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Seafood business plan for starting your own restaurant
Do you want to set up restaurant and earn profit by exhibiting your culinary skills? Well, you must opt for it if you have some good cooking or management skills. Starting a seafood business can prove out to be extremely profitable provided that you select the location wisely.
What you’ll have to do is just hiring the right employees and establishing contacts with seafood vendors and suppliers.
To help you in getting started we’re providing a sample business plan for seafood restaurant written for startup ‘Sea Sprite’. This sample plan can help you in planning your startup and devising a policy for your business.
Executive Summary
2.1 The Business
Sea Sprite will be a registered and licensed seafood dining business based in Chicago, Illinois. The restaurant will be owned by Marlon Hacks. The business will be aimed at providing freshest and healthiest seafood to its customers in a beautiful and peaceful environment.
2.2 Management of Seafood Restaurant
Before starting a seafood restaurant, it is essential to formulate a comprehensive and precise seafood restaurant business plan that covers all details about the startup.
In this sample business plan, we are giving details of the management plan and strategies of Sea Sprite to achieve its goals. Anyone looking for how to open a seafood restaurant can benefit from here.
Marlon will hire skillful cooks and chefs, a manager, general assistants, accountants and waiters to run his restaurant.
2.3 Customers of Seafood Restaurant
Due to the nutritional content and delicious taste, seafood is liked and consumed all over the world by people of all age groups. That’s why we expect the nearby residential community, tourists and persons who arrange a menu for ceremonies and events to be our target customers.
2.4 Business Target
We aim to provide our customers with nutritious, delicious and fresh seafood. We aim at maintaining a repeat customer rate of 61% by the end of the first year and to increase customer footfall in our restaurant from 5 to 10% every month.
Company Summary
3.1 Company Owner
Sea Sprite will be owned by Marlon Hacks. Marlon is an MBA from the University of Chicago. Marlon has been fond of cooking since his teenage. Alongside his studies, he used to cook and bake things side by side. Due to his skills in management and cooking, Marlon believes that he can successfully run a restaurant.
3.2 Why the Seafood Restaurant is being started
Marlon has always wanted to start some food-related business. After analyzing the market and his surroundings, he realized that there are very few restaurants in his hometown that provide all sorts of fresh seafood. Thus, to serve his customers with dishes that aren’t too common, Marlon opted for opening a seafood restaurant.
3.3 How the Seafood Restaurant will be started
The first step Marlon took to start his restaurant was making a business plan for his business. in his business plan, Marlon has defined all the startup strategies and has estimated how much does it cost to open a seafood restaurant.
According to the plan, Marlin will first rent an old restaurant building in the city. The space will be updated with new tiles, new furniture, and new décor after renovation. Alongside the renewal of the place, Marlon will organize tests and interviews for hiring the right employees.
Marlon has decided to hire the personnel for executing the sales strategy plan a month before the launch so that more and more people can get knowledge about the new startup before the actual commence.
Moreover, a strong web presence will be ensured before the day of the launch of the restaurant so that people can explore the restaurant and its competitive aspects by even sitting at their homes.
