Start a Restaurant

What is my Company’s Structure?

The corporate structure of your restaurant business is integral to its success because it can affect the environment your company operates in, and even has legal implications that can limit your company’s liability.

Although there are certainly advantages and disadvantages to every corporate structure, an LLC is often the best fit for a startup restaurant. LLC’s protect entrepreneurs from personal liability while simultaneously offering both simplicity and flexibility that are not present in most corporate structures. Corporations require a board of directors, shareholders, and other commercial formalities that can be a hassle for a new business.

What Administrative Regulations Am I Subject To and What Permits Do I Need?

Restaurants must file articles of incorporation, which is relatively quick, and will allow you to acquire a Federal Tax Identification Number which allows your company to properly pay its taxes.

Furthermore, restaurants must meet all the local zoning laws that govern restaurants and also pass the codes enacted by whatever restaurant regulation agency that has jurisdiction within your local area. While these inspections are relatively cheap, they can take up to nine months for acceptance. The acceptance policy includes documentation of counter space, kitchen equipment, and ventilation systems.

If your establishment wants to sell alcohol then it will need to acquire a liquor license which can cost anywhere from a few hundred dollars all the way up to $10,000. Successful restaurants make sure their establishments are up to code and properly secure the regulatory issuances that allow them to legally operate in whatever community they are serving. Although starting a restaurant seems simple in principal, proper planning and adequate time to acquire necessary permits is fundamental to a successful startup.

How Do I Choose Suppliers?

Smaller establishments may be better off utilizing a small pool of regular suppliers in order to streamline processes and establish long-lasting business relationships. When assessing suppliers, remember that price is important but so is quality, safety, and delivery reliability. When evaluating fresh food, always inquire about taking a quick tour of a distributor’s facility paying close attention to cleanliness and adherence to code.

Sometimes the most difficult part of running your own business is attaining financing to maintain and sustain steady growth. This is even true when you are looking for restaurant finance. There is a misconception that restaurants are more apt to fail than any other type of work; a 10% success rate is often quoted.

The truth is that at the five-year mark restaurants have 40% success rates, virtually matching to most other types of businesses. Nevertheless, it can be hard to acquire financing, especially from mainstream sources such as the local bank lender.

Restaurant loans can also be acquired from credit card processing vendors as a factoring agreement. These vendors give funding arrangements that range from a few 1,000 dollars all the way to 250,000 dollars if needed. The business owner is basically selling their future Visa/MasterCard receivables at a discount in order to get the funds they need right now.

The business cash advance is repaid through a credit card receivables based contract. A percentage of credit card receipts are paid back based on a “Daily Capture Rate” that is worked out prior to acquiring the cash which means that during a bad business stretch of time the advance can still be paid without facing delinquency fees.

When you operate a restaurant it can be hard to predict when you will need to have additional funds available. Start up capital can be larger than expected, and the first large mistake can be a “make or break” occurrence. Even if the business owner has excellent credit, it can take a long period of time for a bank loan to be approved; in the meantime, business continues to hurt.

Credit Card Factoring options provide a much needed, quick solution for restaurants in need of cash. Neither collateral nor years of documentation are necessary to be considered for restaurant loans when you work with a proven financing company.

Author: Daniel Samoohi
Article Source: EzineArticles.com
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If there’s one thing restaurant owners can learn from Wolfgang Puck, it’s never to give up. Their journeys to success may not be as extreme as the famous chef/entrepreneur, who began as a cooking apprentice in Austria at the age of 14, then moved to France four years later and “…wrote letter after letter to all the two- and three-star restaurants,” as he told Inc.com, until he was finally hired. For some, it may be as simple as letting go of age-old ideas and traditions and applying for a merchant cash advance when business loans don’t come through. 

The circumstances and stories will differ as greatly as the types of restaurants these small business owners own, but the decision to work hard and adapt to change in order to succeed is what’s important.

If a lack of business funding is the problem, a business cash advance can be the solution. Many merchants that don’t qualify for bank loans do qualify for restaurant cash advances. Virtually, any restaurant owner who has owned his/her business for at least six months, processes a minimum of $3,500 in monthly credit card sales, has no unresolved bankruptcies and has at least one year remaining on his/her restaurant’s lease will qualify for a restaurant cash advance of up to $500,000.
 
Merchants who choose to take advantage of a merchant cash advance for their restaurants have the freedom to use the funds for equipment upgrades, purchases of inventory, expansion, advertising, or anything else they can think of that can potentially improve their businesses. Then, they can renew their funds every three to four months.
 
Choosing a restaurant advance may be the decision that takes your business from good to great. It may be the decision that keeps you from having to close your doors. Get a free online quote today and find out how much you can receive for your restaurant.

Author: Gaston Castro
Article Source: EzineArticles.com
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