The Quick Service Restaurant, more commonly known as the Fast-food Restaurant is a specific kind of restaurant format that serves fast food cuisines like Pizza, Burger and requires minimal table service. Major fast-food chains in India include KFC, Dominos, Starbucks & Pizza Hut. It is one the most lucrative restaurant formats among all and thus has also become the most popular choice of food business among the restaurateurs. The takeaway restaurant or QSR format seems to be the most practical format, as the return on investment is high. You can charge the price of a casual dining menu, but not incur cost the same as you save upon the area, furniture, air-conditioning, crockery, etc. However, you still need 100-150 orders to make it viable in the long run.
To be successful in QSR space, you need to come up with a unique idea and deliver a superior customer service in terms of food variety, quality, Delivery time & ambience.
Here we have shown the break-up of Rs 5 lakh, which we will explain in the points below.
Steps To Open A Quick Service Restaurant In India
Follow the below-mentioned steps that will help you open a fast-food restaurant in India.
- Choose the location of the quick-service restaurant
- Get all the licenses required to make your QSR legal
- Get on board the required number of staff
- Arrange for the kitchen equipment and the raw materials needed
- Market your QSR well
- Install a POS or a billing software To smoothen your operations
- Decide on the staff uniform
- Get all the other miscellaneous works done
Considering that you are going to start this dream project of yours, you might want to know the details or the step by step guide on how to open a fast-food restaurant in India. Don’t you worry! We will dive in deeper, to provide you with all the necessary information that will make your execution seem like a cakewalk.
1. Choosing The Location Of The Quick Service Restaurant
The location is one of the most critical factors which determine the success or failure of any restaurant. The takeaway restaurant should ideally be in a densely populated area, keeping the target audience in mind. Accessibility and visibility of the area are also essential to attract customers. Ground floor shops, located at the front are preferred for QSRs and Takeaways.
The store shop should be at least 450 sq ft in size to build a good kitchen. The counter and the serving area should not exceed 100 sq feet. Thus, for 450 sq feet, the rent should not exceed Rs 40-45k. So, out of the 5 lakh investment, Rs 1,20,000 goes to the landlord, who gets two-month rent, a one month rent in advance.
You also need to make sure that the building has a proper water supply and drainage facility. You must also obtain a No Objection Certificate (NOC) from the owner that he has no problem subletting his space for a food business, and also from the neighbors. The NOC is required in obtaining the Local Municipal License, and Food license.
2. Licenses Required For Opening A Quick Service Restaurant
A takeaway restaurant or a QSR primarily requires five licenses, namely: Food License from FSSAI, GST registration, Local Municipal Corporation Health License, Police Eating House license, and fire license. Out of all, Food license, GST registration, and Local Municipal Corporation Health License are the most important ones to have for starting of the outlet. Fire license and the likes can be acquired once you commence restaurant operations; however, it is recommended to have all the permits in place before opening the outlet to keep yourself away from the legalities and small hiccups that come due to unavailability of these licenses.
The three licenses have to be applied separately. For Food License, you can apply through its website www.fssai.gov.in. This can also be facilitated through various agencies that charge around Rs 5,000 for the complete paperwork and license fee. Any Charted Accountant can assist you with the GST registration. Lastly, for Municipal Corporation health license, you have to contact the local health inspector, and they will guide you through the process of acquiring the license. The license fee is nominal and will cost around Rs 3,000. Police Eating House and Fire license can be obtained once you have Municipal Corporation’s health license. This can be done in the first two-three months of the operations.
Here’s a list of all the licenses required for a restaurant business in India.
3. Staff Needed For Running A Quick Service Restaurant
The secret to a successful quick-service restaurant is often a great team behind the counter and in the kitchen. The Chef is probably the most important person on your team, as they not only cook, and design the menu; they also lead and guide the rest of the kitchen staff. The attrition rate is extremely high in the restaurant industry, especially at the junior level. Learn how to hire better for your restaurant here.
In a takeaway kitchen, a minimum of 5-6 employees is required in the kitchen. Out of them, two chefs are required who have a fair knowledge of every department of the kitchen. The salary of the chefs and helpers depends on their experience. The average salary of the chef at Commis level 1 is Rs 14000-Rs 15000 while the helpers and other staff salary range between Rs 6000- Rs 8000 based on their work. Apart from the kitchen employees, two delivery boys are required and one at the counter for taking the order. Find out how to create a Human Resource Structure for your restaurant here.
