Profit in Restaurant and Bar Business In India

Introduction to Profit in Restaurant and Bar Business in India (Cost to Start)

People are aware of restaurants and bars as it is trendy nowadays to visit places often. People can visit either with their family, colleagues, friends, and others and enjoy their time taking the food of their taste. Even bars are available in some of the places that offer beverages such as alcohol, drinks, and others to the customers. Operating a restaurant and bar business has become common in present times, and many individuals are opening restaurants for gaining money. It is considered one of the profitable businesses, and after spending money on it, you can start earning within a short duration. You have to search for the right place where you plan for the restaurant.

A Step by Step guide to Restaurant and Bar Business Profit

Moreover, make sure you set up the restaurant in the center of the city so that people will know about it easily. An individual is allowed to start the restaurant in any region of the country, but when planning to open a liquor shop he or she can start in their specific state. Moreover, the person should follow the rules for starting a bar. Before opening the bar, the owner must verify if permission is available to open a bar in that specific state or not. In the article, some of the details have been mentioned that will aid entrepreneurs who are interested to start a restaurant and bar business and gain money from it.

Procedure to Start Restaurant and Bar Business in India

As it is already known that, a restaurant is a place where people have the food of their choice. They can order foods from the menu card provided to them, and the chefs of the restaurant will be cooking. The customers must pay money for the food they take, and in this way, the restaurant and bars will earn money. The restaurants have the opportunity to offer different cuisines such as Indian, Italian, Chinese, Thai, and others. The customers have the freedom to sit in any place in the restaurant. If there are no bar counters in the restaurant, it is called a restaurant. But when it has a bar counter, and drinks are available in the place, it is called as a restaurant and bar business.

Requirements for Starting a Restaurant and Bar in India

With a busy life nowadays people often plan to eat in restaurants and in this way, they try to visit eating joints from time to time. Other than sitting and enjoying the food of their choice, food takeaway services are even delivered by some of the eating joints. Here, you can order the food at the counter and after the food is prepared, you can take it home and enjoy having it at your home. If you are planning to arrange a party at your home, you can order food from the restaurants. Since people should pay for the food which they have ordered, it is only possible for people who can afford such luxuries of ordering pleasant food from the eating joints. Owing to this, it is understood that some restaurants often become unsuccessful as it fails to attract the needed customers who are willing to purchase on a regular basis. Thus, well before setting a restaurant and bar, it is necessary that the individual should research properly and get to know about the situation of the market. It is essential to select an area which is the potential to have customers for the restaurant.

Business Plan for Restaurant and Bar Business in India

When planning for any profitable business, a restaurant and bar is a perfect option. When you are not able to become successful, then you should close the restaurant. The business can be started in clubs, sports bars, pubs, beer bars, and others. The entrepreneur must be careful about the kind of restaurant that he or she desires to open. The business location is very significant in defining the success rate of this type of business. Some other aspects must also be taken into account which is summarized in the next part of the article.

Area or Location Required to Start the Restaurant and Bar Business

The minimum space that is needed to open the restaurant is 1000 to 5000 sq. feet based on the scale of your business.  Moreover, you have to carefully pick the location where you desire to set up the restaurant. Make sure that people in the locality are used to frequent visits to restaurants for dinner and lunch so that they will visit your eating joint. On average, the area required for this business will be 1,000 square feet to 5,000 square feet. To start the business, the place may be a park, hut, or any other open area that will be sufficient to install the necessary tools and equipment.

It is also recommended to start a restaurant in an area where there are many companies and people. The chances of success are relatively more in such areas. People often love to visit eating joints after their working hours. The person must be careful while choosing the area for setting up the restaurant so that the entrepreneur is able to have customers year long. The individual can expect to have more customers while the festive season.

Equipment and Raw Materials Required to Start a Restaurant and Bar Business

The popularity of any restaurant is determined by the quality and taste of food available there. When people are visiting the restaurant at the start, the place should be appealing to the people so that they come over the place repeatedly. Along with tasty goods, the staff of the restaurant must be well trained to deliver top-notch service to the customers. A single complaint about the restaurant can impart bad remarks and reduce the chance of having more customers. In addition to the food, service, it is important to maintain good decorum of the place to have the attention of the people and they could visit the place more than just once. They must feel like they are taking food with their loved ones in a comfy place similar to their home. The seating arrangement must be carefully planned with proper spaces that should be given for each table. People must be able to relax well while they are eating in the place.

