5 Really Important Matters To Think About In Pizza Business

Opening a pizza restaurant has been the top choice for most entrepreneurs and franchise groups have proven that this is profitable. Many years have come by but no other industry could beat the demand for such dish. With the combination of simple ingredients, anyone can create a pizza! 

Though it seems easy to open a pizzeria, it is also important that you keep in mind 5 things to consider before pursuing in it. 

1. It costs a lot. 
Opening a new restaurant means you have to be ready with your money for the start-up costs and it doesn't just mean having a penny or two. From purchasing an oven to a whole new renovation of the place, costs may rise up to the point that you may need investors as backers. Having backers also means having your first sales devoted to paying them back. 

2. Do you want to have the business as your own or do you want a partner? 
As mentioned above, having to spend a huge amount of money means either getting a backer or another option may be getting a loan. A business partner may be good to help you with the operations but sometimes it may also cause troubles from mistaken communications and failed expectations. Partners however, can't allow you to go bankrupt and could possibly be bought out in the future. Loaning money on the other hand allows you to have all profits to yourself but creates pressure in repayments.

3. Balance Sheet should be intact.
Equity = Assets + Liabilities. Are you still familiar with this equation? You should then because the assets are everything in sight, from the register, bank, accounts receivable, capital equipment, to inventory. While Liabilities are the ones you need to pay out, from payroll, lease, loans etc. Keep all these in mind and maintain a 1:1 ratio. This will probably ensure your company's growth. Can you handle this? 

4. Book keeping is essential. 
Aside from the equation above, all cost accounting and controls are systems that need to be intact as this would allow a smooth flow in operations and an easier time in loans or even when you sell the business. 

5. Liabilities and getting sued
It is the business that often get sued and it is certainly frightening to be in this position. Having a pizzeria have a lot of angles to get sued on, including delivery accidents, kitchen injuries, customer food poisoning etc. Lose the vulnerability and never allow the possibility to lose your personal assets by making your pizza shop a corporation instead of a sole proprietorship/partnership business. Legally, this will be a limited liability and protects you personally. 

Have you discerned these five thoughts? If you have, are you ready to build your pizza shop?
Posted by Diane Araga, on August 1, 2013 at 2:00 PM