Restaurant - Start-up - Projected Sources & Uses of Cash

Introduction
Projected Sources & Uses of Cash
Capital Budget
Land & Building
Leasehold Improvements
Bar/Kitchen Equipment
Bar/Dining Room Furniture
Professional Services
Organizational & Development
Interior Finishes & Equipment
Exterior Finishes & Equipment
Pre-Opening Expenses
Working Capital & Contingency

Restaurant - DO, 8 weeks before opening

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Home / Learning Center / Articles / Restaurant Operations / Opening a Restaurant

Opening a restaurant

takes time, patience and plenty of work. Deadlines must be met, and your efforts must be set towards meeting your budget and creative specifications. But with the right planning, getting everything done in a timely manner can be accomplished with minimum frustration.

What should I know before

opening a restaurant

?
Since your first priorities will be to the building your business will be located in, and to the supplying of your restaurant, you need to work closely with your contractor to ensure he or she fully understands the operation of your establishment and has fulfilled your needs in return. This includes, among other things, assurance that you have received all the licenses pertaining to your area and knowledge that you have applied for federal, state and local tax numbers. In addition, make sure your contractor is aware of your responsibilities to your lease before, during and after construction. Most importantly: Don�t assume anything. Put everything you want done in writing!

Also, for the sake of organization, set up a storage area so you can store equipment, smallwares, supplies and such as you receive them. This way, you won�t have to coordinate with your contractor to receive items at the site.

What steps will I need to take in the weeks leading up to the

opening of my restaurant

?
Naturally, each restaurant is different. But every one still has to undergo certain procedures to ensure a successful

restaurant opening

. The following eight-week plan offers a time-tested process that can be expanded (to 12 weeks, for example) or shortened (to 6 weeks) depending on your needs. It also gives you plenty of time to cover your tracks and plan ahead, just in case the unexpected occurs.

Eight weeks before

opening a restaurant

: Get the preliminaries out of the way.
First thing first: Prepare your pre-opening budget and start envisioning what sort of image you would like to convey for it. This will carry you through the rest of the process and set a visual goal of what you�d like to accomplish.

Then, set out on obtaining the necessary background materials and legalities. Evaluate local broadline distributors and consider specifics, like scope/lines of products available, delivery times/frequency, prices on key products; credit terms; electronic or Internet ordering options; and other support services offered, such as business reviews, consultation, staff training. Also, establish your insurance policy and apply for the necessary licenses from the health department, the food manufacturer and the water department. Also, determine local certification requirements (HACCAP training), check local health codes and ordinances, determine requirements for your alcoholic beverage server, and make sure your business and liquor licenses are in order and that you�re set up correctly for sales and use tax.

In addition, start ordering your cooking equipment, smallwares and tabletop items, like flatware, tableware, glassware, sugar caddies, smallwares and kitchen utensils, salt and pepper shakers, table vents, vases and the like. Also, order your beverage service, point-of-sale (POS) system and store d�cor; order menu boards, exterior signage, office equipment (copied, fax, computer, calculators), and office furniture (desk, chair, filing cabinet, etc.).

Seven weeks before

opening a restaurant

: Following up on what you started.
Things should be beginning to take shape now, so make it a priority to follow up on your timelines and get yourself organized. Arrange for a moving company, if needed, for furniture and such. Check the statuses of your licenses with the health department, food manufacturer and water department, as well as with your business license, liquor license and sales and use tax. Also, check the status of your sales, federal, state and local tax numbers.

In addition, establish your banking system and accounts and obtain bids for local trash pick-up, grease removal, extermination services, laundry, appliance repair, fire extinguishers, music system, security alarms and security systems, knife and blade sharpening, window washing and dishwasher service. Furthermore, determine emergency plans, exit procedures and create maps, finalize your POS decision and acquire your software needs for your office (MS Office, scheduling, food management software, etc.).

Also, select a pre-opening site to conduct interviews and start organizing your pre-opening parties, such as events for the press, VIPs and contractors. You will be surprised how quickly everything will fall together in the coming weeks, so it�s best to be prepared.

Six weeks before

opening a restaurant

: More preparations.
You should be receiving your tax numbers now, so with the ball rolling, start preparing for D-Day. Order �Opening Soon� and �Now Hiring� banners for your windows, and a �Grand Opening� banner for the front entrance. Also, order plastic engraved signs for pertinent information (�Ladies,� �Men,� �No Smoking,� �Delivery Hours,� etc.), and set up order books, a maintenance and cleaning calendar and an inventory system. Also, conduct a walk-through with the contractor to make sure he or she is familiar with those systems as well, and retain a full set of building and equipment plans for operational files.