| Start-up Expenses | |
| Legal | $220,900 |
| Consultants | $0 |
| Insurance | $48,000 |
| Rent | $43,500 |
| Research and Development | $37,000 |
| Expensed Equipment | $66,700 |
| Signs | $3,300 |
| TOTAL START-UP EXPENSES | $419,400 |
| Start-up Assets | $362,000 |
| Cash Required | $449,000 |
| Start-up Inventory | $71,000 |
| Other Current Assets | $275,000 |
| Long-term Assets | $300,000 |
| TOTAL ASSETS | $1,457,000 |
| Total Requirements | $1,876,400 |
| START-UP FUNDING | |
| Start-up Expenses to Fund | $640,400 |
| Start-up Assets to Fund | $2,209,000 |
| TOTAL FUNDING REQUIRED | $2,849,400 |
| Assets | |
| Non-cash Assets from Start-up | $2,642,000 |
| Cash Requirements from Start-up | $202,200 |
| Additional Cash Raised | $48,200 |
| Cash Balance on Starting Date | $38,000 |
| TOTAL ASSETS | $2,930,400 |
| Liabilities and Capital | |
| Liabilities | $35,000 |
| Current Borrowing | $0 |
| Long-term Liabilities | $0 |
| Accounts Payable (Outstanding Bills) | $46,000 |
| Other Current Liabilities (interest-free) | $0 |
| TOTAL LIABILITIES | $81,000 |
| Capital | |
| Planned Investment | $2,849,400 |
| Investor 1 | $0 |
| Investor 2 | $0 |
| Other | $0 |
| Additional Investment Requirement | $0 |
| TOTAL PLANNED INVESTMENT | $2,849,400 |
| Loss at Start-up (Start-up Expenses) | $0 |
| TOTAL CAPITAL | $2,849,400 |
| TOTAL CAPITAL AND LIABILITIES | $2,930,400 |
| Total Funding | $2,849,400 |
Menu of seafood restaurant
Before you start a seafood restaurant its essential for you to decide your menu. Because you’ll need to buy the equipment and will need to contact the vendors as required by your menu. Moreover, if you are about to own a restaurant, deciding your services before time can also help in sorting out the right employees/chefs with the relevant experience.
Before formulating a salon business plan outline you must finalize which services you’ll be providing to your customers because this decision of yours will be affecting the business in the long run.
Sea Sprite will offer the following foodstuff to its customers:
Seafood dishes: We’ll provide all sorts of dishes made by clams, fish, crabs, lobsters, oysters, shrimps, squids, octopus and prawns such as curries, Ceviche, salmon rice, and Lohikeitto.
Soups: We’ll provide seafood soups mixed with seasonal vegetables. Our main servings in this domain will include chowder, Tekwan, Ukha, Machh bhaja, etc.
Salads & Sandwiches: We will provide fresh fish, shrimps, and grilled octopus sandwiches as well as mix salads of vegetables and seafood.
Seafood Pizza & Steaks: The major thing in our menu that isn’t offered by any of our competitors will be seafood pizza with primary ingredients as shellfish, trout, salmon, and shrimps. We’ll also provide steaks of different sea-animals that are liked and consumed by the people.
Marketing Analysis of Seafood Restaurant
Before setting up a restaurant business it’s essential that you properly analyze your market. Market analysis is the assessment of people who are supposed to be the customers of your seafood restaurant. Analyzing your market precisely can help you run the business in the long run because the choice of location, choice of menu and prices are set after taking this important step.
An accurate marketing plan for restaurant business must evaluate the market potential, buying patterns of your target customers and economic patterns in the location in which you are going to start your restaurant.
5.1 Market Trends
Seafood is liked all over the world because it contains high nutrition value, protein, minerals, and vitamin content. The fact that fresh seafood is difficult to acquire and cook has generated more and more demand for processed or cooked seafood.
Note
A 3.6% compound annual growth rate of seafood businesses is reported by Allied Market Research Company. That’s why if you want to open seafood restaurant you need not worry about the scope of the business. the thing for which you should be worried is just correct pre-planning of every aspect of your restaurant.
5.2 Marketing Segmentation
To focus on the needs and demands of the target customers, Sea Sprite has divided them into three groups. Such segmentation must also be done by you if you want to study and explore each group effectively.
The detailed marketing segmentation of our target audience is as follows:
Business plan for investors
5.2.1 Residential Community: Our first target group will be the people living near our restaurant. Since very few seafood restaurants in the vicinity are providing comfortable dine-in facilities, thus we expect the residential community near us to come to us whenever they want to consume good-quality and delicious seafood.
Moreover, almost all the people living near our restaurant have more than average median incomes. Thus they all can afford our dishes made of seafood.
5.2.2 Event Planners: Since seafood is expensive than other usual items, it is considered a good and valuable food to serve people in ceremonies and events. As seafood is a cherished food item in events and seafood pizza is a totally new product for our customers so we expect event and wedding organizers to be our second target category.
