Many budding entrepreneurs think about opening a restaurant in Raleigh. While there is no doubt that the restaurant business can be very lucrative, the fact is that more than 70% of new restaurants fail within the first two years of opening. The primary reason for this high failure rate in the restaurant business is a lack of planning.

 

Below are some beginner tips to keep in mind when opening a restaurant in Raleigh:

 

• Have a business plan

The competition is very high in the restaurant industry; the first thing you should do is develop a business plan. Consider every minute detail, even the menu, chef, floor plan, interiors, layout, seating capacity, kitchen appliances, staff selection, working hours, and how much money and time you are willing to put into the restaurant business. 

If you think others can run your restaurant and make money for you, then this restaurant business is definitely for you.

• Identify why you want it

Many people think that the restaurant business is the easiest way to make money. This is a myth. It can take up to 4-7 years before you start recouping the money you invested and making a profit. Running a restaurant is not a 9-5 job; it is a full-day job with all days working. 

Open a restaurant if you love food, and people, and are not afraid of hard work. There are no weekends off, or any holidays and you are certainly not going to bed early. Moreover, in the first initial year, you have to invest a lot of time and money.

• Financial planning

Opening a restaurant in Raleigh means having a solid plan that includes how much money you want to invest and every minute detail of potential expenses, cost of furniture, salaries, utilities, rental bills, and lease options. You need to keep a track of your competitors in your area and need to identify the target market as well. 

Finally, you will also need a competitive edge and you need to know how to make your restaurant stand unique from other competitors. 

• Location

This is the most important factor to consider when you want to open a restaurant in Raleigh. Choose a good location; one that your research indicates is a thriving area for restaurants, one that has a great flow of customers, and one that is considered a great location for people to visit. 

Your restaurant can only work if there is a place where a lot of people come and chill. It may also be a good idea to ensure that you don’t have direct competitors around. There is no point in opening a pizza outlet next to leading pizza corners or Italian restaurants in the same vicinity. You can only take a chance only if you know that you have something special and better to offer.

Apart from these factors mentioned above, there are many other things to consider when opening a restaurant in Raleigh. From local licensing requirements, and insurance to the general state, you need to keep everything well-equipped before getting into the process.  

You must have to register your business with federal agencies as an employer. Always make sure to complete the necessary paperwork before you go for the big launch.

 

Insurance

 

Below are a few types of insurance for Raleigh, North Carolina restaurant owners to consider:

• Worker’s compensation insurance

Raleigh, North Carolina state law required worker’s compensation insurance for all businesses that employ 3 or more individuals, part-time or full-time. This Business insurance covers all the medical bills for work-related illnesses and injuries. It also offers disability benefits to injured workers in North Carolina and protects employers from liability over an injury.

• Commercial auto insurance

 All business vehicles in Raleigh, NC must be covered by commercial auto insurance. This policy covers the cost of an accident involving work vehicles.  The minimum requirements for auto liability insurance are $32,000 in bodily injury accountability per person, $62,000 in bodily injury accountability per accident, and $27,000 in property damage accountability.

Personal vehicles used for work purposes should not cover the hired and non-owned auto insurance as personal auto policies usually exclude business use. It can be added to a business owner’s policy or commercial general liability insurance.

 

The next step is the most significant part when it comes to opening a restaurant in Raleigh, North Carolina- it is to get acquiescent with local laws.

 

So opening a restaurant, café, bar or any other type of food business is in your mind, and then you must possess all these licenses and permits in order.

Licenses are certificates of occupancy, liquor license, and food facility health permit. All these legalities have different requirements. So it is imperative to know what you want exactly to legally start the process of opening a restaurant in Raleigh, North Carolina.

Mentioned below are some permits and licenses needed to open a restaurant in Raleigh. What are they, what is the cost of each license, and why do you need it?

• Business license in Raleigh, North Carolina

To kick start your restaurant business, a business license is the first and foremost license. It is also known as a business tax certificate license, which helps the business during tax season. In North Carolina, a business license is controlled by the county or city you live in. If you are planning to operate a particular restaurant in various locations all across the cities, it is necessary to get a business license for every business in different authorities. 

To get a business license in Raleigh, you need an  EIN, business name, proper business plan, contact number and address, COI for an insurance policy, and classification of business.

The cost of this business license in Raleigh varies depending on the county, the type of business, and the scope of business. Business licenses in Raleigh need to be renewed and paid regularly, so check with the jurisdiction about how often it is required to get them renewed.

