Honestly speaking! Most people think doing restaurant business is kind of a lucrative & profit-making business. But people often forget to mention the difficult part of building a restaurant business and then taking it to a successful stage.
Every restaurant owner hughley invests dedication, effort, & time in planning, structuring, maintaining and retaining customers. Until, “You”yourself becomes a restaurant owner, and practically face the scenario of the inside picture.
Moreover, realise how difficult it is to be a restaurant owner? How much do restaurant owners make?, and how much do a restaurant make in a day?.or how much do high end restaurant owners make?
Furthermore, there are some general steps which every restaurant follows before starting a restaurant business. For instance, search for the best niche, analyse the competitor, calculate the expense cost, select for your restaurant location & restaurant name.
In this blog; I will break down all the pieces and try to show you a deep analysis so that you can calculate your number properly both how much a restaurant owner earns and the range of a restaurant owner's salary.
How Much Do Restaurant Owners Make??-Statistical Figure
Yes, the restaurant business is one of the most popular and profitable industries, you can make easy profit. But, this might be untrue for some restaurant entrepreneurs, and the reason behind could be various, for instance lack of marketing, budget problems, unskilled chef, no plan for customer retention etc.
However, it’s totally up to the restaurant owner how he/she wants to run the restaurant and what restaurant niche to choose. But, if you’re seeking an estimated number of how much do restaurant owners make then you can check out Payscale.com, Chron.com, & Simply hired.com.
According to Payscale.com, the estimated salary range of a restaurant owner is around $31,000 to $155,000 a year. And the exact number of 2023 average salary of a restaurant owner is $72,358.
According to Chron.com, apart from salary, a restaurant owner can make extra income through such ways for instance, tips, bonus, or profit share. But incase of how much do restaurant owners make, Chron.com suggested the average salary range is almost similar to Payscale.com; from $29,000 to $153,000 a year. But the exact number of 2023 average salary of a restaurant owner is $60,000 per year.
According to Simply hired.com, a small to midsize restaurant owners’ average salary is around $17838 to $54436 per year. But the exact number of 2023 average salary of a restaurant owner is $97925 per year.
Lastly, according to Ziprecruiter.com, starting from small to high size restaurants, a restaurant owner’s national average salary is $19,500 to $333,000 per year. And the exact number of 2023 average salary of a restaurant owner is $97173 per year.
Indeed, different secondary courses will have different numbers or ranges. But it is wise if you gather information from any entrepreneur who is engaged in the restaurant business, then you might get a genuine estimated number of how much do restaurant owners earn.
Although, if you are or planning to be a restaurant owner, you have to keep that in mind; unless the restaurant reaches a successful profit margin, you will not earn market standard salary.
Because a restaurant owner gets very less than 50% of the annual profit. And if the restaurant fails to reach that profit margin or even the break-even point then it will definitely make a major impact on your salary.
Disclaimer##This numerical value can be changed time-to-time. So, don’t take this number for granted; this number might fluctuate yearly/monthly and totally depends on the sale, success, and revenue.
Certainly, for every restaurant owner, it's a tough journey to stand out among a million competitive restaurants. Being a restaurant entrepreneur is not like any 9 to 5 job, instead it's your own business, where you can’t claim any salary, but can enjoy year-end profit, if you can achieve it.
And if I say more precisely, a restaurant owner’s ''earning” or ''salary” or even “profit share” typically depends on the success of the restaurant.
Restaurant owners don't have any fixed salary or earnings. Usually after a restaurant owner makes revenue, he/she primarily pays all the maintenance bills and suppliers costs, payroll, re-investment-capital etc. Then take whatever amount left is the restaurant owner shares.
It’s quite an important aspect to understand and acknowledge all the responsibilities that a restaurant owner must fulfil. The restaurant owner's responsibility depends on the level; how much he/she is involved in the business.
Mandatory Responsibilities That A Restaurant Owner:
Kinda Complex Question To Answer!!! Right??
There is no specific, fixed, or mandatory rule book, which you can follow to become a successful restaurant owner or to build a restaurant and become popular overnight. It all depends on your strategy; the plan you decide to operate your restaurant business.
Just be on your own, show your 100% dedication and passion, select your niche, research your competitors, and sketch your restaurant business plan.
Whether the restaurant business is or will be profitable; that totally depends on the strategy you plan for your restaurant. As I mentioned above, there is no mantra for making a restaurant business profitable.
Besides, there's no guarantee that your restaurant will become successful. But if you have that dedicated passion to understanding the market, competitors, and customers’ taste buds, then come up with some unique set of strategies of yours.
You definitely can achieve something!! People always want something unique, satisfying, and exciting, and an easy way to viral yourself.
If you compare restaurant business with other industries, such as hotels, e-commerce, telemedicine, automobiles, etc. You will find out. The restaurant business is an easy yet quick profitable business scheme.
There’s no fixed amount set; on how much average income a restaurant is gonna make every year/month, as it totally depends on the sale.
Based on my secondary research, approximately it would be around $112000 every month. This is an estimated ideal amount; a restaurant business earns every month. Based on the monthly revenue, this amount is not guaranteed and can be higher or lower up to 2%-6%.
Unlike the average income earned by the restaurant, the average profit by a restaurant is also very predictable. Because profit depends on the income you achieve at the end of the year /monthly.
Profits vary from time to time, it’s tough to guarantee that a restaurant is able to achieve profit every month. The restaurant might show some slow growth in the revenue graph or only be able to reach the break-even point, especially at the initial stage.