5.2.3 Tourists & Passers-By: Our third target group is expected to be the people who pass by our restaurant. Our beautiful display, alluring signboards and appetizing odors of dishes will surely compel them to come inside. Moreover, tourists are also expected to come and consume our products.
| Market Analysis | |||||||
| Potential Customers | Growth | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | CAGR |
| Residential Community | 43% | 26,000 | 31,000 | 37,000 | 46,000 | 59,000 | 11.00% |
| Event Planners | 31% | 20,000 | 23,000 | 27,000 | 35,000 | 44,000 | 11.00% |
| Tourists & Passers-by | 26% | 14,000 | 16,000 | 24,000 | 33,000 | 39,000 | 10.00% |
| Total | 100% | 60,000 | 70,000 | 88,000 | 114,000 | 142,000 | 10% |
5.3 Business Target
Marlon defined a set of goals to be achieved over a fixed time. They are:
- To balance startup expenses by the earned profits by the end of the first eight months
- To increase customer footfall by 8% every month by the end of the first six months
- To maintain customer repeat rate of 61% by the end of the first year
- To maintain an average rating of 4.75 by the end of the first year
- To start food delivery services business by the end of the first year
5.4 Product Pricing
Our prices will be a little bit higher than our competitors. But looking at the financial status and income of target customers we expect that they would love to spend to get quality food in a quality place.
Strategy
After starting a fine dining restaurant, it’s required to carry out a sales strategy plan so that more and more people can be made aware of the new launch.
6.1 Competitive Analysis
Sea Sprite will be coming up with several competitive aspects the first of which is the quality of food. All our products will be absolutely fresh and healthy. Secondly, our menu is much vaster than that of our competitors. We are providing seafood sandwiches and pizza that aren’t offered by any other restaurant in our vicinity. Lastly, we are providing a peaceful and natural environment for our customers to dine in so that they would like to come again and again.
6.2 Sales Strategy
- We’ll ensure a strong web presence
- We’ll start advertising us through Facebook and Instagram one month before the launch
- We’ll install signboards displaying our delicious meals at various places
- We’ll offer a 50% discount on our sandwiches and pizza for the first two weeks of our launch
- We’ll offer a 20% discount card to customers who will spend more than $85 on our food in the first month (non-inclusive of 50% discount defined earlier)
The above-mentioned discounts will be announced a week before Marlon open a restaurant business.
6.3 Sales Monthly
6.4 Sales Yearly
6.5 Sales Forecast
| Sales Forecast | ||
| Unit Sales | Year 1 | Year 2 |
| Seafood Dishes | 40,000 | 42,400 |
| Soups | 21,000 | 22,260 |
| Salads & Sandwiches | 23,000 | 24,380 |
| Seafood Pizza & Steaks | 37,000 | 39,220 |
| TOTAL UNIT SALES | 121,000 | 128,260 |
| Unit Prices | Year 1 | Year 2 |
| Seafood Dishes | $69.00 | $80.04 |
| Soups | $41.00 | $47.56 |
| Salads & Sandwiches | $44.00 | $51.04 |
| Seafood Pizza & Steaks | $56.00 | $64.96 |
| Sales | ||
| Seafood Dishes | $2,760,000.00 | $3,393,696.00 |
| Soups | $861,000.00 | $1,058,685.60 |
| Salads & Sandwiches | $1,012,000.00 | $1,244,355.20 |
| Seafood Pizza & Steaks | $2,072,000.00 | $2,547,731.20 |
| TOTAL SALES | $6,705,000.00 | $8,244,468.00 |
| Direct Unit Costs | Year 1 | Year 2 |
| Seafood Dishes | $46.00 | $48.00 |
| Soups | $21.00 | $27.00 |
| Salads & Sandwiches | $24.00 | $26.00 |
| Seafood Pizza & Steaks | $37.00 | $41.00 |
| Direct Cost of Sales | ||
| Seafood Dishes | $1,840,000.00 | $2,035,200.00 |
| Soups | $441,000.00 | $601,020.00 |
| Salads & Sandwiches | $552,000.00 | $633,880.00 |
| Seafood Pizza & Steaks | $1,369,000.00 | $1,608,020.00 |
| Subtotal Direct Cost of Sales | $4,202,000.00 | $4,878,120.00 |
Personnel plan
Opening a restaurant isn’t much difficult but running it successfully can surely become hard if you don’t have good employees. That’s why make sure that you employ the right workers after conducting proper tests and interviews.
