-optimized, professionally-looking website, print out some fancy brochures and make sure your business cards contain all the necessary information. You can even do a professional photo shoot of you preparing the food – here, of course, you should be well dressed and polished – which you can incorporate in your website’s gallery. Also, make sure that your product packaging is on point, to avoid coming off as unprofessional or sloppy.
Determine your prices
As in any other industry, determining the prices (and sticking to them) is of the utmost importance. So, research all the comparable products you can get your hands on with ease and determine how much they are going to cost before setting your prices. Basically, you should try to balance your expenses and pricing in order to ensure that you’ll be able to generate a profit. However, if you set your prices too high, people will – more likely than not – avoid your business. Also, do know that buying in bulk is always a better option, so try to do that whenever possible. Finally, create a “seasonal” menu. Not only will this be better for your budget – obtaining the goods that are not in season can sometimes be very difficult and it’s usually very pricey – but it will also work as a unique selling proposition, because your customers won’t get the chance to get tired of your menu as it will be changing with every season. But, do make sure that you have the all-time favorites always on the menu.
So, when starting a home-based restaurant business, make sure that your approach is meticulous, and that you’ve done your homework regarding all the aspects of running such a business to avoid any inconveniences with either the law, your customers or your associates. Also, remember that prevention is the best medicine, so don’t wait for something to go wrong, because if you do, it can have serious consequences.