HomeGetting Started5 Excessive Expenses Restaurant Startups Should Avoid

5 Excessive Expenses Restaurant Startups Should Avoid

The restaurant industry is mainly run by people who are passionate about food. Not just eating food, but also making and serving amazing food to other people. 

Restaurant startups are the product of such passionate and aspiring restaurateurs who want to share this passion with others. They want to communicate with people through food and want to be the proud owner of the most sought-after restaurant.

Sadly, in the current economic situation, restaurant startups are not all successfully set up and run. A lot of them shut off in the first 6 months!

Sustainability is a struggle and staggering loss and closure become the inevitable end.

However, through some smart budgeting and careful planning & decision-making, all that can be avoided. A common trend which has been observed among such failing restaurant startups is their tendency to overspend in all the wrong places. In their enthusiasm to establish their best dream project, they do not put expense restraints at the right places.

Business Areas Where Restaurant Startups Usually Overspend

1. Interior Decor

Your interiors are the tone setters for your diners. They set the theme for the food as well as the mood and the atmosphere. 

However, the one thing that restaurant startups tend to overspend on is decorating the interiors. What most restaurateurs do not understand is that you do not need to go over the top to beautify your restaurant. 

In fact, today, simple and chic go hand in hand. It is important to remember that a couple of individual elements like bright paint colours, finishes, nice lighting, some inexpensive landscaping and unique upholstery options can make your interior stand out without the need for splurging big bucks!

Apps and websites like Pinterest, Instagram etc. can help give you ideas for decorating your restaurant startup on a budget.

how much can a successful restaurant startup make?
Simple interiors without much ado in a restaurant startup are friendly to the eyes as well as the pockets.

2. Ingredients & Food Products

The second area where restaurant startups can majorly save money and cut down on expenses is food supplies

First-timers or inexperienced restaurant startups overspend on food expenses and poor menu choices. It can be difficult not to overbuy, but there are efficient ways to manage food budgets for startups. With Petpooja’s Inventory Module, you can manage your inventory much more easily and in under 15 minutes. With critical management features like Raw Material Management, Minimum Stock Alerts, Central Kitchen Module and much more, keeping a track of your materials becomes a breeze!

Oftentimes restauranteurs go all out on buying food ingredients without having a word with their chef. Resultantly, an unwanted stock of useless ingredients that not only break their budgets but also get expired over time is gathered. 

You can avoid this by:

  • Allotting the ingredient shopping to an expert
  • Buying items only according to the menu
  • Finding a supplier that fits within your budget and buy supplies in wholesale instead of retail

Petpooja’s Suppliers Hub is a platform that allows you to buy supplies or kitchen equipment from verified suppliers, request for quotations and get access to exclusive deals and offers.

3. Technology

Technology plays a big role in the management and operations of a restaurant. It is recommended to invest in a good POS technology right at the beginning as you start setting up your restaurant.

However, buying good technology does not always mean having to go broke while doing it. You can scan the market for good options and then invest in the one which is most suitable for your outlet and business operations.

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For instance, Petpooja POS provides the standard price of ₹10,000 (including tax) for the PoS system in the first year and a renewal cost of ₹7,500 per year. The standard package includes the entire billing, inventory, CRM, report, online ordering and menu management. There are no hidden or additional charges, no multi-terminal charges, and no customised price depending on the outlet type. Click here to sign up for a free demo!

Waiters are handed tablets to ease operations and keep a standard track of them in a majority of dine-in restaurants. As a restaurateur, you can follow the trend, but at your pace. You don’t need to buy iPads or the best-branded android tablets and assign all servers with them. You can start off by buying a couple of them and then as the process starts getting streamlined, you can start spending more as required.

How do I startup a restaurant with no experience?
Use a POS to organise the workings of your restaurant and regulate operations.

4. New Equipment

Equipment includes everything from cooking machinery to utensils to tableware and cloths & napkins to cleaning supplies and more. 

Second-hand options are a good way to start. It is not always required that you buy everything new. A different restaurant might have shut down and would be ready to sell off its equipment at greatly reduced prices. Take advantage of that.

Shop online and buy only what you need

It is incredibly important to have the right equipment on hand, especially in the kitchen. 

Restaurant equipment financing is another way of getting the professional equipment a startup needs without overspending. A lot of companies offer equipment on EMI and banks offer loans to facilitate such situations. Budgeting for such occasions would be a good way to anticipate the costs and save on unnecessary expenditure.

5. Marketing

In this day and age, marketing is the key to success!

As a restaurant startup, it is even more essential for you to be seen by people at large to get noticed and visited. It is crucial for your startup to be marketed properly to create a buzz around it and ensure customers visit it.

Yet, marketing your restaurant should not be an expensive exercise. You can now market your restaurant for a very little amount across various social media platforms. You can boost posts, run ads and even spread the word through influencer marketing for as little as Rs. 10,000!

There is no need to shell out big bucks on advertising when you are just starting out and are still learning to manage even the most basic expenses.

You can watch our webinar on Affordable Marketing Tips For Your Restaurant here.

You can also use Tvito, our recently launched app which provides you with 50,000+ designs, 20+ cuisines and endless content options readily available to promote your restaurant on various platforms. It is quick and user-friendly and you can generate high-quality content right from your phone!

Use social media to attract customers and raise brand awareness by posting stories and running promotional ads at a low cost.

It is very important to keep some capital in reserve to put towards unexpected expenses, especially for restaurants that are just starting out. Poor budgeting and a lack of planning have resulted in the failure of many restaurants. As long as you create a budget and stick to it, and keep some money in reserve, you’ll be able to handle the unanticipated items that crop up with ease.

Follow us on Instagram for information and updates related to restaurants!

Shanaya Udeshi
Shanaya Udeshi
From being a practicing lawyer to a writer, the only thing that has remained constant about me over the years is my love for food. I talk food, dream food and now even write about food!

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