How To Cut Costs When Setting Up a Restaurant

It can be incredibly expensive to start a restaurant. By the time you have factored in the cost of buying kitchen equipment, furnishing the dining area, and purchasing stock, it could easily cost you around $100,000 to get to opening night. Cost is the main reason many restaurants fail in their first year. Here are some tips on how to cut costs when setting up a restaurant.

Set A Budget

Before you start, set a budget, and make sure you stick to it. Costs can spiral out of control if you are not strict with yourself. You can always upgrade or buy things you don’t need desperately once you have been established for a while and you have a regular flow of customers coming through the doors.

Rent Rather Than Buy

To keep your initial costs down, it is a good idea to rent equipment rather than buy it whenever you can. There are some fantastic commercial coffee machine rental options as well as deals to be had on kitchen equipment, and even furniture. Renting means that you pay a monthly price rather than having a huge initial outlay, so this can come from the sales you have made month by month rather than having to find money upfront. You can always buy once you have made the money to pay for equipment.

Get a Good Accountant

Hiring a good accountant from the outset could save you a fortune. They will be able to advise you on how much money you will need to set aside to pay various taxes and let you know if you can claim any tax breaks. Many restaurants are popular and well run but they go under once the tax bill arrives and the owners realize that they didn’t set enough money aside to pay it. If you get a good accountant from the beginning, you will avoid getting caught in that trap.

Carry Out Regular Inventories

This will help you to see what is selling well and what isn’t. You can then stock up on your best-sellers and order the minimum of things that don’t sell as well or discontinue this product entirely, which will save you money. This exercise will also prevent you from over-ordering and wasting money that way.

Keep Track of Waste

Keeping track of waste means that you will know what food is popular and what isn’t. It will also help you control the portion size. For example, if you load dishes with a side of chips and a quantity of these are regularly returned to the kitchen, you will know that your portion size is too big. Reducing it will save you money and help you to reduce waste.


Some new restauranteurs make the mistake of spending a fortune on traditional types of marketing because they think they need to use expensive advertising to attract customers. This is no longer true and many successful restaurant brands have been built through social media alone. Get your name out there advertising for free on local Facebook sites and set up a Twitter account. Ask satisfied customers to write a review about your restaurant and post it on social media. You will be amazed how quickly your reputation will grow without you having to spend any money on marketing.

Opening a restaurant may be nerve-wracking to begin with, but it can be very rewarding too. Here are six ways of keeping the costs down when you open a restaurant. Use these and you will be able to turn a profit on your new business venture faster.

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