You never thought you’d Google those words in earnest. But after everyone raved about your coq au vin last weekend you know you have to. “If not now, when?” you think. Looking at all the results you realize you don’t know how to finance your restaurant.
If you’ve been wanting to finance your dream restaurant, read on.
Customers get overwhelmed with too many choices. Start small.
Keep Your Menu Simple
The first thing you have to do is decide on a menu. If you have a few ideas in mind, great. If not, we recommend keeping things simple and small.
We know how excited you are. Starting your own restaurant means you can cook anything you fancy – from great French dishes like coq au vin to your grandmother’s famous baked BBQ chicken.
“The more I offer, the more choices people have, right?” Seems like a good idea in theory, but not so much in practice.
In fact, offering a lot of menu items can overwhelm your customer. Psychologists Sheena Iyengar and Mark Lepper published an interesting study in 2000. In the study, a table of jam samples was set up in an upscale supermarket for two days. On the first day, 24 different samples were offered along with a $1 discount coupon if they chose to buy a jar. On the second day, only 6 different samples were offered along with the coupon. What happened next is really interesting.
Why Simple Works
While people were more likely to sample the jams when there were more jams to sample, they were less likely to buy. When there were fewer jams to sample, shoppers, sampled less. However, the shoppers that did sample were more likely to buy. What the psychologists concluded was that the more options people have, the more overwhelmed they’ll be.
This is why a simple menu works. People can quickly choose a menu item instead of sifting through the pages unsure of what to order. The hidden beauty of small menus is that you can give each dish the love and attention it deserves.
Yes, You Can Add Dishes
“What if I want to mix it up later?” We’re not saying you can’t. In fact, it could be a good thing.
Maybe you could have a “special” of the month, something you serve only one month and not after. It will bring people to your restaurant wondering what the special is. Plus, you can keep things festive for the holidays. Like a roasted turkey dish for November or a nice slow-cooked brisket for Hanukkah or Christmas.
Just be sure you’re not over-expanding your menu, and patrons will want more.
Start out with used equipment and upgrade as needed.
Research Your Equipment
Now that you’ve got your menu down pat you can research your restaurant equipment. This means taking stock of what plan to serve and basing your restaurant equipment loan off that. If you’ve worked in the restaurant industry before you might already have a good idea of what to finance. But if you’re new, check out our page on restaurant equipment financing for a list of kitchen essentials.
Now if you’re concerned about price, don’t be. You can always finance used restaurant equipment to start and upgrade your restaurant later as needed.
Draft a Business Plan
This is important. A business plan shows potential financiers two things: 1) That you are serious and 2) that you understand what your resources are and what you need to borrow. If you’re unsure how to write a business plan for your restaurant equipment loan, check out Entrepreneur.com. It has a lot of information about the usefulness of business plans and how to write one.
Consider Alternative Financing
When it comes to financing there are a lot of options to consider. However, there’s a solid reason we keep recommending alternative financing. They’re more open.
See, only banks like to help businesses if they’re already established and making money. If you’re a new restaurant with bad credit, a bank might not work with you. Alternative financiers look beyond your credit score. They look at your business plan and gumption to craft a financing plan that works for you.
Get the Restaurant Equipment Financing You Need from First Capital Business Finance!
If you need restaurant equipment financing for your restaurant, speak with the financial experts at First Capital Business Finance. It just takes a few minutes to get pre-qualified over the phone! Simply call us at888-565-6692 or click below to finance your future.
First Capital Business Finance is committed to helping you meet your cash flow needs to grow your business. We serve small and middle market businesses and large corporations with range of loan and financing options