partnership restaurant business plan

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5 steps to successful restaurant partnerships 5 steps to successful restaurant partnerships

• See more Management Tips

December 3, 2014

In the restaurant industry, it’s very common to venture into business with family or friends. In fact, some of the most well-known restaurants, including Red Lobster and Buffalo Wild Wings, started out as partnership ventures before being sold or turned into restaurant corporations. Under the right circumstances, joining forces with a partner can be a successful way to buy and operate your dream restaurant. 

However, opening a restaurant with a partner is not as simple as just combining together your favorite family recipes. Partners must agree on a variety of issues from their respective roles in operations to their stakes in ownership if they want their restaurant to have a chance at success. Jumping ahead without clarifying these issues jeopardizes the success of your restaurant operation and can turn your partner relationship into a toxic one down the road.

By following the five steps below, you’ll not only ensure a smooth partner working relationship, but also the financial success of your restaurant venture. 

1. Select the right partner(s). 

The single most important component of the partnership process is partner selection. Although it is very common to open a restaurant with relatives or close friends, keep in mind that these relationships do not always guarantee a smooth or strong partnership. Look beyond your personal relationships and evaluate potential partners on their skill sets and resources. Do they have the knowledge needed to run the restaurant? Do they bring different skills, expertise and perspectives to the business? Are they dependable? What additional resources, either financial or personal connections, can they bring to the business? All of these are important to consider when selecting a partner. Don’t let personal biases cloud your judgment.  

2. Agree on your business goals.

After you find a potential partner, sit down and discuss exactly what type of restaurant you would like to purchase, if you haven’t already, and what goals you have for the restaurant. Think about whether you would prefer to operate the restaurant for the long term, or if you would rather grow the business and then try and resell it as quickly as possible. Make sure you agree on growth plans (single location, multiple locations, growth by franchising, etc.). It’s critical you and your partner share the same ownership goals, or you risk having major clashes later on. 

3. Outline ownership stakes.

Partners also need to agree on their ownership stakes, financial commitments and voting stakes. It’s common for partners to join forces out of financial need. For example, sometimes one person has the skills and ambition to operate the restaurant, and the other partner has the financial resources needed to purchase the restaurant. In cases where the partners are not making equal financial contributions, or one buyer is a “silent partner,” it is especially critical to agree on these ownership issues up front.

4. Clarify partner roles.

If both partners plan on being active in operations, it is important to define the areas of business and decision making for which each partner will be responsible. Ideally, partners should bring complementary skills to the restaurant. For example, perhaps one partner is better at overseeing the staff, and the other is better at running the kitchen. Having separate responsibilities with minimal overlap prevents inefficiencies and arguments over how things should be done. Still, it is wise to create a set of procedures for resolving the inevitable differences that will arise between you and your partner. 

5. Get a partnership agreement in writing.

Remember that your relationship with your partner, like any relationship, will change over time. Therefore, it’s imperative that you create a solid partnership agreement before jumping into business. Your broker and attorney can help draft an agreement that outlines financial contributions, ownership stakes, roles and decision-making, an exit plan and other potential issues upfront. Having this in writing gives you something to reference when disputes come up. Just remember to have the agreement updated if anything changes down the line. For example, agreeing on a fair valuation process before going into business will help ensure a smoother sale or partner buyout, but that valuation number also needs to be consistently updated to reflect the restaurant’s current value.

Don’t let the excitement of your new restaurant venture keep you from considering all the above issues. Remember, you can never be certain that you and your partner are on the same page without having an open, direct conversation. So, set the table for success by taking the time to reach an agreement on the above issues, and put that agreement in writing so that it is not remembered differently down the road

Bob House is group general manager for BizBuySell.com  and BizQuest.com , the Internet's largest and most heavily trafficked business-for-sale marketplaces.

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the Restaurateur

6 Key Steps to a Successful Restaurant Partnership

Looking to partner with a relative or friend to furnish your dream for a new restaurant? There are a number of preemptive measures to ensure success for both partners.

It is quite common for family members and friends to venture into the restaurant business together. Buying and operating a restaurant can, in many instances, be much more successful if you’re involved in a partnership venture. Joining forces does have its difficulties, though, and it is important for both partners to agree on a variety of issues that come along with owning and operating a restaurant before jumping into a partnership.

What do successful partnerships depend on?