• Certificate of occupancy in Raleigh

It is a document that shows that your space is precinct for your type of business, it is up-to-date, up to code and safe to use. Not every city will require them for new businesses, and even then, only certain situations require them, only if you are doing some major construction work or changing the use of any space from housing to business. 

Always be in touch with the local jurisdiction to check if the project is under a CoO warrant. To get this license, you need to check online, but to get hold of the certificate, your business location will go under inspections like fire, plumbing, electrical, and building inspections. The cost of this certificate is different in every country and it also varies depending on the type of business. .

• Food handler’s license in Raleigh

It is also generally known as an employee health permit license which allows restaurants, merchants, and other types of food businesses to sell and serve the food with full safety. These licenses make sure that every employee is doing their job properly and also keeping the diners safe from diseases occurred through food. 

It is also known as ServSafe, once the company administers handler’s test, as Raleigh, North Carolina Food Handler Card. To get this license, every employee who prepares and serves food in North Carolina must get their Food handlers license within 30 days of the period of being hired. 

Cooks, chefs, bartenders, and servers should have this license. Buzzers and general managers may not require this. And by any chance the managers already have their food protection manager certificate, they are also not liable for getting a North Carolina Food Handler Card. Some of the jurisdictions have their food safety programs and standards, so they are excused from getting a North Carolina Food Handler Card. 

To get this card, employees must pass the test of food safety and preparation with a grade of at least 90%. The cost of this license should not be more than $30, to make sure that anyone working in the restaurant can easily afford it.

• Food seller’s Permit in Raleigh, North Carolina

If a restaurant is planning to sell any tangible goods and is subject to any sales tax needs as a seller’s permit. This permit also allows them to charge sales tax. To get this permit, you can register online or through the SBA license and permits portal. There are no charges for this seller’s permit but you might need to pay a security deposit to cover the unpaid taxes if the business shuts down.

• Liquor license in Raleigh, North Carolina

In North Carolina, the liquor license application process is way faster and smoother than in any other state. You can download application forms from the North Carolina Alcoholic Beverage Control Commission. Along with other requested documentation and paperwork. 

After applying for a license in the North Carolina board, your proposed location will be investigated and vetted by the commission, with the help of the Alcohol Law Enforcement Division, to make sure that all the requirements are being met easily. Some other requirements include:

• validating that the space adheres to fire codes and building

• evaluating if the space is within 60 feet of a church or school

• exploring if your proposed alcohol-serving establishment will harm the surrounding

There are two main types of alcohol permits available in Raleigh, North Caroline that are each connected with different parts of the sale of alcoholic beverages supply chain:

• Retail permit: retail permits are necessary if you are selling alcohol at retail convenience stores

• Commercial permits: commercial permits are also needed if you are involved in the distributing, importing, manufacturing, and bottling of alcoholic beverages; run wineries or distilleries; or engaged in activities mainly handled by the wholesalers. Also depending on the nature of your particular alcohol business initiatives, you may need to apply for more than one permit or may need to fill out additional forms outside of the North Carolina liquor license documents.

 

• Catering business license in Raleigh, North Carolina

In Raleigh, there is no specific catering license, but caterers need to obtain a liquor license if they will be serving alcohol and food safety certifications like other businesses that handle food.

• Food facility health permit in Raleigh, North Carolina

It is mandatory to have a health permit to open a restaurant in Raleigh, North Carolina and one must adhere to safe food handling, preparation practices, and storage options. It can also prevent food-borne diseases in people and make sure to endow them with a safe working environment. 

In Raleigh, the health permit is under city or county jurisdiction, so it is always advisable to check under the health department. These licenses are non-transferable. If you are starting a new restaurant, even if it is in the area of the previous restaurant, you need to get a new health permit. 

So, when you plan to apply for the health permit, which can be done online as well, you have to go through an inspection to make sure that the practices and space will fit under the health and safety code of North Carolina. If everything works well, you will get your license. The cost of this license varies from place to place. 

• Employee health permit in Raleigh, North Carolina

In Raleigh, North Carolina, an Employee Health Permit is just like a food handler’s license. There are many legal necessities required before your grand opening day.  

EIN

To get the permits above, and also be able to hire employees, every business needs an EIN. Applying for this is not an easy task. You can do it online, via fax, or by mail. Most of the applicants will prefer to do it online as it is the easiest way as compared to mail or fax. 

