In today’s current economic climate, a business in the hospitality industry is one of the most promising opportunities Even with minimal capital and outlay, you can open something immediately, and, just as it is with opening a start-up business in any industry in today’s tenuous socioeconomic environment, starting a food and beverage-based business starts with small steps.
However, before you begin your venture, it is important to learn some tips on how to start a business in the hospitality industry with limited capital and investment. You also need to research, investigate, prepare, and take note of the following nine simple ways to start your hospitality endeavor with minimal outlay, and go from there, and navigate the marketplace before following your passion and opening your start-up.
The first important step to take towards starting a food and beverage business with small capital is to work out how your start-up will operate. Consider your concepts' uniqueness, value, and pricing, and refine your propositions concepts by addressing issues such as the design of your booth or food cart, your cooking equipment, and utensils, your display cabinet, its menu, its location, its targeted customer, and where the raw materials and ingredients will be sourced from and their storage et al.
These initial steps must include the following because to have a viable business you must conduct field surveys and observations to fully understand the targeted marketplace due to the competition in today’s highly competitive hospitality industrial complex.
As such, at this important juncture, you need to ask yourself some basic questions, such as:
What do you want to sell?;
Do you want to be on trend or create a trend?;
Do you want to offer traditional street food or rice dishes such as with pecel ayam (chicken salad), ayam geprek (smashed fried chicken), and bebek goreng (fried duck)?;
Do you want to offer cuisines from China, India, Japan, Korea,the Middle East, or Thailand?; or
Do you want to produce fast foods such as fried noodles, meatballs, satay, seafood, or soup?,
As well as these questions your business needs to refine your marketing concept and posit the following questions:
Will you start with online marketing through platforms like GoFood, GrabFood, or ShopeeFood?;
What will your promotions look like?;
Who will be the courier to deliver the orders to customers?; and,
If you're not opening a physical stall, how will delivery orders be managed?
Secondly, before starting your food and beverage business you need to do the following:
Do market research, conduct surveys, and gather as much information as possible about the current marketplace as well as your immediate competition so that you can fully identify and understand the opportunities available for your business concept.
Additionally, spruik the menu you plan to offer, and compare it and check it against your competitors' menu, so that you can adjust anything you have brainstormed accordingly to define and maintain your intended start-up opportunities and point-of-difference within the industry.
Thirdly, any business must have a detailed, well-thought-out business plan, especially a start-up venture in the hospitality industry, because the purpose of a business plan is to visualize its overall operational viability.
A business plan is a simulation of how to start your start-up concept, its cash flow, development strategies, marketing campaigns, and sales projections. Furthermore, in case you need (or choose) to have a business partner and/ or investor, having a clear and concise business plan allows you to be able to present your ideas in plain and simple terms.
A clear, considered, and well-thought-out Business Plan should include the following:
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Fourthly, you must choose the right, strategic location for your start-up whether or not you are starting with small or large capital.
Finding, and selecting the right, strategic location requires intensive field surveys and observations as commented on in Highlight 2: Survey, Research, and Gather as Much Information as you can about Market Opportunities.
You must observe the proposed area during the breakfast, lunch, and dinner rush, as well as the times between the peak hours of business.
Additionally, it is just as important to observe the surroundings, pay attention to the foot traffic, what kind of people pass by, what are their assumed professions, what is the viability of them becoming a potential customer, a regular, and how many people there are out and about in the neighborhood during these time parameters.
Moreover, it is equally as important to observe the location's parking availability, safety, and security, and ask the locals if the area is flood-free, or prone to industrial noise or pollution.
It is also important that you do NOT randomly choose a location when starting a food business, because you must consider the purchasing power of the community around your chosen location, as the neighborhood reflects the local population, what products are affordable and available to them, and who their potential, regular customers could be.
Alternatively, are you making your business a unicorn, a destination restaurant, and hospitality statement immaterial of its location?
