A family style restaurant is a restaurant that is specifically designed to accommodate families. In family style restaurants, food is served on large platters meant for sharing, rather than as individual plates. Customers serve themselves from the food platters, just like they do when they are dining at home.
It is important to state that family style restaurant is a subset of the restaurant chain industry and statistics has it that the sector in the United States was valued at approximately 128.99 billion U.S. dollars in 2020, down from the previous year’s total of 158.86 billion U.S. dollars. In 2022, the size of the sector was forecast to reach 149.57 billion.
Steps on How to Start a Family Style Restaurant Business
Table of Content
Conduct Market Research
It is important to note that starting a family style restaurant business requires reliable market research to be able to maximize profits from the business. Please note that the first step in the market research process for your family style restaurant business should be to develop market-based research questions in line with your overall business goal and objective.
In this regard, you should source for information that will help you maximize your business, give you reliable hint of what your potential market will be looking out for from a family style restaurant and also help you operate your family style restaurant business with less stress and of course, build the business to profitability.
a. Who is the Target Market for Family Style Restaurant Business?
Every family in and around the location where you have your family style restaurant. An important factor to note in this regard is that forty-five percent of Millennials and 57 percent of Hispanic consumers visit family-style restaurants once a week, compared to just 41 percent of all consumers polled.
b. Is Family Style Restaurant a Profitable Business?
Yes, the family style restaurant is a profitable business. The industry is worth over 128.99 billion U.S. dollars in the United States.
c. Are There Existing Niches in the Industry?
Although, family style restaurant is a niche idea in the restaurant chain industry, it is important to state that a family style restaurant can decide to operate under any theme.
It could be;
d. Who are the Major Competitors?
- Applebee’s International, Inc.
- Olive Garden
- On the Border Mexican Grill and Cantina
- LongHorn Steakhouse
- The Cheesecake Factory
- Claim Jumper
- California Pizza Kitchen
- The Cheesecake Factory
- Chevy’s Fresh Mex
- Chili’s Bar & Grill
- Cici’s Pizza
- Legal Sea Foods
- Olive Garden
- F. Chang’s China Bistro
- Red Robin
- Sonny’s Real Pit BAR-B-Q
- Souplantation/Sweet Tomatoes
- Texas Roadhouse
- Ted’s Montana Grill
- Uno Chicago Grill.
e. Are There County or State Regulations or Zoning Laws for Family Style Restaurant Business?
Yes, there are county, state regulations and zoning laws for family style restaurant businesses in the United States. Please note that the Food and Drug Administration (FDA) sets the federal Food Code, but it doesn’t oversee individual family style restaurant businesses. Instead, the various states use the Food Code as the basis for their own food codes. They may adopt its rules, interpret them differently or set their own rules.
Please note that in the United States, you are required to follow your state’s food service code. Visit the FDA website for a list of food service codes by state. Use this to find the state authority handling restaurants and bars and view the laws that apply in your state.
f. Is There a Franchise for Family Style Restaurant Business?
Yes, there are franchise opportunities for family style restaurants, and here are some of them;
- Tony Roma’s
- Golden Corral
- Perkins Restaurant and Bakery
- All American Steakhouse and Sports Theater
- Blue Coast Burrito
- Huddle House.
g. What Do You Need to Start a Family Style Restaurant Business?
- A Feasibility Report
- Business and Marketing Plans
- Business Licenses and Permits
- A Good Restaurant facility
- EIN (Employer Identification Number)/Federal Tax ID Number.
- A Corporate Bank Account
- Suppliers of food ingredients and drinks
- Startup Capital
Memorable Family Style Restaurant Business Names
- Merry Hearts© Family Style Restaurant, Inc.
- Oak Springs® Family Style Restaurant, LLC
- Oasis Foods© Family Style Restaurant, Inc.
- Food Nest® Family Style Restaurant, Inc.
- Wealth Beakers™ Family Style Restaurant, Inc.
- Good Times™ Family Style restaurant, LLC.
- Feather Clips© Family Style Restaurant, LLC
- Food Court® Family Style Restaurant, Inc.
- Family Nest© Family Style Restaurant, Inc.
- Time Out© Family Style Restaurant, Inc.