In today’s tech-time, there are a lot of third-party delivery services with whom you can tie-up for work on per order basis. They charge somewhere around Rs 30 for the first five km and Rs 10 for every extra km. It is highly recommended to have at least one delivery boy full time and part-time, even if you have partnered with a Third Party for deliveries, as a backup. These third parties will help you save the cost of the bike for delivery.
4. Kitchen Equipment And Raw Material Needed In A QSR
Kitchen equipment is a significant expense for the restaurants, and the same is the case in a fast-food or takeaway restaurant. A small working table for four sq ft can cost somewhere around Rs 6-7k. But, it is not always necessary to have everything new in the kitchen; most of the kitchen equipment can be bought old and used. It would roughly save around Rs 1 lakh. While working tables, refrigerator, store racks, and cupboards can be reused, burners, Tandoor, and gas pipelines should be new to avoid the added cost of repairs and gas leakages that are bound to happen. Other than the aforementioned kitchen equipment, Mixer, fry-pans, knives, cutting boards, and other utensils should be bought new.
About Rs 2,30,000 is invested in setting up the kitchen. Lastly, raw materials such as groceries, packaging, dairy, and poultry will cost you Rs 20,000 for the first five days of the operations, depending upon the sale you make in the first five days.
5. Marketing Of The Quick Service Restaurant
The tried and tested method of marketing and also one of the cheapest, is the pamphlets. You also need to spend some money on menu designing and logo designing, which should not cost more than Rs 2000. For the first two months, 30k pamphlets are good enough to market your restaurant. These 30k pamphlets of good paper quality will cost you somewhere around Rs 25,000. However, you can change the quality and quantity of the pamphlets as per your budget. Find out how distributing pamphlets and flyers can boost your restaurant sales.
Apart from pamphlets, invest some money in an excellent billboard to attract an audience. An average billboard costs around Rs 10,000. You can also spend on an online advertisement on Social Media and Google Adwords. You could also use your restaurant POS to market your restaurant well.
Read how you can do the right digital marketing for your QSR Restaurant.
6. POS And Billing Software Needed For The QSR
POS is the most critical and integral part of a successful operation and management of any restaurant or food outlet. Choose a niche POS that is customized to suit the requirements of a Quick Service Restaurant. Read a detailed guide on how to choose the perfect POS for your restaurant here.
The one we recommend is POSist, which is hardware-independent and entirely browser-based. You can use any web-enabled device such as a computer, laptop, tablet or even your mobile to generate the bills. The cost for this should not exceed more than 25000.
7. Staff Uniform For The QSR Employees
Staff uniforms are a critical aspect of a restaurant venture that is often ignored. All the staff members must look good, hygienic and well dressed. You can choose from different types of dresses such as chef coats, smart shirts and t-shirts, and an apron. At the initial stage of operations, it’s ideal to have a low-cost uniform which will save the additional cost. We recommend good t-shirts which will cost around Rs 150 per piece and if they ordered in bulk they would cost no more than Rs 120 per t-shirt. So, you can allocate an amount of Rs 6000-7000 for staff uniform which gives a nice feel to your restaurant brand.
8. Counter Design Of The QSR
It would be best to procure the raw materials and design your counter based on your need with the help of a carpenter. Go for a good standee and menu board at the front-end to give an overall feel of the brand. The counter and front-end will cost you somewhere around Rs 20-25k based on the design of the counter. This article will tell you how to do the branding for your restaurant.
9. Other Things Needed To Open A Fast-Food Restaurant
A Takeaway and Home Delivery outlet require one landline and at least two mobile phones. You can get a Cloud Telephony subscription that forwards the call to another designated number in case the first number is busy. You can also record the call for training purposes. It should not cost you more than 10k.
You further need to spend around Rs 8000 on electricity fitting and plumber work. Apart from that, you would require a good calculator, Fire-extinguisher, daily account books, attendance register, etc. Another idea would be to use your restaurant POS to have a call center panel to take your orders on call.
The quick-service restaurant industry in India is expanding on a massive scale. While the investments are low, when compared with the other formats, if you can start it well, it can help you the reap rewards. Hence, follow the steps mentioned as your go-to guide and implement them effectively, and watch how that dream quick-service restaurant of yours blossoms!