Fifthly, when starting a business it is important to create a business brand and name that stands out because it helps your potential clientele recognize your business, whether they see it in passing, or by generic Google search for new restaurants in x, or using Google Maps, per se. Furthermore, your creativity can be extended when selecting a name or brand for your business, however, ensure that your branding and naming selection aligns with the products and services that you offer as there is the potential for a disconnect and confusion if you get too clever with your selection.
For example, if your business name consists of two words, ensure that at least one of the words is a keyword related to the type of menu that you are selling, while the other name can be one that you have created as a point-of-difference, a hook to both entice and intrigue customers. In addition to branding and naming your menu should be creative and innovative so as to capture your customers’ attention.
Because your start-up is an industry newcomer, your products and services must stand out, not only with its brand and name but also in their price-point and menu. Moreover, having a new business in the hospitality industry is not just about having a creative, and unique brand and name; it is equally as important to have a catchy name, and a place that your customer wants to go to - for the ambiance, the experience, the menu, the pricing, the taste, the people, and for the sense of belonging.
To make a point-of-difference, Fintech Youtap has developed an e-menu feature connected to an Order from Your Phone (PHP) service which provides a convenient and practical way for customers to place orders and make payments using the e-menu feature.
Furthermore, Youtaps’ E-menu is directly integrated with its Youtaps Business Tablet and Youtap Business Portal, and by partnering with them your business can also access and use its PHP service for E-menu options such as dine-in and takeaway, pick-up, and delivery.
Sixthly, after creating your businesses brand, name, and menu, as highlighted in Point 5: Create a Business Name and Menu, introduce your start-ups brand, name, and menu through social media platforms such as Facebook (Meta), Instagram, TikTok, and Twitter (X), because these platforms are the most efficient and effective ways for you to start your hospitality business with limited capital and investment, as well as creating accounts and fan pages with your business name.
Furthermore, ensure that you create an easy-to-remember, identifiable, stand-out logo that captures the attention of potential customers, both as passersby and internet trawlers.
From this, create daily promotional content, from blogs and vlogs to photos and videos, that showcase your start-ups products and services, and within this consider displaying your price-points to create a point-of-difference and reference - whether your business is a stand out contender in Cheap Eats, or is lumped together and lost within the crowded hospitality marketplace.
Regardless, post and share your promotional material via Telegram, WhatsApp, and any other medium you can think of to cheaply and easily promote your products and services.
Additionally, consider partnering with food and beverage-centric apps such as GoFood, GrabFood, and ShopeeFood to further increase your businesses visibility and viability.
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Seventhly, just like any business or start-up, success in the hospitality industry comes with the help of having a strong team.
As such, to maintain your business’s strength, and your personal peace of mind, you must have at least one committed, hard-working, and reliable assistant to help with the day-to-day running of your business. Alternatively, having more than one assistant is another option when starting a business in hospitality, as they can share the load, helping your start-up run smoothly and grow quickly.
However, as it is in any business enterprise, there must be a clear division of tasks between preparation and cooking to processing orders and managing customers, to creating promotional content and handling accounts and bookkeeping et al.
Eighthly, the amount of capital required to start your start-up hospitality business can vary, depending on the kind of business you want to its location, your menu to your staff et al.
However, there are some suggested pricing guidelines at the cost of launching a food and beverage start-up:
Finally, while running a food business with limited capital, it is important to think about ways that you may have to be able to expand your business.
Your goal must be in your start-up's sales and because selling (more) products attracts more customers, creating a buzz, a vibe about your business’s products and services.
As such, business development can be achieved by following the highlighted points:
This article has expanded on nine suggestions for a hospitality business with small capital investment.
To help you further your endeavor, FinTech Youtap’s Business application ensures that your start-up business runs smoothly, with its POS application making payments easier with QRIS, automatically recording transactions, as well as analyzing sales data in real-time to help you to determine your businesses next marketing campaign and sales strategy.
So use Youtap’s Business application by simply downloading Youtap’s App directly from the Google PlayStore or the AppStore. You won’t regret it.
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