7.1 Company Staff
Marlon will manage the business himself, for other works he’ll hire the following people.
- 1 Accountant to maintain financial records
- 1 Co-Manager to help in managing the restaurant
- 2 Sales Executives to carry out the company’s sales strategy plan
- 6 Chefs/Cooks to prepare dishes
- 4 General Assistants to do routine tasks
- 4 Waiters/ Waitresses to serve the customers
- 3 Cleaners to maintain the facility
- 1 Driver to transport materials and supplies
- 1 Web Developer to manage company’s sites
- 1 Customer Representative to provide customer care service
- 1 Security Guard/Gatekeeper
7.2 Average Salary of Employees
| Personnel Plan | |||
| Year 1 | Year 2 | Year 3 | |
| Accountant | $22,000 | $24,200 | $26,620 |
| Co-Manager | $24,000 | $26,400 | $29,040 |
| Sales Executives | $39,000 | $42,900 | $47,190 |
| Chefs/Cooks | $135,000 | $148,500 | $163,350 |
| General Assistants | $94,000 | $103,400 | $113,740 |
| Waiters/Waiteresses | $84,000 | $92,400 | $101,640 |
| Cleaners | $66,000 | $72,600 | $79,860 |
| Driver | $21,000 | $23,100 | $25,410 |
| Web Developer | $19,000 | $20,900 | $22,990 |
| Customer Representative | $20,000 | $22,000 | $24,200 |
| Security Guard/Gatekeeper | $21,000 | $23,100 | $25,410 |
| Total Salaries | $460,000 | $599,500 | $659,450 |
Financial Plan
The last step before you open restaurant is to make a financial plan. Your financial plan must include all the details of your investments, monthly expenses, expected profits, possible losses and strategies to maximize profit and minimize possible losses.
In this business plan, we’re giving a free sample of the financial plan of Sea Sprite that Marlon has developed himself. The sample is based on approximated costs for Sea Sprite and you must contact a financial expert if you want accurate figures according to your startup.
8.1 Important Assumptions
| General Assumptions | |||
| Year 1 | Year 2 | Year 3 | |
| Plan Month | 1 | 2 | 3 |
| Current Interest Rate | 8.02% | 8.65% | 9.40% |
| Long-term Interest Rate | 8.30% | 8.70% | 9.20% |
| Tax Rate | 25.30% | 26.70% | 27.10% |
| Other | 0 | 0 | 0 |
8.2 Brake-even Analysis
| Brake-Even Analysis | |
| Monthly Units Break-even | 5335 |
| Monthly Revenue Break-even | $138,200 |
| Assumptions: | |
| Average Per-Unit Revenue | $253.30 |
| Average Per-Unit Variable Cost | $0.72 |
| Estimated Monthly Fixed Cost | $171,000 |
8.3 Projected Profit and Loss
| Pro Forma Profit And Loss | |||
| Year 1 | Year 2 | Year 3 | |
| Sales | $6,705,000 | $8,244,468 | $10,137,398 |
| Direct Cost of Sales | $4,202,000 | $4,878,120 | $5,778,675 |
| Other | $0 | $0 | $0 |
| TOTAL COST OF SALES | $4,202,000 | $4,878,120 | $5,778,675 |
| Gross Margin | $2,503,000 | $3,366,348 | $4,358,723 |
| Gross Margin % | 37.33% | 40.83% | 43.00% |
| Expenses | |||
| Payroll | $460,000 | $599,500 | $659,450 |
| Sales and Marketing and Other Expenses | $138,000 | $145,000 | $150,000 |
| Depreciation | $2,600 | $2,860 | $2,900 |