Check inspection dates and acquire mandatory posters and children�s amenities (high chairs, boosters, crayons, etc.). Set up communications for your office, like a fax machine, pagers, and hostess station equipment. Set up credit card merchant accounts, and select an accounting service or in-house bookkeeper and acquire the appropriate software. Also, obtain menu materials - covers, inserts, to go menus, catering, children, and order restroom accessories, like hand towels and air dryers, soap dispensers and trash receptacles.

In addition, start thinking about your staff and events. Prepare �Help Wanted� ads and get employee name tags and restaurant uniforms. Identify what your staffing needs will be exactly, and then develop an action plan for meeting those needs. Also, order a valet stand and key control system, acquire entertainment permits, and craft a list of potential entertainers (including an invitation list for pre-opening parties and order invitations).

Five weeks before

opening a restaurant

: Yet even more preparations.
Continue planning and set-up work, to ensure small issues won�t become larger problems later on down the line. Set up your equipment maintenance log book. Order office and miscellaneous supplies. Finalize vendors for food/paper products and set up delivery schedules with them (and commissary) � include backup vendors. Set up fire and health inspections. Label valves, switches, compressor and breakers and check for accessibility. Also, acquire bids and select vendors for d�cor, like interior plants and landscaping. In addition, acquire janitorial equipment (wet floor signs, mops, buckets, vacuum, trash receptacles).

While doing this, continue your staffing plans. Place your �Help Wanted� ads, purchase training materials for food safety training, develop deposit procedures (establish armored car service or other), finalize food and supply orders for training, mock shifts, and opening week. Also, setup an employee filing system, acquire a first aid box, create a seating chart and wait staff sections, setup a petty cash system, acquire tip trays, and check presentation folders, if not provided from merchant account provider.

Four weeks before

opening a restaurant

: Time to start setting up.
Around this time, you should be receiving your case work and furniture, including your counters, cabinets, menu board frames, tables, chairs and barstools. So that will need to be installed. Also, by this point, you should also have a number of candidates in mind for staff positions. To accommodate, start scheduling and preparing interviews and prepare a training schedule for those you will hire. Also, set up your POS or register for training your management and crew and create job aids (pictures of menu items, procedure steps, etc.) for the kitchen staff. This is also a good time to determine your emergency equipment shutoff procedures and start thinking about your opening week schedule--make it heavy, since you really want to test yourself and see what you can and cannot accomplish reasonably.

Other important tasks to consider: Acquire an internet service provider, a kitchen clock, tools and a tool kit, and linens. Also, get your parking lot striping and handicap space requirements, and select your services for local trash pick-up, grease removal, exterminator, laundry, appliance repair, fire extinguishers, music system, alarm and security system, knife and blade sharpening, window washing and dishwasher service. Also, review your review OSHA requirements with management.

In addition, continue to think about opening night. Send out your opening party invitations and press releases to local media.


Three weeks before

opening a restaurant

: Getting into gear.
Timing becomes crucial at this point. You need to make sure several smaller tasks get completed while still keeping your larger projects moving.

First and foremost, you�ll be interviewing and hiring possible employees and getting them trained as soon as possible. That means you�ll have to have your training sessions finalized and assign your hired employees for HACCAP training and certification. In addition, you�ll need to get employees certified for alcoholic beverage service and conduct alcoholic beverage and wine service training. Also important: Assemble your new-employee supplies, such as applications, uniforms, employer-employee agreements, W-4 & I-9 forms, cash register policies, and employee handbook and more. Also order your initial food for training, as well as your first paper goods order. To make sure everything is accounted for, create detailed inventory worksheets or count sheets and prepare your delivery schedule for your vendors.

To ensure training commences smoothly, you will need to have your beverage service and POS system installed and ready to go. In addition, obtain bags and night deposit keys, deposit stamps and slips, coin rolls and bill bands.

On top of this, the final load of your supplies and equipment should be coming in, such as your smallwares, ice machine, janitorial supplies, Ansul System, alarm system, fire extinguishers and more. You will need to install these items and then ensure everything meets your satisfaction. Obtain sub-contractor�s telephone numbers in case repairs are needed, and set up all equipment maintenance and repair instructions in designated spots in case fixes must be done in-house. In addition, create a control system for padlocks for cooler doors and conduct a safety audit.

Two weeks before

opening:

Restaurant Interior design
By this point, you should have received nearly all of your equipment and furniture, including your tables, chairs, table tops, benches, canopy awning or canvas and more. That means it�s time to make sure everything fits, works and looks like it should.

Test all of your equipment. Check the walk-in and refrigeration temperatures. Calibrate the temperatures for your fryers and griddle, oven and stove. Also, set up and organize your supply stations, including shelving for walk-in and dry storage (which also must be labeled), and get your hostess stand supplies (reservation book, call clock, pencils, notebook) in order. While you�re at it, also post signs for your personnel, as well as the required posters for OSHA, FLSA, ADA, EOE, the Heimlich Maneuver and safe lifting. Also, finalize your hiring and get your employees into training.