As we have forecasted based on some secondary sources, an estimated monthly average profit margin earned by a restaurant is 2% to 6%. Some special tricks can guarantee your profit, such as lowering some of the overhead and unnecessary expenses and planning a strategic marketing strategy to viral your restaurant.
Choose your restaurant’s geographic location and concept wisely because your target customers’ consumption habits hugely impact your restaurant’s popularity and sales.
Restaurants make money through selling food and service. A customer goes to a restaurant to consume good/delicious food, satisfying their hunger and expecting to enjoy the food in a comfortable and calm environment.
A restaurant owner has to fixate the price of the food items in such a way; which must cover all the fixed and variable costs involved to manufacture that dish. And calculating all kinds of costs helps you decide the price range and figure out the prime cost and targeted profit.
This calculation starts with, calculating how much inventory is needed per day or monthly. Forming an inventory calculation chart may help you to figure out unused raw material, reduce wastage, and maximize profit.
Selecting the most appropriate restaurant concepts is quite a difficult task. It can only be decided; only after you’re done with brainstorming, market research, analyzing the competitor, and selecting the target customers.
Budget, geographical location, food item, and existing competitors are the major factors that will hugely influence your decision of choosing the right restaurant category. Here are some profitable yet popular restaurant categories:
If you have a very limited or low capital budget, then a food truck or cart would be the best restaurant category for you. Because, this kind of transportable restaurant usually offers a very limited menu item, no or low overhead cost such as rent, electric and dine-in maintenance cost, etc. A food truck/cart is a transportable restaurant; therefore, it’s moveable, as a result, you can attract as many customers as you want.
Recently cloud kitchen; the most trendiest restaurant niche among the list of restaurant categories. Cloud kitchen is a virtual kitchen, the restaurant admin will receive orders over the internet and the delivery man will reach the order to the customers’ door-step. Cloud kitchens don’t have dine-in facilities, just order and pick-up, therefore reducing the maximum overhead cost.
Another great restaurant category for your restaurant business is a coffee shop where people seek comfort, and strong refreshing coffee is complemented with some delicious dessert. A cosy place to hang out with friends yet a formal place to perform business meetings.
Choose this restaurant category wisely, because it requires a huge amount of capital budget. The mark-up cost for alcohol and non-alcoholic beverages is quite expensive compared to food.
The bar & breweries restaurant niche earns almost 60% to 70% profit margin. If you choose this restaurant concept, the main problem you might face is getting the clearance certificate and alcohol selling permit from the government.
This type of restaurant offers a complete meal facility, such as appetiser, salad, main course, dessert, etc. Fine dining restaurants can be of many types; middle, classy, and upscale. Maintaining an elegant interior with a comfortable atmosphere is mandatory.
Who doesn’t like fast food!!!, burger and pizzerias restaurant concept is the safest and easiest profitable restaurant business idea a restaurant owner can ever choose. The demand for burgers and pizza will never end, it’s the most likable restaurant category by the customers and an average capital budget would be required to start this category of business.
Don’t worry!! Unlike any other business, restaurant business can also fail, but at the same time can be recovered from the loss easily if you follow some special tricks:
After your restaurant starts doing business, try to observe and gather; which dishes customers are liking more and what changes customers demand. You can arrange a “review your food” card for the customers so that you can bring the desired changes to your restaurant.
You can call this strategy a marketing strategy for your restaurant, as this item will be available for a limited time. Besides having a huge opportunity to explore and experiment with different things, which somehow help chefs to track their taste buds.
Always try to make customers think that they’re always right, hence bringing out their actual genuine demand; as a result, it can improve your menu or any particular dish.
Try to keep the menu easy, simple, and full of visual images of the food item. Too many complicated menus might irritate your customers and lose interest because of ordering the wrong dish.
A consistent and monotonous on/off the job training is always required for the hotel & restaurant industry, as these both fall under the hospitality industry. Waiters and kitchen staff need continuous improvement and training to improvise and act according to the customers' needs.
Since we’re leading in a digital era, maximum people want contactless payment. These days people don’t like to carry liquid cash; hence having these facilities in your restaurant is a must. Besides, you can save the printing and paper cost from the expense chart with a QR scanner.
Sometimes your restaurant sales depend on; how you promote and present your restaurant to your targeted customer. Hence; a marketing strategy can both make your restaurant popular overnight or can also degrade/ bring no profitable result for your restaurant.
Both the sales and profit your restaurant is going to make are totally unpredictable. Besides, it’s also hard to forecast or have assurance proof on how much profit your restaurant is able to make. It totally depends on the operation process and the cost budget you set to spend while running the restaurant business.
Besides, through primary sources, we gather some evidence from some restaurant owners that they are able to earn almost 35%-45%+ profit by doing restaurant business.
The best effective technological, managerial tool for your restaurant. Bhojon-restaurant management software offers you a complete machinery complete solution integrated with website and app facilities.
Nowadays, the latest generation demands digital solutions in exchange for every purchase. Therefore a managerial restaurant management software will handle, manage and organise your whole business and give them a dynamic business touch.
This management solution is so easy to use, you don't need coding knowledge to operate this software. In short a cost-effective and profit maximisation weapon for your business.
It's totally unpredictable to forecast and calculate how much a restaurant owner is gonna make, by doing restaurant business. Unlike any other business, a restaurant can also fail. If you can tactfully handle your restaurant business with a brilliant market and budget plan, you can easily catch a strong customer base with maximised profit.
Your revenue, profit, and sales all depend on how much effort, dedication, and how much you have understood your customer well and served them their desired meal.