Opening a Restaurant Checklist: All You Need to Know (+Download!)

There’s so much to think about at the beginning of any new business, but opening a new restaurant is its own special recipe. From the business plan to the location to licenses, the pile of pressing tasks can seem overwhelming. If only there was a free, downloadable ‘opening a restaurant’ checklist to help you get started…

Not to worry—we made one! We know that people want great places to eat out, and that you want to make that happen. We made the ultimate opening a restaurant checklist so you can spend less time thinking about the details and more time thinking about oxtail. You bring your passion, and we’ll bring what you need to know about the restaurant startup process—and, of course, a downloadable checklist to get you started. Good deal?

What to expect when opening a restaurant.

Entering the restaurant industry can be a dream come true. Whether you’re hoping to build a tight-knit team of fellow foodies, bring joy to your customers, or being your own boss, there’s a lot to recommend the idea of restaurant entrepreneurship.

But restaurants are famously precarious businesses. Up to 80% of restaurants have trouble making it past the first five years of business. Success in this fast-paced and competitive field means following a careful plan for opening, growth, and profitability.

Vision alone won’t see you through the good, the bad, and the ugly of starting a restaurant. Foresee bumps in the road and set yourself up for long-term success with strategic planning. (That’s where our checklist comes in!)

Steps to opening a restaurant.

From the first spark of a restaurant idea all the way through to opening day and beyond, here’s everything you need to know going into your new venture.

1. Choose your restaurant theme, concept, and identity.

The beginning of your new restaurant starts with imagination. Put yourself in the perspective of someone deciding where to eat, and choose a unique concept that’s going to appeal to them. Take this first flash of an idea, then put pen to paper (or fingers to keyboard) and ask yourself:

• What will this restaurant look like?
• What style of food and drinks will you specialize in? 
• What service style will you offer? A full-service restaurant? A grab-and-go counter service place? 
• Will you source ingredients from local farms or opt for wholesale vendors? 
• How will this restaurant express who you are and what you stand for? What will your mission and core values be?

Let the ideas flow—you’ll find that they’ll narrow down as you write or type them out. Again and again, this groundwork is going to help you out down the road.

2. Do your market research.

Next comes a biggie: your all-important market research. Take a look at the demographics of the place where you’re planning to do business. Find out what sorts of people live there, considering things like age, income level, and dining preferences. 

Ask yourself to what extent your restaurant will appeal to those groups—creating hypothetical buyer personas is a good idea. Think about what dining experiences are missing in your area and what the competition is. This step will probably take a few weeks, but the more detailed your market research is, the more likely you are to reach a receptive target market. 

3. Write a restaurant business plan.

All successful restaurants rely on a key planning document called a restaurant business plan. This is a written document that lays out your long and short-term goals and your plans for achieving those goals. It’s super helpful not just when it comes to finetuning your ideas, but also when you’re seeking investor funding.

A complete restaurant business plan will include:

• an executive summary
• a detailed restaurant description, including design and location
• market analysis research
• a sample menu
• a breakdown of your business structure and staffing needs
• your planned takeout and delivery options
• your marketing strategy
• your financial projections
• a plan for your restaurant’s website

4. Pick a restaurant location.

Scouting for the right restaurant location goes hand-in-hand with market research as a top priority. You need to make sure you’re choosing the right place for your business. Consider factors like:

• proximity to your customer base
• competitors in the area
• visibility and accessibility by cars and pedestrians
• labor costs in the area
• local regulations determining what types of businesses can operate there
• if you’ll be able to get the needed permits and licenses

You can build, buy, or lease a space depending on how much capital you have, but it all comes down to choosing a location that hits all these marks.

Tip: Neighboring businesses, or even the previous owners or tenants of the building, can give you important insights if you ask around. 

5. Secure your restaurant funding.

Knowing how much it costs to open a restaurant and getting the funds you need is next on your list. The cost is going to depend on factors like the type of restaurant, your service style, your location, and the size of your team.

You’ll need to create a budget for license and permit fees, inventory and equipment costs, building renovations and repairs—think plumbing and electrical issues—team salaries, and recurring costs like hiring and marketing.