| Leased Equipment | $0 | $0 | $0 |
| Utilities | $3,800 | $4,300 | $4,700 |
| Insurance | $2,100 | $2,600 | $3,100 |
| Rent | $6,300 | $6,600 | $6,900 |
| Payroll Taxes | $44,000 | $48,000 | $51,200 |
| Other | $0 | $0 | $0 |
| Total Operating Expenses | $656,800 | $808,860 | $878,250 |
| Profit Before Interest and Taxes | $1,846,200 | $2,557,488 | $3,480,473 |
| EBITDA | $1,846,200 | $2,557,488 | $3,480,473 |
| Interest Expense | $0 | $0 | $0 |
| Taxes Incurred | $369,240 | $511,498 | $696,095 |
| Net Profit | $1,476,960 | $2,045,990 | $2,784,378 |
| Net Profit/Sales | 22.03% | 24.82% | 27.47% |
8.3.1 Profit Monthly
8.3.2 Profit Yearly
8.3.3 Gross Margin Monthly
8.3.4 Gross Margin Yearly
8.4 Projected Cash Flow
| Pro Forma Cash Flow | |||
| Cash Received | Year 1 | Year 2 | Year 3 |
| Cash from Operations | |||
| Cash Sales | $54,000 | $58,320 | $63,400 |
| Cash from Receivables | $11,400 | $12,312 | $13,297 |
| SUBTOTAL CASH FROM OPERATIONS | $63,300 | $68,997 | $74,517 |
| Additional Cash Received | |||
| Sales Tax, VAT, HST/GST Received | $0 | $0 | $0 |
| New Current Borrowing | $0 | $0 | $0 |
| New Other Liabilities (interest-free) | $0 | $0 | $0 |
| New Long-term Liabilities | $0 | $0 | $0 |
| Sales of Other Current Assets | $0 | $0 | $0 |
| Sales of Long-term Assets | $0 | $0 | $0 |
| New Investment Received | $0 | $0 | $0 |
| SUBTOTAL CASH RECEIVED | $61,000 | $63,200 | $65,600 |
| Expenditures | Year 1 | Year 2 | Year 3 |
| Expenditures from Operations | |||
| Cash Spending | $36,600 | $41,900 | $43,500 |
| Bill Payments | $19,000 | $22,000 | $24,000 |
| SUBTOTAL SPENT ON OPERATIONS | $51,100 | $61,000 | $68,900 |
| Additional Cash Spent | |||
| Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 |
| Principal Repayment of Current Borrowing | $0 | $0 | $0 |
| Other Liabilities Principal Repayment | $0 | $0 | $0 |
| Long-term Liabilities Principal Repayment | $0 | $0 | $0 |
| Purchase Other Current Assets | $0 | $0 | $0 |
| Purchase Long-term Assets | $0 | $0 | $0 |
| Dividends | $0 | $0 | $0 |
| SUBTOTAL CASH SPENT | $56,400 | $60,912 | $65,785 |
| Net Cash Flow | $14,000 | $16,400 | $18,300 |
| Cash Balance | $28,900 | $33,410 | $37,000 |
8.5 Projected Balance Sheet
| Pro Forma Balance Sheet | |||
| Assets | Year 1 | Year 2 | Year 3 |
| Current Assets | |||
| Cash | $260,100 | $291,312 | $320,443 |
| Accounts Receivable | $22,900 | $25,648 | $28,828 |
| Inventory | $4,320 | $4,838 | $5,100 |
| Other Current Assets | $1,000 | $1,000 | $1,000 |
| TOTAL CURRENT ASSETS | $310,900 | $348,208 | $391,386 |
| Long-term Assets | |||
| Long-term Assets | $10,000 | $10,000 | $10,000 |
| Accumulated Depreciation | $16,100 | $18,032 | $20,286 |
| TOTAL LONG-TERM ASSETS | $20,200 | $22,624 | $25,452 |
| TOTAL ASSETS | $297,000 | $332,640 | $374,220 |
| Liabilities and Capital | Year 4 | Year 5 | Year 6 |
| Current Liabilities | |||
| Accounts Payable | $18,000 | $20,160 | $22,660 |