Start a construction punch list in case final work needs to be done, and begin to clean and sanitize the walk-in area. Also, set your exterior signage light timer, place your initial alcoholic beverage order and determine light levels and label for each period of the day.

One week before

opening a restaurant

: Crunch time.
No task is too small during this stretch. Granted frustration will be high but if all preparations have been met beforehand, you should be able to sail into a successful and well-prepared

restaurant opening

.

First and foremost, get your d�cor and equipment ready. Hang inside d�cor, wash windows, install plants, clean all equipment, smallwares, and stainless steel, complete equipment warranty cards and run the ice machine, empty it, sanitize it and refill it. All the while, continue updating your construction punch list.

In addition, hold your final inspections, receive your certificate of occupancy, finalize your opening week schedules, finalize the clean-up of interior and exterior, complete your pre-opening checklist, take open inventory on all food and beverage items, and buy and receive your change from the bank.

In the meantime, also conduct your training, finalize your training certification and conduct a practice run (dress rehearsal) of opening night. After that, you should be ready for business. Congratulations!

Contact us to find out how Quantified Marketing Group can help your restaurant.

Workflow for Modeling a Schedule

http://www.alexsbrown.com/model-tough-sched.html

• Workflow for Modeling a Schedule

  By breaking schedule development into well-defined, discrete processes, the PMBOK suggests a workflow for building a schedule. In real life, building a schedule is often an iterative process, starting with a small, basic schedule, and building on it by adding phases or groups of tasks. Whether performed as a single pass or multiple iterations, experienced project managers perform these steps:

1. Build a Work Breakdown Structure (WBS)
2. Decompose the WBS into concrete activities
3. Define the sequence of activities (dependencies, predecessors, and successors)
4. Estimate task duration
5. Estimate task cost
6. Assign resources
7. Adjust cost and duration estimates based upon assigned resources
8. Perform initial resource leveling
9. Optimize the schedule

The final step, “optimize”, may include changes to all of the information entered earlier. Activities might be grouped together, activities might be decomposed, resource assignments may change, and estimates of cost or duration may grow or shrink.

During this “optimization” step, the manager probes the schedule, assessing the quality of the model of the schedule. Changing assignments and estimates should adjust the overall end-date with minimal effort. The better the model, the easier it is to optimize. The more fragile the schedule, the more unpredictable changes occur with each adjustment.

Often modern schedules are tightly constrained. They are designed to produce the maximum output, just-in-time, for a minimum budget. Optimizing tightly constrained schedules is difficult. Allow extra time for creating such schedules.

In the rush to produce a schedule, it is tempting to bypass critical steps. For instance, if a task “must” begin on a certain date, it is tempting to ignore activity sequencing for any predecessor to that task and to simply set a start date for it. If the manager shortcuts the process, the software cannot warn the manager of scheduling conflicts.

Some Tough Scheduling Problems

Resource Leveling

One of the enormous benefits of scheduling software is that it provides the manager with multiple, synchronized views of the project. Gantt charts are effective for communicating dates and network diagrams are effective for communicating dependencies. In the 1960s and 1970s, managers who used critical-path techniques had to manually draw and update these diagrams by hand. Any changes to the project scope meant updates to multiple diagrams, charts and lists. Today’s software automates this essential function. Users may edit data in one view, and the software will display up-to-date versions of all other views at the click of a button.

Theoretically, these advances should make it easy to keep a resource-leveled schedule. Indeed, modern software provides views that show the utilization of any resource in just about any unit, cumulative by date or for a particular period. With the entry of vacation calendars, holidays, resource availability over time, and other constraints, software can often show overallocation or underallocation of available resources automatically.

The key to accurate resource leveling is accurate, complete data. So many variables come together in this critical planning task:

• Resource start dates and availability
• Work estimates
• Duration estimates
• Activity sequence relationships
• Vacation schedules
• Holiday schedules
• Planning factors for unscheduled but known events like sick days
• Planning for schedule risk events

Resource leveling is the integration point for all these project elements.

Complexity increases with the use of scheduling software. It is possible to force a schedule to be resource-leveled strictly through the use of dependency relationships in most tools. Some tools offer automated systems to adjust resource allocations. Project managers should explore their tools thoroughly to understand the best techniques for their projects. Key questions for the project manager include:

• Is the method repeatable for future projects and for future reporting periods with this project?
• What if a key resource starts earlier or later than expected? How much data must be adjusted or re-entered?
• What if a single task takes more or less time than expected? How will the software respond?
• When there are two tasks that COULD start on the same date (but resource constraints will not allow them to), how does the software decide which one SHOULD start first? Does the software make decisions automatically? Can the project manager override any automated decisions easily?

