One of the biggest reasons restaurants fail is because there was never really enough capital to start the restaurant in the first place. If you are planning to open your restaurant, you will need enough capital to start up and then enough money to cover about two to three years of expenses because this is usually about how long it will take before you start making any real profits.

For now let’s just focus on the restaurant start up costs – money you’ll need to go from the idea stage to actually opening your restaurant. These costs can vary depending of the style of the restaurant, location you have chosen, and the type of cuisines offered. It can range between one hundred thousand dollars and three hundred thousand dollars depending on where you live, what type of restaurant you’re opening, and a variety of other factors.

From the outset you’re going to shell out money to get all the proper licenses and permits. Then you’ll also have to either spend a good chunk of cash on slightly modifying a place, completely renovating a space, or absolutely starting from scratch. Obviously, the more you want to do to the space then the more money you’ll have to spend.

Then you’re going to have to look at the restaurant start up costs to purchase the equipment you need for the restaurant. This includes things like the ovens, stoves, freezers, refrigerators, stations for cutting, heating, and cooling, ventilation equipment, tables, chairs, and possibly bar stools. Of course you may be able to find a place where many of these things are already present. However, even though you’ll be saving money at the outset, you may actually lose money in the long run because places that are fully equipped usually are much more expensive than places that aren’t furnished or equipped at all.

In addition to the items listed above, you’ll also need to buy an outdoor sign, menus, glasses, china, silverware, and many other smaller items. You need to make sure you plan out every little thing you need to get started including things like napkins, light bulbs, and toiler tissue.

Part of your start up costs will also include money for buying point of sale equipment such as cash registers, credit card machines, etc. You will need a way for people to quickly and easily pay for their food (this is how you’ll make money).

You will also need to plan for buying food and drinks, as well any other thing that will be an ongoing expense. Don’t forget to include anything and everything. Any unexpected expense that crops up later will hurt your bottom line and threaten to blow apart your budget. So be very careful.

Restaurant start up costs can be very pricey, The average cost to start up a restaurant is often right around a quarter of a million dollars. In addition, a very common reason why people fail with their restaurants is because they don’t have enough money to shell out for the initial cost of opening the restaurant and then to continue to spend the money to keep the restaurant operating. So just to be sure, always make sure you have the capital to start up the restaurant and then to keep it going for a couple years.

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