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When and Whether to Open a 2nd Restaurant

By: Maggie Lonsdale BA (hons) - Updated: 9 Oct 2010 | comments*Discuss
 
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Opening a second restaurant is a major commitment. Your second restaurant is likely to be in another location, so on top of all the hassles of finding staff, creating menus and arranges leases, you will have the added pressure of the ‘commute’ between the two and effectively dividing your time.

Many people feel that they want to open a second restaurant as there are some issues or restrictions with their first restaurant. Perhaps they find out that an excellent site has become available and, rather than relocate their current restaurant, decide to launch a second branch that fits together with the first.

There is also the egotistical element of ‘starting an empire’ that is really appealing. You need an element of that great self confidence to be able to start your own business in the first place, so rather than criticise yourself, embrace your ego!

What Are Your Goals?

Most entrepreneurs and tycoons will tell that it is important that you can identify your goals in order to be in with a chance of achieving them. Although you need to be able to be spontaneous and grasp opportunities with both hands, it is worth having a clearly defined business plan that illustrates your short, medium and long term goals.

If you have ‘opening a second restaurant’ on your business plan, it may be that you are more suited to the business and operational aspects of running a restaurant, rather than seeing yourself peeling hundred of potatoes and meeting and greeting.

Look at the success of your first restaurant and be clear about what worked and what didn’t.Don’t just leap into opening a second restaurant to boost your ego without being totally clear about the lessons you have learnt.

Be honest with yourself about why you want to open a second restaurant and understand what will be involved in making it a success.

Can You Afford It?

There will be a whole raft of positive and negative financial connotations regarding opening a second restaurant. You will be able to make use of economies of scale for some purchasing – wine, for example, can be bought in bulk at better rates.

Do not make the mistake of seeing a great deal on a lease and think that, because you already have one branch, a second location is only about the property. Unless your second location is practically next door, the issues of staffing, fresh produce supplies and all sorts will be almost as much as with the first. The key difference will be that you have been there and done that, so at least make the most of your experience. The issues of finance will be mostly issues you have seen before.

Do You Have a Brand?

If you are planning to open a second restaurant, you need to think about whether you are simply wanting to open ‘another’ restaurant – perhaps serving different food, or with a totally different target client base, or if you are wanting to start building a brand.

A brand is a clearly definable product that is easily recognisable and offers considerable business opportunities. In marketing terms, as long as your restaurant is appealing, developing a brand is the Holy Grail. Branding allows you to create a restaurant that people consider a ‘destination’ in itself – celebrity chefs know this and use their name to their advantage. When you build up a good reputation with your first restaurant, as long as you make sure not to cut corners, your second branch can be a great success.

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