- Together Joint® Family Style Restaurant, LLC
- Mackey Chickens™ Family Style Restaurant, LLC
- Periwinkles© Family Style Restaurant, Inc.
- Food Topia® Family Style Restaurant, Inc.
- Agrrey Martins™ Family Style Restaurant, Inc.
- Madam Theodora™ Family Style Restaurant, Inc.
- The Food Queen© Family Style Restaurant, Inc.
- Chef Nations® Family Style Restaurant, LLC
- Fantastical© Family Style Restaurant, Inc.
- Richard George© Family Style Restaurant, Inc.
Register Your Business
a. What Type of Business Structure is Best for Family Style Restaurant?
There are several options when it comes to the business structure of a family style restaurant, but the one most players in this line of business consider is an LLC. It is common to consider an LLC because providers want to protect themselves from lawsuits.
Please note that an LLC will need an EIN if it has any employees or if it will be required to file any of the excise tax forms listed below. Most new single-member LLCs classified as disregarded entities will need to obtain an EIN.
b. Steps to Form an LLC
- Choose a Name for Your LLC.
- File Articles of Organization.
- Choose a registered agent.
- Decide on member vs. manager management.
- Create an LLC operating agreement.
- Comply with other tax and regulatory requirements.
- File annual reports.
c. What Type of License is Needed to Open a Family Style Restaurant Business?
- General Business License
- Health and Safety Permit
- FSSAI license
- Food Handler’s License
- Liquor license
- Health and trade license
- Lift clearance license
- Zonal Permits
- Signage Permit
- Operational State Facility Inspections
- A live entertainment license if you want to provide entertainment such as live music or offer dancing or karaoke.
- A music license if you want to play live, recorded or stream music in your family style restaurant
- A dumpster placement permit that specifies where you can put your dumpster outside your restaurant
- A valet parking permit if you plan to offer valet parking for customers
- Sidewalk permits if you plan to offer outside seating
d. What Type of Certification is Needed to Open a Family Style Restaurant Business?
These are some of the certifications you can work towards achieving if you want to run a family style restaurant;
- Clean Health Certificate
- Food handler Certification
- Catering Training Certificate
e. What Documents are Needed to Open a Family Style Restaurant Business?
- Business and liability insurance
- Federal Tax Payer’s ID
- State Permit and Building Approval
- Certificate of Incorporation
- Business License
- Business Plan
- Employment Agreement (offer letters)
- Operating Agreement for LLCs
- Insurance Policy
- Contract Document
- Company Bylaws
- Memorandum of Understanding (MoU)
f. Do You Need a Trademark, Copyright, or Patent?
If you are considering opening a family style restaurant business, usually you may not have any need to file for intellectual property protection or trademark. This is because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.
Cost Analysis and Budgeting
a. How Much Does It Cost to Start a Family Style Restaurant Business?
There is no clear-cut startup cost for a family style restaurant, but available data shows that the cost for a small to medium sized family style restaurant can range from $450,000 to over $1 million.
b. What are the Costs Involved in Starting a Family Style Restaurant
- Business Registration Fees – $750.
- Legal expenses for obtaining licenses and permits – $3,300.
- Marketing, Branding and Promotions – $2,000.
- Business Consultant Fee – $2,500.
- Insurance – $8,400.
- Rent/Lease – $200,000.
- Other start-up expenses include, stationery ($500), and phone and utility deposits ($1,800).
- Operational Cost (salaries of employees, payments of bills et al) – $70,000
- Start-up Inventory – $35,000
- Store Equipment (cash register, security, ventilation, signage) – $1,750
- Furnishing and Equipping the Restaurant – $150,000
- Website: $600
- Opening party: $3,000
- Miscellaneous: $2,000
c. What Factors Determine the Cost of Opening a Family Style Restaurant Business?
- The size of the family style restaurant
- The choice of location
- The required licenses and permits
- The type of facility
- The type of food and related products retailed in the restaurant
- The cost for branding, promotion, and marketing of the family style restaurant
- The cost for furnishing and equipping the facility
- The cost of insurance
- The cost for registering the business
- Source of your food ingredients, supplies, and ongoing expenses
- Cost of recruiting and training your staff
- The cost for the purchase and customizing of uniforms,
- The cost for the grand opening of the family style restaurant business
d. Do You Need to Build a Facility? If YES, How Much Will It Cost?