There are a few things you need to do right at the beginning of the partnership to ensure restaurant success. It is crucial to:

• Make sure that you select the right partner. Partner selection is the single most crucial component of joining forces with someone else. Even if you are partnering with a close friend or relative, you will want to be sure that he/she has the skills and resources to be a good business partner. It is crucial that you look beyond your personal relationships and judge a potential partner by his/her dependability, expertise, and skillset.
• Come to an agreement on the restaurant’s goals. Decide with your partner what type of restaurant you’re interested in purchasing and what long and short term goals you have for the business. Are you looking to resell in a few years or keep it for the long term? You will inevitably run into issues if you and your partner’s goals are not aligned, or if one of you has growth or franchising plans that he/she has not communicated to the other.
• Make sure you have outlined each partner’s role. For smooth business, make sure that each partner has a defined role and there isn’t confusion or overlap. It is best to work off the skills of each individual partner. One partner might be better at managing the kitchen, while one is more cut out for managing the staff, for example.
• Agree on ownership stakes. Ownership stakes, voting stakes, and financial commitments are things you and your partner need to agree on upfront. Partnering with others is common if you have the skills and desire to start the business, yet lack the financial resources necessary in the purchase process. It is imperative that you agree on these issues up front especially in instances where the partners are not contributing equally to the finances, or if one partner is a “silent partner”- meaning his/her only role in the partnership is providing capital to the business.
• Draft a written partnership agreement. Your attorney or broker should assist you in drafting a written partnership agreement that provides details on ownership stakes, decision making roles, financial contributions, exit plans, and any other issues you might foresee. It is crucial to have everything in writing to prevent any issues down the line. With the agreement in writing, there is no way that one partner can remember a stipulation of the agreement differently and make an issue out of it.
• Have regular meetings with your partner. Be sure to communicate regularly about how the goals of the restaurant are playing out and how the divisions of responsibilities are working out for you and your partner. It is far better to discuss issues early, before they get to a point where they damage your partnership, working relationship, or personal relationship. The importance of communication cannot be stressed enough!

If you follow these steps and keep up the regular conversations with your partner, your partnership will have a strong foundation for future growth and success.

Questions? Contact any member of our Hospitality Services Group .

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Restaurant Business Plan Template & PDF Example

• September 4, 2024
• Food & Beverage

Creating a comprehensive business plan is crucial for launching and running a successful restaurant. This plan serves as your roadmap, detailing your vision, operational strategies, and financial plan. It helps establish your restaurant’s identity, navigate the competitive market, and secure funding for growth.

This article not only breaks down the critical components of a restaurant business plan, but also provides an example of a business plan to help you craft your own.

Whether you’re an experienced entrepreneur or new to the food and beverage industry, this guide, complete with a business plan example, lays the groundwork for turning your restaurant concept into reality. Let’s dive in!

Our restaurant business plan is structured to cover all essential aspects needed for a comprehensive strategy. It outlines the restaurant’s operations, marketing strategy, market environment, competitors, management team, and financial forecasts.

• Executive Summary : Offers an overview of the restaurant’s business concept, market analysis , management, and financial strategy.
• Restaurant & Location: Describes the restaurant’s prime location, size, seating capacity, and distinctive design, emphasizing its appeal to the target demographic.
• Supply & Operations: Outlines the supply chain management, focusing on local sourcing and quality ingredients, and details the operational aspects, including kitchen layout, equipment, and front-of-house operations.
• Key Stats: Shares industry size , growth trends, and relevant statistics for the full-service restaurant market.
• Key Trends: Highlights recent trends affecting the restaurant sector, such as health-conscious dining, sustainability, and technology integration.
• Key Competitors: Analyzes the main competitors in the vicinity, showcasing the restaurant’s unique selling proposition in comparison.
• SWOT : Strengths, weaknesses, opportunities, and threats analysis.
• Marketing Plan : Strategies for promoting the restaurant to maximize visibility and customer engagement.
• Timeline : Key milestones and objectives from the initial setup through the launch and operational optimization.
• Management: Information on who manages the restaurant and their roles.
• Financial Plan: Projects the restaurant’s financial performance, including revenue, profits, and expected expenses, aiming for profitability and sustainable growth.

Restaurant Business Plan Template (Download)

Fully editable 30+ slides Powerpoint presentation business plan template.

Download an expert-built 30+ slides Powerpoint business plan template

Executive Summary

The Executive Summary introduces your restaurant’s business plan, offering a concise overview of your establishment and its offerings. It should detail your market positioning, the variety of cuisines and dining experiences you offer, its location, size, and an outline of day-to-day operations. 

This section should also explore how your restaurant will integrate into the local market, including the number of direct competitors within the area, identifying who they are, along with your restaurant’s unique selling points that differentiate it from these competitors. 

Furthermore, you should include information about the management and co-founding team, detailing their roles and contributions to the restaurant’s success. Additionally, a summary of your financial projections, including revenue and profits over the next five years, should be presented here to provide a clear picture of your restaurant’s financial plan.

Restaurant Business Plan Executive Summary Example

Business Overview

The  business overview  should detail the restaurant’s specific features, such as its seating capacity, ambiance, and supply chain practices. It’s important to emphasize how the restaurant caters to its target demographic through its strategic location and operational model.