| Current Borrowing | $0 | $0 | $0 |
| Other Current Liabilities | $0 | $0 | $0 |
| SUBTOTAL CURRENT LIABILITIES | $13,800 | $15,456 | $17,373 |
| Long-term Liabilities | $0 | $0 | $0 |
| TOTAL LIABILITIES | $13,800 | $15,456 | $17,373 |
| Paid-in Capital | $29,000 | $30,000 | $30,000 |
| Retained Earnings | $65,000 | $70,850 | $77,935 |
| Earnings | $184,500 | $201,105 | $221,216 |
| TOTAL CAPITAL | $283,200 | $308,688 | $339,557 |
| TOTAL LIABILITIES AND CAPITAL | $297,000 | $332,640 | $374,220 |
| Net Worth | $278,500 | $303,565 | $333,922 |
8.6 Business Ratios
| Ratio Analysis | ||||
| Year 1 | Year 2 | Year 3 | INDUSTRY PROFILE | |
| Sales Growth | 7.10% | 7.87% | 8.72% | 3.00% |
| Percent of Total Assets | ||||
| Accounts Receivable | 9.18% | 10.17% | 11.27% | 9.80% |
| Inventory | 5.60% | 6.20% | 6.87% | 9.90% |
| Other Current Assets | 2.47% | 2.74% | 3.03% | 2.40% |
| Total Current Assets | 150.00% | 153.00% | 156.00% | 158.00% |
| Long-term Assets | 11.10% | 12.30% | 12.80% | 12.00% |
| TOTAL ASSETS | 100.00% | 100.00% | 100.00% | 100.00% |
| Current Liabilities | 4.49% | 4.53% | 4.57% | 4.34% |
| Long-term Liabilities | 0.00% | 0.00% | 0.00% | 0.00% |
| Total Liabilities | 7.06% | 7.12% | 7.18% | 7.38% |
| NET WORTH | 104.10% | 104.93% | 105.90% | 110.00% |
| Percent of Sales | ||||
| Sales | 100.00% | 100.00% | 100.00% | 100.00% |
| Gross Margin | 97.60% | 100.24% | 103.04% | 98.00% |
| Selling, General & Administrative Expenses | 92.60% | 95.10% | 97.76% | 97.30% |
| Advertising Expenses | 1.89% | 1.94% | 2.00% | 1.40% |
| Profit Before Interest and Taxes | 43.90% | 45.09% | 46.35% | 34.10% |
| Main Ratios | ||||
| Current | 38 | 39.6 | 40.59 | 32 |
| Quick | 34 | 34.8 | 35.67 | 34 |
| Total Debt to Total Assets | 0.31% | 0.24% | 0.01% | 0.41% |
| Pre-tax Return on Net Worth | 76.09% | 79.89% | 83.89% | 75.00% |
| Pre-tax Return on Assets | 90.05% | 94.55% | 99.28% | 112.00% |
| Additional Ratios | Year 1 | Year 2 | Year 3 | |
| Net Profit Margin | 34.70% | 35.78% | 36.88% | N.A. |
| Return on Equity | 58.43% | 60.24% | 62.11% | N.A. |
| Activity Ratios | ||||
| Accounts Receivable Turnover | 7.25 | 7.54 | 7.8 | N.A. |
| Collection Days | 100 | 100 | 100 | N.A. |
| Inventory Turnover | 34.4 | 36.12 | 37.926 | N.A. |
| Accounts Payable Turnover | 16.08 | 16.5 | 16.98 | N.A. |
| Payment Days | 27 | 27 | 27 | N.A. |
| Total Asset Turnover | 2.45 | 2.65 | 2.72 | N.A. |
| Debt Ratios | ||||
| Debt to Net Worth | -0.04 | -0.05 | -0.05 | N.A. |
| Current Liab. to Liab. | 1 | 1 | 1 | N.A. |
| Liquidity Ratios | ||||
| Net Working Capital | $220,450 | $232,795 | $245,832 | N.A. |
| Interest Coverage | 0 | 0 | 0 | N.A. |
| Additional Ratios | ||||
| Assets to Sales | 0.81 | 0.88 | 0.97 | N.A. |
| Current Debt/Total Assets | 1% | 1% | 0% | N.A. |
| Acid Test | 28.4 | 27.5 | 31.1 | N.A. |
| Sales/Net Worth | 2.1 | 2.1 | 2.3 | N.A. |
| Dividend Payout | 0 | 0 | 0 | N.A. |
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