10 Essential Steps for Opening a Profitable Fast Casual Restaurant

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Geri Mileva
March 6, 2023
A fast casual restaurant worker is serving a table their burgers and fries.

The North American restaurant industry has long been characterized by two polarizing categories: fast food and fine dining. However, a new category, known as fast casual restaurants, has recently emerged, occupying a middle ground between the two.

Fast Casual Restaurants: An Overview

Fast casual restaurants set themselves apart by providing freshly made, high-quality meals in a casual atmosphere. For efficiency, they often have a counter or ordering system that allows guests to order and pay without waiting in line. Open kitchens are also a common feature of fast casual eateries. These allow diners to observe meal preparation and the skills of the chef. While the food quality matches that of sit-down restaurants, the service remains focused on individuals who are always on the go.

The fast casual industry has experienced substantial growth in recent years, with popular chains such as Chipotle, Qdoba, Five Guys, Shake Shack, and Panera leading the charge. In 2019, the industry was valued at $125.6 billion, and it is expected to reach $209.1 billion by 2027. This impressive growth demonstrates the significant impact and potential of the industry.

A Step-by-Step Guide to Starting a Fast Casual Restaurant

As the fast casual industry continues to grow, many aspiring entrepreneurs are considering opening a fast casual restaurant. If you're looking to dip your toes into this industry, here's a useful guide to follow.

1. Develop a Concept: Have a clear idea in mind

The restaurant industry is competitive and filled with many players, so it’s important to design a unique concept that appeals to local diners. Brainstorm ideas about cuisine, locally sourced ingredients, menu size, and target audience.

Consider how factors like branding, menu, and audience tie together to set the tone for your business. For instance, a vegan fast casual restaurant may cater to health-conscious diners, while a diverse menu can appeal to a more varied audience. Also, take time to craft your restaurant's mission, vision, and core values to capture your brand identity.

2. Conduct Market Research: Learn the ins and outs of the fast casual industry

To set your restaurant up for success, it's crucial to understand the nuances of the industry. Market research is a vital tool that can provide valuable insights on your target audience, competition, and market demand. Understanding your target market allows you to customize your offerings and marketing strategies to meet their specific needs and preferences. Analyzing your competitors can help identify potential areas for improvement, while ensuring that you differentiate your business from your competitors. By assessing the demand for your concept, you can make informed decisions about your restaurant’s operations, ensuring that you invest your resources wisely and target a receptive market.

3. Build a Business Plan: Prepare a detailed business plan that covers all operations

A well-crafted business plan serves as a roadmap for the business's structure and operations. It can also help you rationalize your business goals and secure funding from potential investors. A restaurant business plan should include key components such as a company overview, feasibility study, marketing strategy, business and service model, operational structure, launch plan and timeline, and financial assessment.

4. Choose a Prime Location: Pick the location and get the necessary permits

Depending on your financial situation, you can choose to rent, purchase, or build your restaurant space from scratch. Before finalizing the location, conduct extensive research on the area’s demographics, market, and competition, as well as the physical attributes of the space.

It's also important to consider zoning regulations, parking, and accessibility. The size and location of the space will impact the kitchen design and floor plan, so ensure that any necessary renovations are agreed upon with the building owner, if you will be renting.

People walking through a busy crosswalk, with fast casual restaurants surrounding.

5. Create a Menu: Design a memorable menu that will take a bite out of the competition

Crafting a unique and memorable restaurant menu involves numerous phases, such as meal options, pricing, and design. Work together with your head chef and restaurant manager to brainstorm menu ideas and determine your signature dishes. You should also carefully consider pricing and related factors, like food costs, inventory, and profit margins.

6. Hire the Right People: Build a competent team that you can trust

Your employees serve as the ambassadors of your business. When it comes to building a strong team for your fast casual restaurant, it's important to prioritize hiring candidates who have the right expertise, relevant experience, and exceptional customer service skills. Referrals, job boards, and career sites can all be great resources for finding potential employees. Implementing a consistent onboarding experience, clearly defining roles, offering suitable pay and perks, and properly organizing employee data are other key factors in attracting and retaining talented people.

Learn how Push can help you to streamline your employee management here.

Three fast casual restaurant workers posing together in the kitchen.

7. Purchase Quality Equipment: Invest in top-grade, durable kitchen tools

Kitchen equipment is vital to making sure that your restaurant runs smoothly. The quality of food and service depends on the kitchen tools you use. With the right equipment and appliances, your kitchen team can prepare food efficiently, to a higher quality, and safely. This reduces service time and enhances the dining experience.

While top-grade equipment can be expensive, these items can prove to be good investments for their quality and durability. But, before just buying the most expensive equipment on the market, ensure that you conduct detailed research to find the right equipment for your team.

8. Market Your Restaurant: Develop a full marketing plan

Your marketing plan and budget are crucial to attracting your desired audience. However, when starting out, more may not be better. This is where your budget comes into play. If you are working with a more limited budget, you may opt for social media marketing, handing out flyers and coupons in the community, and word-of-mouth marketing. If you have sufficient funding, then you may choose to execute a comprehensive advertising approach with daily and weekly marketing activities across different channels, such as social media, television, and print media.

However, it's important to remember that there's no one-size-fits-all approach to restaurant marketing, and advertising on different platforms can be expensive. It’s better to prioritize channels that are most likely to engage your target audience.

9. Develop Strong Supplier Relationships: Cultivate a solid partnership with vendors

The stock of your products depends on the relationships you have with your suppliers. A positive relationship with vendors can result in steady supply, better pricing, reduced expenses, and increased profitability. Furthermore, successful vendor relationships can provide you with access to unique or local ingredients, giving your restaurant a competitive edge.

A fast casual restaurant owner is meeting with a supplier. They are shaking hands.

10. Focus on Operational Efficiency: Set up systems for success

Leverage technologies that can optimize your fast casual restaurant and make processes more efficient. According to this report, 95% of restaurateurs think that technology increases efficiency, and 73% of diners feel that restaurant technology enhances their experience. Utilizing tools like inventory management software, order monitoring systems, and scheduling programs can simplify restaurant operations, minimize waste, and manage expenses effectively.

Final Thoughts on Opening a Fast Casual Restaurant

These steps offer a starting point on opening your own fast casual restaurant. While the process may seem difficult, it’s important to take it step-by-step, giving each element the time and attention it needs. And remember, the team you select has the potential to make or break your business. Set up your fast casual restaurant for success by leveraging top employee management software to attract and retain the best. Good luck on your new culinary adventure!

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March 2023


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