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Home » Business And Finance Articles » Menu Driven Business Planning

Menu Driven Business Planning

So you want to open a restaurant? Many people come to me with their plans, and ideas after they have decided to build or open a restaurant. It is my responsibility to assist them in their planning process and determine how clearly they have thought their concept through. I ask them to show me a menu, and if their initial response is "I haven't gotten that far in my planning process yet," my response is "You haven't started the planning process yet".

A menu is the foundation of any restaurant; Guests will support or avoid a restaurant for its food. Starting with a preliminary menu is a simple and basic approach to restaurant development. Begin with a menu, and you are light years ahead in the restaurant development process. A menu will tell you and your Guest what you are trying to be as a business, and greatly enhance your chances for success.

I view a menu for content, image and pricing. Content (the actual items on the menu) will dictate service staffing needs, level of culinary experience and type of management required. Who will be doing the cooking, do they have experience in this type of food, and how much are you paying them?

Image is how the Guest will perceive the menu. Menu image helps define the targeted clientele and which other restaurants this operation would be competing with. Are the content and image of the menu appealing to your desired clientele? Pricing helps determine a potential restaurant's competitive placement. Is the pricing for the type of food offered competitive with other's in the market area, and does it permit the ability to manage a profitable food cost? Pricing sets the Guest's expectations in terms of food and service quality. This perception will, in turn, help define appropriate staffing levels. The budgeting process can now begin. Analysis of menu content, image and pricing will tell prospective restaurant operators whether their concept is appropriate for a certain market area.

With a preliminary menu in hand, a prospective operator can target a location that will be convenient and appropriate for their desired clientele. Once a site or facility is selected, sales volumes can be projected based on number of seats, menu pricing and the competitive business analysis. With projected sales volumes, how much an operator can spend to acquire, remodel or build a facility is determined. Leases and/or purchase agreements can now be negotiated.

With a clear menu, competitive analysis, sales forecast and development budget, financing can realistically be sought. A business plan can be derived which, if taken to potential investors will demonstrate what type of return they can anticipate on their investment.

Any restaurant business plan must begin with a menu. A proposed menu provides the basics for many questions that must be answered during the restaurant development process. It creates an image of the restaurant, identifies targeted clientele, and defines the proposed restaurant's competition. A preliminary menu allows a sound basis for business budgeting, tests potential profitability, and dictates the development dollars required for a facility. Most importantly, beginning the business planning process with a menu maintains the focus of ownership on the importance of food and the impact it has on the success of the restaurant.

And here is another random article you might be interested in...

Success Tip #8 - Effective Communication Leads to Business Success

If you want to have a fighting chance in the business world, you'd better be an effective communicator.

Here are three steps that will help you operate as a truly effective communicator.

Step #1. Know your outcome. An effective communicator knows her outcome and states it in the positive.

Step #2. Know where you are in the process. Know if you're moving away from or closer to your outcome. Your questioning and listening skills play an important role in this step for communications awareness.

Step #3. Know your options. Be flexible. If what you're saying or doing isn't producing the results you'd planned, you'd better say or do something else.

There you have it, the Effective Communicator Model.

Let's expand on each of the steps.

Step #1. Know your outcome.

If you don't know where you're going, that's where you'll end up.

Are you clear on the outcome of your communication? What do you want to accomplish? When you go into a negotiation, a sales call or a client meeting, are you clear on your outcome?

Make sure you state your outcome in the positive. We live in a culture that thrives on negative outcomes. We know what we don't want and frame our outcomes accordingly.

What outcome do you want from your negotiation? Do you want to avoid overpaying for the project? The desire to avoid overpaying for the project is an example of an outcome stated in the negative.

Here's how this outcome might sound when stated in the positive. "I will negotiate the best possible price for the project and I will stay within budget."

Work on creating outcomes that are clear, specific and positive.

Step #2. Know where you are in the process.

Become aware of as much information as you can. This is where measurement and testing can provide you with valuable clues. You must have some measuring strategy in place. How else will you determine if your communication or action is producing the desired outcome?

Here's an idea for a simple measuring strategy. Create your own checklist (kind of like a shopping-list for success) before you begin your communication or take an action.

Step #3. Know your options.

Be Flexible. If what you're doing isn't producing your desired outcome, you need to do something else.

Requisite Variety is a term born out of Neuro Linguistics Programming, NLP for short. The theory of Requisite Variety states that the communicator that has access to the greatest number of communications options will usually control the communication.

Science uses the same assumption when it comes to experimentation. Scientists know what they want an experiment to produce. They measure their results and know whether or not it worked. If the experiment works, great, if not, they utilize different options as the basis for their next attempt at success. Come to think of it, that approach would be really helpful in your business networking, client meetings, sales calls, marketing, or in any number of your business activities.

Success Tip - Know your outcome. All three steps of the Effective Communicator Model are important, but if you're really clear on your outcomes and you state them in the positive, you'll find yourself reaching those outcomes more easily and more often.

Copyright 2006 Ike Krieger