Restaurant startup costs range from $175,500–$750,500, according to a recent survey. Most people aren’t coming up with this amount on their own, but securing some form of outside financing. Before you seek funding, go through and understand the different options that exist:

• A commercial loan directly through a bank. These give you lower interest rates and access to higher amounts of capital. You need a high credit score to qualify.
• A business line of credit. These function similarly to a credit card and are ideal for smaller expenses. Interest only accumulates as you use the money.
• A small business loan. These help entrepreneurs finance their restaurants in the short term. You’ll need to put up collateral and give yourself enough time to get approved.
• Funds from independent investors. An investor or company will provide a sum of money in exchange for a percentage ownership stake.
• Grant funding. You may be able to secure funds through a non-profit or local government. 
• Crowdfunding. A crowdfunding site like GoFundMe, Kickstarter, or Indiegogo can be a great platform to raise money for your startup costs.
• Family and friends. People from your personal circle who believe in you can pitch in as you get on your feet. If you go this route, be sure to stick to a policy of transparency and regular financial updates.

6. Choose a business structure.

Figure out which type of legal business structure you should use. This is the first of a series of steps you should do with a legal expert (ideally with restaurant experience) and a tax advisor to advise you. With their help, decide which structure makes the most sense for you.

The most common business structures are:

• sole proprietorship
• partnership
• LLC

7. Name your restaurant.

This can be a hard one: choosing a name that’s memorable enough to stand out, yet descriptive enough to communicate your concept without being a mouthful. Your restaurant is your baby, after all—the end product of years of dreaming—so you want to get this part just right.

Your chosen name needs to be available for registration in your state, so check with the Secretary of State’s office to make sure it’s not already registered by another business. If you’re concerned about the rights to use the name nationwide, you could consider trademark registration with the United States Patent and Trademark Office (USPTO).

8. Register your business.

Next up: legally form your restaurant business. 

Most states require you to register with the Secretary of State’s office, a Business Bureau, or a Business Agency. Look up your state to check. Register under your unique business name and as the kind of legal entity you chose when deciding your business structure.

Federally, as of January 1, 2024, every small business owner who owns one or more restaurants through a legal entity needs to file a beneficial ownership information (BOI) report with the Financial Crimes Enforcement Network (FinCEN).

9. Get federal and state tax IDs.

To start operating as an official business, you’ll need to get an employer identification number (EIN), which is used for tax purposes. It’s free to apply through the IRS. Once you have your EIN, you’ll be authorized to hire people, set up payrolls, pay federal taxes, open a bank account, and apply for licenses and permits.

The process to get a state tax ID number is similar, but it will vary by state depending on whether small businesses pay state taxes. Look up your state to find out.  

10. Open a business bank account.

Once you’ve legally formed your business with an EIN, it’s time to set up the business checking and savings accounts you’ll be using for your restaurant. Things are starting to get real!

11. Apply for licenses and permits.

Now get the licenses and permits you’ll need to legally operate your restaurant. Some required licenses include: 

• A business license. This lets you legally operate in the country and will vary in cost depending on your state. 
• A food service license. This lets you legally serve food at your restaurant and is dependent on an inspector visit.
• A liquor license if you plan to serve alcohol. Research your state’s liquor laws, submitting the required documents and paying the established licensing fee.
• A certificate of occupancy. This states a legal use and/or a type of permitted occupancy of a building.

This step is a complex one with long wait times, so check the FDA regulations in your state, and consult with your legal counsel to make sure nothing’s overlooked.

12. Decide what payment methods to accept.

Over 40% of customers will abandon their purchase if their preferred payment method isn’t available (among Millennials, the number is even higher). As a restaurant owner, choosing the right payment methods for your business is an important decision.

Look into the pros and cons of each of these methods before deciding which are right for you:

• cash
• credit and debit cards
• EFTs (electronic funds transfers)
• mobile payments
• gift cards and restaurant credit
• custom payments (split payments, split tender, loyalty programs)

13. Hire your restaurant team.

As anyone in the industry knows, restaurants are people-based as much as they’re food-based. As a restaurant owner, the way you build and lead your team is some of the most valuable work you’ll do.

It’s your job to vet every single role, from bartenders to sous chefs to servers. If you find and train skilled, committed people from the get-go, you’ll create a smooth-running team with high motivation and low turnover: people who’ll stay on board for the long haul. 

