Opening A New Restaurant: Three Key Questions To Answer

Estimated read time 3 min read

The hospitality industry is one of the hardest-hit in the UK, with regard to the successive economic crises that have troubled all sectors. But where many restaurants have been unable to remain open, there are opportunities for new entrants to make their mark on a rebounding industry. If you are thinking about opening a restaurant, there are three questions you should ask yourself first – but what are they?

What Licenses Will You Need?

What Licenses Will You Need

Depending on the specific nature of your new restaurant business, you may need different kinds of licenses to legitimise your operation. A holistic requirement for all new food-based services is to register as a food business with your local council – ideally at the same time as registering your business with HMRC.

However, if you intend to serve alcohol on-premises you will need to apply for a premises license. You will also need to ensure that one of the owners is in possession of a personal license – which enables any staff members on-site to legally serve alcohol.

If you wish to play recorded music for ambience, you will also need a license to do so. This is not a matter of criminal law, but rather civil law; playing unlicensed music is tantamount to copyright infringement.

What Will It Cost?


This is a vital question to ask early on in your restaurant endeavour. There are numerous disparate costs associated with opening and marketing your restaurant, that can quickly mount if you are not paying close attention. Not only that, but the ongoing costs and overheads can render your restaurant’s margin razor-thin.

Addressing costs early will allow you to better plan for emergencies, and better structure your obligations for maximum profit. Hiring staff is an inevitability, and handling their correct and legal payment for services is necessary – and potentially costly for a restaurant too small to justify accounting staff. Investing in HMRC payroll software ensures you can automate these processes, and avoid costly payroll errors.

A close eye on your kitchen costs will also serve you well in the long run. Initial costs will be significant, as commercial kitchen fit-outs are understandably costly. But you can also haemorrhage money in the long run through poor ordering etiquette; if your chefs are ordering more stock than you can sell, your profits can quickly dwindle.

Where Should I Start My Business?

Where Should I Start My Business


The last, and biggest question to concern yourself with relates to the location of your new enterprise. Location is everything in hospitality, as a number of different factors can have profound impacts on the viability of your model and outcomes. For one, central areas receive much higher footfall over a given day, but may also incur much higher rent costs – and may not see that footfall translate into paying customers.

Judiciously choosing premises in a quieter place, and relying on good marketing and word-of-mouth testimonial, can be a much more lucrative plan for independents seeking to provide high-quality dining experiences. If your restaurant leans towards fast or street food, choosing locations near or next to offices and central business districts can work in your favour. There is no one answer for new restaurants, but details are key.

Sarah Cantley

Editorial Head at UK Blog for Business & Startup.

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