June 29, 2020

While the “arts” in the culinary and pastry arts are exciting, it’s Auguste Escoffier School of Culinary Arts’ balanced, business-focused curriculum that attracts many students to study here.

In this article, we throw back the curtain and give you a “sneak peek” into Escoffier’s culinary entrepreneurship course. In this class, culinary students are tasked with writing a full business plan for a restaurant, or other food service business, under the guidance and mentorship of Chef Instructors who have been entrepreneurs themselves.

Mentorship is crucial for success—not just in the food business, but in any walk of life. According to a study by Cornell University, over 26% of restaurants don’t survive the first year and nearly 60% fail by the third year. Although there are no guarantees in life and especially in business, with a little preparation, education, and mentorship, you can avoid many of the pitfalls that upend others.

That’s why creating a solid restaurant business plan is so important. It gives you an opportunity to put concrete structure around your thinking and look at the logic of your ideas from a higher viewpoint before spending a single dollar.

Here are the steps Escoffier teaches in its business planning process:

Define Your Mission Statement & Business Concept

Before launching into the technicalities of what your business will be, you will need to determine why it exists. What is the core mission behind your business? What are the main values that you want to emphasize?

A good mission statement is concise, outlines the value the business provides to customers and employees, and typically sets an inspirational objective. A good example is The Kitchen, a restaurant in Boulder, Colorado, which states its mission as:

“We believe in the power of good food and good drink to connect people as family, friends and a community. The Kitchen remains committed to our mission of creating community through food.”

Verbalizing the bigger picture as a stated mission gives your business depth beyond just making money. When you use it as a guiding principle, it will be reflected in your marketing, operations, and the attitudes of those who join your team.

A great framework for doing this is a PESTEL or SWOT analysis. In Escoffier’s entrepreneurship course, you will get a chance to identify the current Political, Economic, Social, Technological, Environmental, and Legal forces that your business can encounter or find opportunity in.

 SWOT Analysis chart on a notebook

Create a Marketing Plan

Escoffier’s entrepreneurship course teaches why it’s important to have a good understanding of your target audiences and how you will market to them. Many restaurant consumers’ habits have changed due to COVID-19, and you’ll need to appeal to these new trends within your marketing plan.

The first step is to identify who your ideal customer will be. What is their age, gender, and income level? What do they like to eat? What are their wants and needs? What are their typical habits? Will you be targeting specific dietary profiles, like vegan, paleo, or gluten-free?

You’ll also need to consider location, which is critical for retail establishments. If patrons can’t find you, or don’t know you exist, you’ll be in trouble before you even start. In your business plan’s market overview, you’ll examine how other restaurants are doing in the neighborhood where you want to locate.

The best locations for your business concept will be areas where your ideal customers congregate the most during the time you are open. In fact, the best restaurant locations are often where your competitors are already experiencing success. Customers like having a diversity of options…that’s why it’s possible for many businesses to profit simultaneously in one geographic area.1

Great restaurant marketing plans are flexible and able to pivot on the fly.

Pascal Simon, a graduate of Escoffier’s Pastry Arts program, created a unique business when she founded Bake Austin, LLC as an enrichment program for kids and adults. When stay-at-home orders during the coronavirus pandemic threatened her business, Pascal adapted and took her classroom online to continue serving her target market. That’s entrepreneurial marketing for you: flexibility, creativity, and perseverance in difficult times.

Build Your Menu

Consumers will evaluate your restaurant’s menu more than any other aspect in your restaurant…and not just the physical menu at your place of business.

According to research by OpenTable, 86% of customers will “always” or “frequently” look up a restaurant’s menu online before they choose where to dine. So make sure your website, and especially your menu, do a good job of advertising the kind of experience you hope to deliver to your patrons. Notice, for example, how the website and menu of the Kitchen in Boulder are congruent with their mission of “creating community through food.”

As for preparing and serving items on your menu, Escoffier teaches how to come up with a selection of dishes, establish standardized recipes, perform yield testing (determining how many portions each recipe produces), and how to cost each item on the menu. Each of these steps have many underlying details, and all of them are critical for running a successful restaurant.

Again, that’s why a great culinary school must deliver on the art of cooking and the hard-nosed business skills that make a venture profitable. You must balance the “artistic” and “business” sides of your education.

Couple with menu and two wine glasses in a restaurant making order

A great restaurant menu is specifically designed to appeal to your target market and will have a mix of crowd-pleasing items and unique dishes. A menu that is composed entirely of creative but hard-to-find ingredients will significantly raise costs and demand more training from your cooking staff.

Your menu’s pricing will also be a reflection of your target demographic: a fast-casual restaurant will obviously be less expensive than a fine-dining establishment, but both can be equally profitable depending on turnover. A good rule of thumb is to maintain budgeted food costs between 28 and 32% of your menu price.1

Determine Your Facility Design

Escoffier’s culinary entrepreneurship course also covers how to create your restaurant’s ambiance, which is largely determined by its layout and furnishings. You should have a plan for your facility that includes your intended physical features of the restaurant, such as estimated seating, spacing, and all the equipment you’ll be using in the kitchen.

