It’s the most wonderful time of the year in New York City--and we’re not talking about Christmas. NYC Restaurant Week is in full swing, when the best eateries in town offer discounted lunches and prix-fixe dinners at a bargain. But in between courses and savory bites, you might find yourself thinking: Hey, why don’t I open up a restaurant of my own?!
Before you start getting fitted for a chef’s hat or picking out industrial light fixtures for your dream corner bistro, make sure you’re building a business that has the potential to serve delicious meals and delicious profits.
“Some think that just because they’re a great cook or a hospitable host, they’re ready to open a restaurant, but you also need solid acumen as a businessperson,” says Andrew Rigie, executive director of the New York City Hospitality Alliance. The association represents restaurants throughout the five boroughs and tracks industry news and trends.
Obvious steps--like locking in the concept (fast casual or shooting for the Michelin stars?), name and location--may sound fun. But in the guide below, Rigie lists the specific requirements that every aspiring New York City restaurateur must know. While the details may be daunting, Rigie says: “If working in a restaurant is in your blood, in your DNA, then focus on mastering some skills.” Once you do, you’ll want to be part of the hospitality industry for life.
The Ultimate Guide to Opening a NYC Restaurant
Make sure you have worked in a restaurant. Life as a restaurant owner is not as glamorous as it looks. Expect to spend a lot of time in the basement doing inventory. You’ll be putting out fires (sometimes literally!) and working nights, weekends and holidays. Know what you’re getting yourself into by working different jobs and roles within the industry.
Hire experts to understand the daunting world of restaurant regulations, laws, permits and licenses. Hire an attorney that specializes in NYC restaurants, as well as a separate employment lawyer who understands the city’s labor laws. “Don’t just hire your sister-in-law or cousin just because they have a law degree,” says Rigie. “The rules and regulations are much too complex to take any risk.”
Win over investors--and the Community Board. Before you write a business plan and present it to investors, get to know the neighborhood first. This requires much more than a walking tour and hobnobbing with other shop owners. You must familiarize yourself with the local Community Board. Most restaurants need a liquor license which requires a presentation to your Community Board for approval. Some boards will impose restrictions on your liquor license which can affect your business model.
“Presenting to a Community Board can be a shocking experience for first time restaurateurs,” says Rigie. “This points back to hiring the right experts and lawyers who will know what Community Boards want to hear.”
Before you sign that lease... Many restaurants make more money on liquor than food. Before you sign on the dotted line, make sure there’s a stipulation on the lease related to a liquor license. In fact, Rigie advises to not even start investing until you secure the license. “I’ve heard horror stories where owners sign a 15-year lease, invest hundreds of thousands only to learn that the Community Board wants to limit your hours of operation.”
Got gas? Also before you sign the lease, work with Con Edison to make sure your space can receive enough gas pressure to properly cook a large amount of food. This also requires permits as you might have to rip up the streets to install larger pipes.
Make sure your space is compliant with the Americans with Disability Act (ADA). That historic millinery in your neighborhood may have been beaming with potential as the location for your new restaurant. But the truth is, many old buildings in NYC are not ADA compliant. For instance, it may feature a single restroom downstairs or too many entryway steps. This can result in multiple lawsuits. Keep in mind that if you decide to build a restroom on the first floor, this can remove 3 dining tables from your floor plan and disrupt your earning potential and business model.
Establish a web presence to connect with your customers.
Having a professional website is tantamount in the digital age, especially when you’re operating in a city that sees more than 65 million tourists each year. “Customers love to look at food, so images of your menu and venue give people the opportunity to connect emotionally to your restaurant, before they even step inside,” says Rigie. Work with a web designer or use a template within Wix or Squarespace to build the site. When it comes to finding the right web address for your restaurant, keep in mind that any business within the five boroughs can register a .nyc domain name. It’s a great way to support local SEO and showcase the value of your restaurant’s NYC location. // This will also give your business an air of officiality and legitimacy as an eatery operating in The Big Apple.
Make your website is user friendly. It should clearly list the address, phone number, menus and reservation options. Just like your brick and mortar, make sure your website is ADA compliant for the visually impaired.
Get savvy with social. In addition to posting aesthetic images that entice your customers to visit, make sure your social media accounts redirect to your .nyc website. Find an authentic voice that keeps the community updated with specials and events. Posts can even feature information about your chef, manager or the restaurant’s star bartender. After all, restaurants are about so much more than food.
Be overcapitalized. Writing up a menu, purchasing equipment and dreaming up interior design plans may sound fun but at the end of the day, getting your hands on licenses and permits, as well as completing construction, will usually take a lot longer than expected. Weeks before your first customers pay their first bill, you’ll still have to spend on all the above as well as hire staff. To avoid burning through cash, Rigie advises that you build a hefty bundle of capital to get you through any delays.
Start hiring. Bring on professionals with experience in the food industry. Equally important: make sure you invest in a good employee handbook and train your management on employment laws. You as the owner can face major penalties and lawsuits for minor violations.
Get friendly. Not just with your customers but other restaurant owners with experience and who are in the trenches with you. Joining industry organizations like the NYCHA will come in handy. Not only will this help you keep up with everchanging news, trends and regulations, it will allow you to connect and exchange ideas with other creative restaurateurs who’ve cracked the code on how to thrive in New York City.