In reality, it is not compulsory to build a new facility for your family style restaurant, but if you have the required finance, it will pay you to build your own facility. The truth is that building or reconstructing a facility will help you come up with a facility that will perfectly fit into your overall business goals and vision.
e. What are the Ongoing Expenses of a Family Style Restaurant Business?
- Supplies (inventory expenses)
- Utility bills (internet subscriptions, phone bills, signage and software renewal fees et al.)
- Salaries of employees
f. What is the Average Salary of your Staff?
- Chief Executive Officer (Owner) – $65,000 Per Year
- Human Resources and Admin Manager – $43,000 Per Year
- Restaurant Manager – $40,000 Per Year
- Accountants/Cashiers – $33,000 Per Year
- Chefs (Cooks) – $30,000 Per Year
- Waiters/Waitress – $26,000 Per Year
- Cleaners – $25,000 Per Year
- Security Guard -$24,000 Per Year
g. How Do You Get Funding to Start a Family Style Restaurant Business
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell shares to interested investors
- Applying for a loan from your bank/banks
- Source for soft loans from your family members and friends.
Write a Business Plan
a. Executive Summary
Chef Nations® Family Style Restaurant, LLC is a world-class restaurant business with a niche in family dining services that will be located in San Francisco County, California. We are deliberate about our business location because San Francisco County can boast of per capita personal income of over $100,000, and is among 2 of the top 12 highest-income counties in the United States. We have been able to secure a long-term lease agreement for a standard restaurant facility in a perfect location in the heart of the city.
b. Products and Service
- American food sales
- Intercontinental food sales
- Assorted wines
c. Mission Statement
Our mission is to establish a standard and world–class family style dining restaurant business that will sell franchises all across the United States of America and other countries of the world. We want to become a household name.
Our vision is to become the leading family style restaurant in San Francisco, California, and in other cities in the United States of America.
d. Goals and Objectives
The goals and objectives of a family style restaurant is to provide an outlet where families can dine together, and to offer moderately priced menus featuring a mix of classic cuisines and often individualized with signature sauces, dips, or other toppings.
e. Organizational Structure
- Chief Executive Officer (Owner)
- Human Resources and Admin Manager
- Restaurant Manager
- Chefs (Cooks)
- Security Guard
a. SWOT Analysis
- Ideal location for a family style restaurant business
- Highly experienced and qualified employees and management
- Access to finance from business partners
- Availability of different types of delicacies
- Moderately priced menu
- Table service, rather than counter service
- Full bar, usually separate from the dining room
- Reliable and efficient inventory management system.
- Financial constraints may restrict the publicity and branding of the business
- A new business that will be competing with well-established family style restaurants and other restaurants in the city.
- Inability to retain our highly experienced and qualified employees longer than we want during the teething stage of the business.
- A rise in the number of families within our market space
- Online market, new services, new technology, and of course the opening of new markets.
- The arrival of new family style restaurant within our market space
- Economic uncertainty
- Liability problems
- The U.S. Food and Drug Administration (FDA) could change its regulatory status and decide to enforce strict regulations that can strangulate new businesses like ours.
b. How Do Family Style Restaurants Make Money?
Family style restaurants make money by selling the following products;
- American food sales
- Intercontinental food sales
- Assorted wines
c. Payment Options
- Payment with cash
- Payment via credit cards
- Payment via online bank transfer
- Payment via check
- Payment via mobile money transfer
d. Sales & Advertising Strategies
- Introduce your family style restaurant by sending introductory letters alongside your brochure to religious organizations, clubs, corporate organizations, households, and other key stakeholders throughout the city where your family style restaurant is located.
- Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, LinkedIn to get your message across
- Create a basic website for your business so as to give your business an online presence
- Directly market your family style restaurant.
- Join local family style restaurant business associations for industry trends and tips
- Provide discount days for your customers
- Advertise our business in community-based newspapers, local TV and radio stations
- List your business on yellow pages ads (local directories)
- Encourage the use of word-of-mouth marketing (referrals)
a. How Much Should You Charge for your Service?