 

Financial considerations to keep in mind while opening a restaurant in Raleigh, North Carolina:

 

During the process of opening a restaurant in Raleigh, you have to select the right type of ownership and business entity. It is necessary to secure funding as well for your restaurant.

Business Entity

Deciding the type of business entity is a difficult task. You need to opt between the S corporation, C Corporation, sole proprietorship, and LLC.

Ownership Structure

Ownership and profit are loomed differently by various restaurants. Some have investors; some have one boss and many employees. Others function like a co-op with every employee at stake. And many businesses operate between the owners and partners but employees also get the profit from the business.

Figuring out the type of profit sharing and structure is the best for business and working with an accountant and lawyer to take out all the important documentation and contracts.

 

How location plays a major role in making your restaurant a huge success?

 

Picking up the right location for your restaurant is very decisive. A lot of research is required on demographics, the market, and your competitors. Size, space, visibility, and history of the location are very important to keep a check on. There are two options, you can either buy the space or lease it or construct it from the ground level. Some other additional criteria to keep in mind while evaluating a location for your restaurant are:

• Society
• Real estate circumstances
• Dimension on the site
• Preceding tenants
• Ideal customer summary and target market

Generally, the space and layout of the location should bring life to your restaurant idea. If you want to open a stylish steakhouse, then you must have a proper building. If you want to serve sandwiches and tacos, you can opt for the truck as well.

It is imperative to keep some points in mind like dimension, floor plan, layout, and location. If you are planning to keep an open kitchen then you need a good space for your restaurant.

Wherever you decide to open a restaurant, be sure that your restaurant is visible. It should be easy to spot from the street on which it resides. Your parking lot is also very important as your restaurant space, especially if it is unique as compared to its competition. If a customer can’t find a place to park their car, you might lose business. Restaurants located off a highway get good business.

 

Some other things to be considered before opening a restaurant are:

 

• Competition: before signing the lease for your restaurant, it is vital to keep a check on your competitors. So, make sure you visit as many restaurants as you want in the area you are planning to open a restaurant. Visiting your competitors will give you a sneak peek at their strengths and weaknesses, which will give you a competitive edge. Look for the customer’s preferences so that you can implement them into your restaurant, and also recognize their successes and failures to know what to do and what not to do.

• Target customers: the type of customers you want to attract will also affect the type of restaurant you want to operate. It is vital to consider the income level, lifestyle, the age of the customers you want to attract. For example, do you wish to attract customers that typically take time while eating? Is your target audience willing to travel to the restaurant? How much money are they willing to spend on meals? Are they available for the morning, afternoon, or late evenings of the month? Once you figure out all these things, you will get a clear picture of the restaurant you want to start, the menu, price range, and even the décor and ambiance.

• Marketing: take advantage of many social media platforms to market it. Join restaurant coalitions so you can work with other restaurant owners to cross-promote your space. Many cities promote local businesses, so it is beneficial to join the chamber of commerce and participate in food festivals to market your restaurant.

• Delegation: it is not easy to trust others with your restaurant, but delegating and prioritizing are a must in this food industry. You cannot do everything just by yourself, so be sure to hire professional staff to your specifications and then let go.

Final words:

 

Opening a restaurant is a major undertaking with dozens of steps and mountains of paperwork. Writing up a solid restaurant business plan and securing funding for your restaurant are some of the major things you need to do so that you can afford all the building blocks of your business which includes permits and licenses.

Apart from all the permits and licenses, you must take care of the design and layout of the restaurant. 

Seating capacity, ambiance, décor, cleanliness, furniture, and music play an important role in making your restaurant a huge success. Another important requirement is the staff. Your staff should be based on the unique needs of your restaurant, but below are some of the common positions:

• Management team
• Kitchen staff
• Front-of-house staff
• Bar staff
• Marketing experts, accountants, and PR specialists

Lastly, advertise your restaurant, build a website, and mobile app for restaurants, create a YELP, open a table account, and use social media like Facebook, Instagram, and Twitter to promote your restaurant on various platforms. Offer restaurant gift cards to new customers; host a grand party to introduce the specialty of your restaurant through new cuisines, and drinks. Invite people to visit your restaurant and enjoy happy hours with some light music.

As you come closer to the opening day, you can also start to peruse the technology options of your restaurant like restaurant ordering system and find what combination of products and systems make sense to help you set your operation up for success from day one. All these steps will get you closer to your dream of opening a restaurant in Raleigh, North Carolina.