While you may want an espresso machine imported from Italy, is the cost justified? Unless the answer is a resounding yes, consider pushing back non-essential expenses until you’re sure you can take them on without sacrificing liquidity. Our suggestion? Invest only in the essentials from the get-go: The seating, lighting, bar, kitchen service area first. Renovations can cost anywhere from $5,000 in paint, window treatments and flooring to $50,000 or more. Even a property that used to house a restaurant and is already set up for kitchen equipment, refrigeration, and running water may require extensive renovations to create an appropriate appearance. Renovation and decor costs vary greatly depending on your restaurant’s concept, your target market and the condition of the commercial space you inherit. Once you secure a space, it will likely need to undergo some renovations before it’s ready for the public. A space valued at $1 million, for example, would require a $150,000 to $350,000 down payment. If you’re buying a commercial space you should expect to pay a downpayment of between 15% and 35%. In this scenario, you’d need to have between $17,700 and $35,400 for a deposit. For a 2,000-square-foot space, this rate translates to $5,900 each month. The average rent for a restaurant space in downtown Los Angeles, for example, is $2.95 per square foot. So how much should you save for a deposit? Well, that depends on where you set up shop.

When you sign a commercial lease, you’ll need to commit to several years of occupancy at once and pay a refundable deposit-usually three to six months’ worth-to secure your spot. There are two ways to secure commercial space for a restaurant: leasing and buying.

While your startup costs will fluctuate depending on whether you decide to rent or own your retail space, renovation costs, which equipment you need and more, the things each restaurant needs to buy before opening their doors largely falls into these categories: A restaurant cost is any one-time expense for things like kitchen equipment, dishes or furniture. Before we jump into restaurant startup costs and expenses, it’s important to clarify the difference between the two.Ī restaurant expense is a recurring payment like rent, food costs, payroll, marketing and utilities.

Daily expenses spreadsheet