The price of a family meal in a family style restaurant depends on the number of diners and the type of food. For example, a three-course meal for 2 people in a mid-range family style restaurant is between $40 to $100.
b. How Much Profit Do Family Style Restaurant Owners Make a Year?
It depends, but available reports show that on average, family style restaurant owners make anywhere from $31,000 a year to $155,000. They also estimate that the national average is around $65,000 a year. Chron.com estimates a similar range, between $29,000 and $153,000 per year.
c. What Factors Determine the Amount of Profit to Be Made?
- The capacity of the family style restaurant
- The types of food, snacks and other drinks retailed in the shop
- The location of the family style restaurant
- The management style of the family style restaurant
- The business approach of the family style restaurant
- The advertising and marketing strategies adopted by the family style restaurant.
- The number of years the family style restaurant is in business
d. What is the Profit Margin of a Family Style Restaurant?
You can expect a net profit margin of around 10 to 25 percent for a family style restaurant.
e. What is the Sales Forecast?
Below is the sales forecast of a family style restaurant. It is based on the location of the business and other factors as it relates to such startups in the United States;
- First Fiscal Year: $1.2 million
- Second Fiscal Year: 2.5 million
- Third Fiscal Year: $4.2 million
Set Up your Shop/Office
a. How Do You Choose a Perfect Location for Family Style Restaurant?
- The demography of the location especially as it relates to families
- The demand for family style dining in the location
- The purchasing power of the residents of the location
- Accessibility of the location and the road network
- The number of family style restaurants, and regular restaurants in the location
- The local laws and regulations in the community/state
- Traffic, parking and security et al
b. What State and City are Best to Open a Family Style Restaurant?
- New York City, New York
- San Francisco, California
- Dallas-Fort Worth, Texas
- Atlanta, Georgia
- Boston, Massachusetts
- Palm Beach, Florida
- Washington, D.C.
- Scottsdale, Arizona
- Portland, Oregon
- Asheville, North Carolina
- Las Vegas, Nevada
- Los Angeles, California
- Washington DC
- Chicago, Illinois
c. What Equipment is Needed to Operate a Family Style Restaurant?
Before you open a family style restaurant, you should get chairs and dining tables, POS and receipt issuing machines, storage hardware (bins, rack, shelves, food case), counter area equipment (countertop, sink, ice machine, etc.), (Flat Screen TVs, sound system, DVD players, cooking gas, deep freezers, fridge, blenders, store equipment (cash register, security, ventilation, signage), serving utensils (plates, ashtrays, glasses, flatware) and fancy lightening amongst others.
When it comes to hiring employees for a standard family style restaurant, you should make plans to hire a competent chief executive officer, human resource and admin manager, restaurant manager, chef (cook), waiters and waitresses, cleaners, and security guard.
Launch the Business Proper
In recent times, no family style restaurant opens its door for business without first organizing an opening party to officially launch the business. You can choose to do a soft opening if you are operating on a low budget or you can go for a grand opening party.
The bottom line is that with proper launching of the family style restaurant, you will officially inform people in your city that your restaurant is open for business.
a. What Makes a Family Style Restaurant Business Successful?
- Choose a good location to launch the business
- Make sure you offer a wide variety of foods and drinks (give your customers options)
- Throw an open house grand party before officially opening the family style restaurant business
- Be deliberate with your marketing sales approach
- Encourage the use of word of mouth to promote your family style restaurant business
- Leverage on all available online and offline platforms to promote your family style restaurant business
b. What Happens During a Typical Day at a Family Style Restaurant?
- The restaurant is open for the day’s work
- The kitchen staff prepares the food and snacks
- The serving areas, serving wares, chairs, and tables are properly arranged
- Customers are attended to
- Stocks are taken and reports are written and submitted to superior officers
- The business is closed for the day.
c. What Skills and Experience Do You Need to Build a Family Style Restaurant Business?
- Excellent culinary skills
- Excellent customer services skills
- Interpersonal skill
- Accounting and bookkeeping skills
- Business management skills
- Bargaining skill
- Work experience in a family style restaurant or niche restaurant
- Experience in managing people
- Experience in business administration
- Experience in preparing a wide variety of delicacies.