Scheduling software is often designed for projects with serial dependencies. By adding “soft” dependencies to a schedule, it is possible to turn a project with many parallel opportunities into one with mostly serial dependencies. If a manager uses this technique,

• Where will the hard dependencies be documented?
• Will the software still accurately calculate key project measures, including critical path?
• When resources do work out-of-order, does the manager need to update the schedule? How will the software respond if the actuals do not match the planned activity sequence?

The better the manager understands his or her software tool, the less time is required for schedule maintenance.

Representing Task Dependencies — Hard and Soft

Task sequencing is often challenging with scheduling software. Some software will add sequencing rules to a schedule, making all tasks sequential automatically; many expert schedulers disable these features.

PMBOK distinguishes between dependencies that MUST be enforced (hard or mandatory) and dependencies that SHOULD ideally be enforced (soft or discretionary) (PMBOK 2000, 68-69). Many software packages do not make that distinction, enforcing all dependencies strictly. Some resource-leveling strategies require the use of many soft dependencies, compounding the problem.

Managers have a few options to work around these common problems:

• Use the software to enforce ONLY hard dependencies, and attempt to meet soft dependencies as part of resource-leveling steps
• Create an initial network diagram with only hard dependencies and maintain it outside the main schedule (especially useful when the project’s network diagram changes infrequently)
• Ignore the software’s network diagram and create one by hand
• Keep a spreadsheet or diagram of hard dependencies and soft dependencies – compare the schedule in the software to these lists regularly and update the software as needed
• Create custom views or use custom fields in the software to track hard and soft dependencies

Task numbering is often an obstacle in creating and synchronizing lists of tasks and dependencies. Most software numbers all tasks sequentially, and adjusts the number of every task as tasks are added or deleted. Often there is a hidden field that does not change that uniquely identifies each task. Use this number to effectively cross-reference between a spreadsheet or diagram and the data in the scheduling software. Alternatively, create task names that are unique within the project, and use these names as an effective cross-reference.

Managing and Maintaining Changing Schedules

“Everything flows on and on like this river, without pause, day and night.” -Confucius, standing by a river (Wilhelm 1987, lv)

The one unchanging principle that every project manager can count on is change itself. No matter how accurate the estimates, no matter how perfect the schedule, before the project is done, the schedule will change. Some tasks will start or end early, some will start or end late, and the project scope will expand and contract. Managing this change is the never-ending role of the project manager.

Managing schedule change is a requirement for many tough schedules. Fast-changing resource assignments, frequent changes to project scope, changes to budget, and changes to desired end-dates can make a project much more difficult to manage.

When creating a schedule for a brand new project, a manager should ask:

• What is likely to change?
• How much will it change?
• Will project changes come all at once, or a little with every reporting period?

The more the manager can anticipate change, the better he or she can plan for it. When creating the initial schedule, the manager can perform some “what-if” scenarios, seeing the effect of certain types of changes will be. Even if the exact changes cannot be predicted, the manager can develop scheduling techniques to address common sources of change:

• New tasks
• Old tasks no longer needed
• Resources are unavailable or new resources become available
• Resource start dates changing
• Changes to duration, work, and cost estimates

An expert scheduler can draw upon experience to address these situations. A novice needs to develop these techniques or learn from an expert. No matter what the experience level, though, any manager can benefit from identifying likely sources of changes and planning for them.

Modern software has opened new possible ways to model change, making uncertainty an explicit part of the project schedule. Software has been able to generate likely ranges of estimates based upon PERT estimates of likely, optimistic, and pessimistic outcomes for years. Monte Carlo simulation can be used to show the range of possible outcomes, and their relative probability. Many project managers do not need or use these tools, but for highly uncertain projects, they can be an essential feature of scheduling software.

Expert Use of Scheduling Software - Modeling Tough Scheduling Problems with Project Management Software

http://www.alexsbrown.com/model-tough-sched.html

lots more

Expert Use of Scheduling Software

Project managers with more expertise use scheduling software very differently. They create a model of the project in their software tool. They follow consistent steps to build up a schedule. They understand and override the default settings of their chosen software tool, manually specifying task dependencies and resource usage. Often they ignore predicted end-dates for tasks while entering key data. They wait until their schedule is complete and resource-leveled, then optimize the schedule to reach a desired end-date.

Expert schedulers run “what-if” scenarios on their schedules. They modify start and end dates for critical tasks; they ensure that the remaining project work moves in a realistic manner. They understand what their software will do if key tasks are actually done out-of-order. They regularly update their schedule based upon actual work completed, predicting a new end-date for the overall effort when necessary.

Every project manager comes up with his or her own habits when working with scheduling software. Scheduling software and experience drive these habits. Managers must develop a new mental map of the software. Experienced users view their software as a database manager, not a spreadsheet. They see their project files as a database of related facts, with many views to see the data from different angles. (Stover 2003, 7-8) They consult many views, including the network diagram and resource usage reports, even if they are never published.

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