14. Invest in restaurant equipment and technology.

Get ready to make a long list. Your menu—which you created when you made your business plan—will help you shape your back-of-house equipment list. Consider each of the following:

• kitchen prep and cooking (ovens, grills, refrigerators, ice machines, etc.)
• cooking utensils and tools
• dishwashing station
• service items (trays, condiment holders, etc.)
• disposables
• bar equipment

When it comes to restaurant technology, it’s best to optimize your team’s processes from day one. You’ll be able to serve more guests, capture more upsells, get more tips, and save on labor dollars if you invest in the following pieces of tech:

• POS system, including handhelds
• labor management software
• online ordering system
• QR codes
• waitlist & reservation systems

15. Plan your restaurant’s layout.

Time to have some fun and make something pretty—and functional. With a design professional’s input if you can swing it, thoughtfully plan out both your front-of-house and back-of-house layout. Consider these factors when designing your restaurant or bar:

• seating capacity
• accessibility
• lighting, decor, and furniture that ties into your concept
• restrooms, storage, and cleaning 
• functional food prep and cooking space
• dry and cold storage 

16. Set up the kitchen and serving areas.

When setting up your kitchen and serving areas, it’s all about striking a balance to maximize space efficiency, allow for a smooth workflow between the prep and service stations, and meet health and safety regulations.

It’s always a good idea to get input from experienced restaurateurs, as well as the team members you’ve already brought on board who’ll be using these areas.

17. Set your restaurant’s budget.

Now that you’ve considered everything above, you have a lot of budget decisions to make—and some careful calculations to do.

This is another step that can take a lot of time, and all the questions can feel overwhelming. Can you afford design help? Are you going to have to use more wholesale suppliers than you first thought? Does it make sense to buy some of your big pieces of equipment pre-owned? 

Budget carefully and thoroughly—it’s worth it. Both to keep your costs under control, and to reduce uncertainty and stress later on. 

18. Set up your restaurant payroll.

The paperwork for your restaurant is a lot more than just wages and tips. If you’re setting out to run payroll for your restaurant for the first time, following these steps will make the process a whole lot easier each pay period:

• complete the right legal paperwork for your business structure.
• form a payroll schedule.
• calculate payroll taxes.
• calculate the cost of labor along with gross and net payments.
• safely store your payroll records.

19. Get business insurance. 

When insuring your new restaurant business, it’s a good idea to find an insurance broker specializing in commercial coverage. They’ll be able to assess your needs and give you quotes for policies that include general liability, property insurance, and workers’ compensation.

20. Create your employee policies and handbook.

Your restaurant employee handbook is going to be your team’s go-to guide for matters big and small. When someone forgets how to request time off, being able to refer to the handbook can save you both time and effort.

A well-written handbook clears up confusion, prevents misunderstandings, and frees you from constantly answering easy questions.

21. Automate your processes with time tracking, POS, accounting and payroll software.

To stay on top of scheduling snags and inflated labor costs, choosing good time tracking software for your restaurant team is an important next step on your list. The ability to build, share, and optimize schedules is going to seamlessly keep everyone on the same page in a way that a manual system won’t.

Even better? A scheduling platform that’s an all-in-one, POS-integrated team management tool. Automating your payroll, admin and HR processes from the beginning will keep everything in one place, cut down on paperwork, and avoid mistakes in your accounting.

22. Market your new restaurant.

Now it’s time to create a marketing plan and start spreading the word about the amazing restaurant you’ve brought to life! Make a strong website and set up social media channels, pulling details from your business plan. Make sure you’re speaking directly to your target audience, using strategies like:

• content marketing (videos, blogs, reels)
• email marketing (newsletters, email campaigns)
• boosted social posts (Facebook, Instagram, LinkedIn)
• review sites (Google, Yelp, OpenTable, etc.)
• food delivery/order apps (Uber Eats, DoorDash, etc.)
• collaborations (food festivals, pop-ups, special events)

23. Host a soft opening and grand opening.

Time to test your concept. A soft opening is an opportunity to work out any kinks, not to mention take a moment to celebrate with your core team.

When it’s finally time to pop the champagne—drumroll, please!—host a grand opening as your first big marketing effort. With all the careful planning and strategizing you’ve done up to this point, you’re ready to start serving up deliciousness and earning people’s loyalty.

Opening a restaurant checklist: make your dream a reality.

Ready to start polishing your ideas till they shine and begin your restaurant journey? Here’s every step you need to follow in a handy one-pager.

Download our free checklist here: Opening a restaurant: the ultimate checklist PDF

From building a team to opening your doors (and beyond), Homebase is here for you.  

At Homebase, we know how much restaurant owners have to juggle, and all the hard work you’ve done to get here. We’re proud to be a trusted tool for restaurants of all sizes—helping make everything from staffing to scheduling to payroll to team communication easier for restaurant owners.

Ready to grow your dream team with our easy-to-use, all-in-one employee app? Get started for free with Homebase.