Your restaurant’s design will be the first thing consumers experience when they walk through the door. It sends a silent message about the kind of service and experience they are likely to receive.

Cafe restaurant interior

The kitchen is the most expensive part of a restaurant’s total cost and is also the area where most money is inefficiently spent.1 Tanya Shea, a consumer branding and design expert from Shea, Inc., explains that a kitchen should never exceed “more than 1/3 of the total space” of a restaurant – including storage space.

Having a strong understanding of facility design means you need to have a strong understanding of front of house and back of house operations. After all, how can you implement a great facility design in your business plan if you’ve never had real first-hand experience with operations at a restaurant?

How do you learn what goes into delivering one experience or another? By rolling up your sleeves and getting to work. Escoffier’s curriculum includes an industry externship with some of the top culinary employers in the country – supplementing theory with real industry experience in a restaurant, hotel, or other foodservice establishment.

This exposure provides first-hand experience to students to help them understand which front of house facilities enhance the customer experience, the equipment needed in the kitchen, whether or not to play music, what the air temperature should be, and more. There’s no substitute for real-world experience.

Choose Your Management Structure

Entrepreneurship is challenging and nearly impossible to pull off solo. A great plan without a great team is likely to fail. An important part of the business plan Escoffier teaches is determining the various roles and responsibilities on your team.

For instance, depending on the size of your business, your plan should include an organizational chart that explains which position is reporting to whom, how many people you will be hiring, the main skill sets of the management team, and the unique things that each person brings to the table.

Many students in culinary school meet fellow culinarians who end up being valuable friends, or even business partners later in their careers.

Paige Pospisil and Julie Ratzesberger are a great example of two culinary entrepreneurs who benefited from the entrepreneurial environment at Escoffier. The two met while taking part in the Culinary Arts program in Austin and decided to start their own fresh, local goods business Elgin Local Goods.

Paige explains that “it’s not all about what you learn in the school, but also your experience in the kitchen. You get taught the foundations at school, and Escoffier did a really good job with that part of it.”

Business is ultimately about the relationships between people, and culinary school is a ripe environment to build those critical connections that can serve you down the road.

Forecast Revenue

Anyone who is looking to launch a foodservice business probably wonders how much the whole endeavor is going to cost, and what the return on investment might be. As a future business owner, you need to be aware of the fundamental costs of business and what you can do to ensure that it becomes a profitable venture.

Restaurants have profit margins that are relatively low compared to other businesses. That’s why Escoffier’s business plan requires you to have a sound awareness of financial planning and kitchen operations.

Chef Robert Irvine, host of the popular Food Network show Restaurant: Impossible, notes that a lack of awareness of food costs, labor, and income statements are the bane of many current and aspiring restaurant owners. In one particular case, he describes how an owner “was so proud of himself for being able to report a 33% food cost until I dug a little deeper to see that his costs were based on old figures, and that the cost of ingredients had risen significantly since he last did his calculations.”

Businessman writing on paper graph and holding smartphone searching data

Your business plan should detail the financing that will be required to get your business up and running, the associated costs of marketing and staff, as well as variable costs such as ingredients. Different restaurants have different cost structures and capital requirements. For example, fast food establishments and full-service restaurants typically have very different profit margins.

Your business plan should be sufficiently detailed to estimate the profits and expenses for the first few years of your business, in order to ensure that your plan is economically feasible.

A key part of Escoffier’s curriculum for the Associate of Occupational Studies Degree in Culinary Arts goes over managerial accounting concepts, culinary math, and how to read financial statements. It explains the practical application of these concepts to specific operations within the hospitality industry and how to manage costs for long-term profitability.

A Well-Rounded Culinary Education Means Preparedness

While it is obvious that you need a passion for the world of food and drink before launching a food service business, starting any venture is difficult without mentorship from professionals who have real-world experience.

Now that you’ve built your business plan, it is vital to get feedback from experts in the field.

Escoffier’s courses are a blend of culinary theory and practical, hands-on experience with business operations. You’ll have the opportunity to get feedback from culinary professionals with practical business knowledge of the foodservice industry.

Simply having general business knowledge without knowing the intricacies of how to deliver quality food, customer service, and kitchen operations isn’t enough to build a winning business in foodservice. Entrepreneurs must find a way to do all of those things and turn a profit.

Again, many restaurants fail within the first few years not because starting a restaurant is a bad idea, but because entrepreneurs never take the time to learn from others who have already been successful at running restaurants.

As the famous celebrity chef and restaurateur Mario Batali explains, “The skills aren’t hard to learn. Finding the happiness and finding the satisfaction and finding fulfillment in continuously serving somebody else something good to eat is what makes a really good restaurant.”

…as long as it turns a profit.

Consider supplementing your journey in culinary entrepreneurship with Escoffier’s degrees and diplomas in Culinary Arts, which include an industry externship for hands-on training in a professional kitchen.

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Source: 1 Arth, Alison, “How to Open a Restaurant”, OpenTable 2016