In the beginning stage of the business, the owner could use old furniture. Later on, after gaining some money, he can acquire new furniture set up in the restaurant. It is also recommended to obtain furniture on rent rather than using old furniture than old furniture until the entrepreneur is capable to have sufficient money to purchase the new items.

The Profit Plan for Construction of the Restaurant and Bar Business

After buying the raw materials and buying the necessary things, it is time to install them carefully in the restaurant. The service area must be neatly arranged in the eating section. The decorum of the place must set up to ensure that the customers can relish their best time in the restaurant. To attain the attention of the customers, the owner has to select a proper color and theme of the place. Also, the chairs and tables must be placed in such a way that you have adequate space in the restaurant. To get the best arrangements in the restaurant, the entrepreneur should hire an interior designer to have things in the right manner. It will take around, 12 to 15 lakh rupees for arranging things in this way.

The Registration, License, and Permissions for the Restaurant and Bar Business in India

While you set up the restaurant, it is necessary to apply for registration of the restaurant. The individual has to follow the restaurant laws of the country. Some important information on the type of license is summarized below- 

  • License from FSSAI as it is a restaurant business
  • License from the head of the police department
  • Avail license from the state excise department
  • Avail the required shop and establishment license for the restaurant
  • Licenses from local authorities like Municipal Corporation, municipality, and others.
  • Music license if planning to keep a music system in the restaurant
  • Need the no-objection certificate from the fire department
  • Liquor License from the state government website
  • Health/Trade License from state municipal corporation
  • Eating House License
  • Shop establishment license
  • Lift Clearance
  • Certificate of Environmental Clearance
  • Signage License
  • Restaurant Taxation: The Goods and Service Tax (GST)

Hiring the Staff for the Restaurant and Bar Business in India

In the initial stage of running the restaurant, a minimum of 15 to 20 staff is required. It will be needed for the chef, manager, bartender, and others. The monthly salary of the employee in the restaurant will be based on their skills, and it will be almost 4 lakh rupees in a month.

Set a Dress Code for the Staff

After hiring the staff of the restaurant, it is necessary to set a uniform for them. It will make them look smart, and it should be kept in mind that the dress of the chefs must be different from that of the staff who will be serving the customers. For arranging the dress of the staff, the company must allocate 35-59 thousand rupees.

Investment for Starting Restaurant and Bar Business in India

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Investment for Starting Restaurant and Bar Business in India.
Investment for Starting Restaurant and Bar Business in India

It is seen that it takes about 5 – 7 lakh rupees in the starting stage to initiate the business. Additionally, around 2 lakh rupees must be set aside for the kitchen utensils. Also, when the entrepreneur is in preparation to deliver drinks in the restaurant, he must invest much in the business. For construction, you need to invest Rs. 5 lakhs based on the design you choose. Salaries for the staff and monthly maintenance costs Rs. 5 lakhs per month. License and other permissions it costs around Rs. 4 lakhs to Rs. 5 lakhs. So, the total you need to invest Rs. 20 lakhs to Rs. 25 lakhs for starting small scale business.

Profit Margin in the Restaurant and Bar Business in India

You can earn 10 to 15% of profit in the initial stages but later your profits increase based on the quality and standards. You can also attract customers by offering discounts during weekends. So, overall you can expect 35% to 40% profits if you implement different strategies in your business.

Effective Marketing Strategies to Earn Good Profit in Restaurant and Bar Business

When thinking about beginning the business, the entrepreneur has to make a planned marketing plan to prosper in the business. The entrepreneur also must design some logo for the restaurant and seek assistance from a professional or an interior designer to have the best designs. Besides this, the entrepreneur has to print the items for menu purpose, poster, brochure, and other items when launching the eating joint for the first time. The entrepreneur must adopt effective marketing strategies to get the best results.

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