Restaurants bring families together to share meals, and in many cases, businesses are owned and operated by families as well. Members of the older generation often hope to pass down what they’ve learned about cooking and serving customers to younger people – whether related by blood or otherwise involved in the business – who will carry on their establishment’s proud traditions. However, there’s a lot involved in successfully building a multigenerational legacy that goes beyond developing your skills in the culinary arts.
Ensuring a smooth transfer of a business between family members requires careful succession planning. There are several key steps involved in turning a restaurant over when the time is right, and it’s crucial to lay the groundwork in advance. Whether you’re still working toward a culinary arts certificate online or have been running a restaurant for decades, it’s never a bad time to start thinking about the future.
1. Develop a vision for the future
“Building a business that will last many years starts with clearly defining objectives.”
Building a business that will last for years to come starts with clearly defining objectives and laying a strategy for moving forward. It’s wise to put these goals and plans in writing so that everyone involved in the transition understands what’s ahead and the roles they will play. Think about what aspects of the restaurant give it identity and have made it successful in the past, as well as how it will need to evolve in the future.
While you may want to keep ownership of the restaurant in the family, that doesn’t mean you shouldn’t seek an outside perspective. When making important business decisions, it’s good to hear from someone who understands the financial and regulatory issues involved and is capable of impartially judging your plans. Professional advice from a lawyer who specializes in estate planning or the restaurant business can be a huge benefit as you prepare for succession and retirement.
2. Get finances in order
The day-to-day economic realities of running a restaurant can be complex, especially as business fluctuates with the seasons or other outside considerations. Restaurateurs must always take into account the costs for paying employees, covering the rent or mortgage, purchasing ingredients and supplies and handling routine maintenance, among other expenses.
However complicated their balance sheet may become, no one wants to entangle their family members in a financial mess. As part of succession planning, owners should always think about how they can turn over their establishment on a solid footing for continued operations. That includes paying the tax bill, minimizing debts and setting plans to keep revenue growing.
3. Train the next generation of leaders
Restaurants thrive when they have a powerful brand, passionate individuals working at every level and, above all, great food and service. To keep a business on track after it changes hands, the current owners have to prepare others to take on new roles. Gradually moving responsibilities over is a great way to teach people to handle essential duties, and this approach prevents a sudden switch that could be jarring for customers and staff alike.
Part of this process is determining a post-transition role for the former owner. It’s important to let fresh leadership stretch their legs and put their own stamp on the business, but someone with years of experience can be a valuable resource. Departing restaurateurs often take on part-time advisory roles so they can assist their family members when tricky questions come up.
The skills that students learn in culinary academy can build restaurants or catering companies that last for many years and through multiple owners. By exploring how to streamline the process of business succession, you increase the chances that the establishment you poured so much effort into continues to bring people together for many more years.