You Need To Start a Restaurant In Canada In Just 10 Moves?
To start a restaurant in Canada is not as complicated as people think it is, however, there are some factors to be taken care of. While there are many things you need to consider, such as logistics and permits, the basic steps are finding the right location, setting up your legal structure, getting financing, being compliant, and then marketing.
I won’t say these 10 moves are easy but definitely helpful for you to start a restaurant in Canada. Be it the city of Toronto, Montreal, Ottawa, Quebec, Calgary, Edmonton, or even any local region or suburb of Canada.
This is how you can start a Restaurant in Canada:
1. Find a suitable location.
You’ve got the idea and are ready to start your business, but where? The first thing you need to do is find a location.
You’ll want to pick a spot accessible by foot, bike, or public transportation. It should also be near other businesses that have similar clientele.
For example, if your restaurant is going to serve meat dishes, it would be wise not to locate in an area with lots of vegan restaurants nearby
—this could attract customers who aren’t interested in eating meat at all (or maybe even turn them off).
Similarly, if you’re planning on opening up a dessert bar specializing in ice cream sundaes with hot fudge sauce drizzled over everything AND sprinkles on top, then it might not be wise to set up shop next door to a fast-food chain or McDonald’s;
-they don’t fit into the same market niche as what you’re offering.
2. Set a budget for your restaurant.
Now that you have a general idea of how much it will cost to start a restaurant in Canada, it’s time to set a budget for yourself.
A good rule of thumb for setting your budget is to ensure that your monthly expenses are less than $20,000 per month.
- This includes rent, equipment, permits, and other fees for starting up the business; inventory (food) purchases;
- Staff salaries; marketing costs; utilities such as lights and water delivery services;
- Insurance costs including liability coverage for accidents on site plus general property damage protection from theft or fire damage during construction phases when no customers are present);
- Supplies used regularly like cleaning or soap purchased by janitors etc.; waste disposal services if applicable.
Finally, accounting fees will be charged by accountants specializing in small businesses because they know exactly what needs to be done when opening up a shop, so there won’t be any surprises down the road, either financially or legally speaking.
3. Develop a business plan for your restaurant.
Develop a business plan for your restaurant. A good business plan will include:
- Business name, address, and contact information
- Business concept and concept summary
- Market analysis
- Marketing plan
- Operations plan with equipment specifications and layout drawings, if available or can be produced by a design firm or building contractor, including floor plans and elevations of the building as well as exterior photos.
Include any features that will distinguish your restaurant from others in the same market area (such as “antique” decor) or any unique features (e.g., patio).
You must also include details about kitchen equipment that provides refrigeration units, ovens/stoves (gas vs. electric), dishwashers, etc.
4. Apply for licenses and permits to start your restaurant in Canada.
Before starting your restaurant in Canada and opening its doors, you’ll need to apply for the proper licenses and permits.
Licenses and permits are issued by the province or territory where your restaurant will be located and are required by law.
Before getting started, it’s essential to understand what each license does:
- Liquor Licence – This allows you to sell alcohol on site (i.e., drinks at a bar). You may also be able to entertain, such as live music or dancing on-site if it is part of your liquor license application.
A liquor license will cost between $1,000–$10,000, depending on the type of business applying for one.
Food Safety Certificate – Failing to have a valid Food Safety Certificate can result in hefty fines from Health Canada;
so make sure yours is up-to-date before opening day. The fee varies from province to province but expects to be something like $50-$100 per inspection.
Employment/Labour Market Impact Assessment (LMIA) – An LMIA is needed if any foreign workers will fill more than 10% of your total workforce;
5. Incorporate your business.
- Incorporate your business.
- Get a lawyer to set up the corporation and all its associated paperwork. You can incorporate yourself or have a lawyer do it for you, but either way, this is something that needs to happen before opening your doors.
There are two types of corporations in Canada: private companies and non-profits.
6. Get approvals from local authorities to open your restaurant.
You need to know that every municipality has different rules and regulations for starting a restaurant.
Before applying, you must contact your local authorities to find out about the necessary permits, licenses, inspections, and taxes.
- Business license: You need to get a business license from your local government if you plan to start a restaurant in Canada (even if it’s just selling food on your property).
- Health permit: A health permit must be obtained by all businesses selling prepared food like hotdogs or sandwiches because they are considered high-risk foods which may contain bacteria if you aren’t aware of so.
7. Work with a tax advisor.
To ensure you comply with all the local, provincial, and federal regulations for collecting sales tax and paying income tax, including GST/HST if it applies.
The Canadian federal government requires all businesses to charge, collect and remit GST/HST on the goods and services they sell.
Businesses that have a taxable presence in Canada must report their business income and expenses on their annual corporate tax return.
Businesses can file their returns electronically through NETFILE or mail them on paper.
The Canada Revenue Agency does not accept electronic payment methods for GST/HST or other taxes, so you’ll need to make sure you have enough cash flow to pay the money you owe when it’s due.
8. Apply for financing.
Financing is a crucial step in opening your restaurant. It’s essential to find the right lender, and this will depend on the type of business you plan on starting.
If you are an experienced restaurateur with a solid track record and collateral, you may be able to qualify for a traditional loan from a bank or credit union.
9. Prepare a marketing plan and build a website to get customers and keep them coming back.
Your marketing plan should include:
- You can use a website to get customers and keep them coming back.
- Social media accounts so people can find you and interact with your brand on their preferred platforms.
- Public relations, such as news releases, speaking engagements, and other efforts, will expand your reach beyond the internet.
You’ll also want to focus on search engine optimization (SEO), which is a fancy way of saying that you’ll make sure Google knows exactly what kind of restaurant you are when people type in keywords related to restaurants or food.
A few things this includes are optimizing your website for search engines, creating an online presence on local business directories, and making sure your SEO strategy is part of every aspect of running a restaurant
—from hiring staff members who embrace it through content marketing campaigns targeted at potential customers in specific geographic areas where the restaurant operates.”
10. The basic steps
Are finding the right location, setting up your legal structure, getting financing, being compliant, and then marketing.
Getting started is a lot of work, but the basic steps are finding the right location, setting up your legal structure, and obtaining financing.
You also need to be compliant with applicable laws and regulations. Finally, you should market yourself so that customers know about your business.
Setting up a restaurant in Canada is not for everyone – some challenges come with operating in this industry.
If you have some experience in restaurants or hospitality, then it might be worth considering these steps as part of starting your business venture.
There are a lot of steps in starting a restaurant, but it can also be a rewarding endeavor.
You will need to do your research and plan carefully, but if you follow these tips, you’ll be on your way.