Example: “[Your Restaurant Name],” located in [specific area or neighborhood], covers [total square footage] sq ft and includes a main dining area, bar, and outdoor patio, offering a total of [number of seats] seats. The restaurant’s commitment to quality is reflected in its locally sourced produce and sustainable supply chain practices, catering to a diverse clientele.

Market Overview

This section involves analyzing the size, growth, and trends of the full-service restaurant market. It should address the industry’s digital transformation, health-conscious dining preferences, and eco-friendly practices, positioning the restaurant within the broader market context.

Example: “[Your Restaurant Name]” enters a U.S. full-service restaurant market valued at $293 billion. The restaurant’s focus on technology, healthier menu options, and sustainability aligns well with current  market trends  and consumer preferences, setting it apart from six main competitors in the area.

Management Team

Detailing the management team’s background and expertise is crucial. This section should highlight how their experience in culinary arts and restaurant management contributes to the success of the restaurant.

Example: The Executive Chef and Co-Owner of “[Your Restaurant Name]” leads menu development and kitchen operations, ensuring high-quality food preparation and presentation. The General Manager and Co-Owner manages daily operations, staff, customer service, and financial aspects, ensuring a seamless dining experience.

Financial Plan

This section should outline the restaurant’s financial goals and projections, including revenue targets and profit margins, providing a clear picture of its financial aspirations and health.

Example: “[Your Restaurant Name]” aims to achieve $2.7 million in annual revenue with an 11%  EBITDA  margin by 2028. This financial goal is supported by a focus on quality dining experiences, strategic marketing, and operational efficiency, positioning the restaurant for growth in the  competitive  full-service restaurant market.

For a Restaurant, the Business Overview section can be concisely divided into 2 main slides:

Restaurant & Location

Briefly describe the restaurant’s physical environment, emphasizing its design, ambiance, and the overall dining experience it offers to guests. Mention the restaurant’s location, highlighting its accessibility and the convenience it offers to diners, such as proximity to entertainment venues or ease of parking. Explain why this location is advantageous in attracting your target clientele.

Supply & Operations

Detail the range of cuisines and dishes offered, from appetizers and main courses to desserts and specialty beverages. Outline your sourcing strategy, ensuring it reflects a commitment to quality and sustainability, and matches the market you’re targeting.

Highlight any unique culinary techniques, exclusive ingredients, or innovative kitchen technologies that set your restaurant apart. Discuss your operational strategies, including inventory management, supplier relationships, and kitchen workflow, to ensure efficiency and consistency in delivering exceptional dining experiences.

Industry size & growth

In the Market Overview of your restaurant business plan, start by examining the size of the restaurant industry and its growth potential. This analysis is crucial for understanding the market’s scope and identifying expansion opportunities.

Key market trends

Proceed to discuss recent market trends , such as the increasing consumer interest in farm-to-table dining, ethnic cuisines, and experiential dining experiences.

For example, highlight the demand for restaurants that offer unique cultural dishes, the growing popularity of health-conscious and dietary-specific menus, and the integration of technology in enhancing the dining experience.

Competitive Landscape

A  competitive analysis  is not just a tool for gauging the position of your restaurant in the market and its key competitors; it’s also a fundamental component of your business plan.

This analysis helps in identifying your restaurant’s unique selling points, essential for differentiating your business in a  competitive  market.

In addition, competitive analysis is integral in laying a solid foundation for your business plan. By examining various operational aspects of your competitors, you gain valuable information that ensures your business plan is robust, informed, and tailored to succeed in the current market environment.

Identifying Competitors in the Restaurant Industry

To comprehensively understand the competitive landscape, start by identifying both direct and indirect competitors in your area. Direct competitors are restaurants offering similar cuisines or targeting a comparable customer base. For instance, if your restaurant specializes in authentic Mexican cuisine, other nearby Mexican restaurants are direct competitors. Indirect competitors may include food trucks, cafes, or even fast-casual eateries offering diverse menus that overlap with your offerings.

Leverage digital tools like Google Maps, Yelp, or food delivery apps to map out the locations of your competitors. Reviews and ratings on platforms like TripAdvisor and social media can offer valuable insights into competitors’  strengths and weaknesses . Positive reviews highlighting exceptional service or a unique dining experience at a competitor’s restaurant can signify an area of focus for differentiation and improvement.

Restaurant Competitors’ Strategies

To conduct a comprehensive analysis, delve into various aspects of your competitors’ operations:

• Menu Offerings:  Assess the breadth and uniqueness of dishes offered by competitors. Take note if any local restaurants are gaining traction by focusing on farm-to-table ingredients, regional specialties, or offering innovative fusion cuisines, as these aspects often indicate emerging  market trends .
• Service and Ambiance:  Evaluate the overall customer experience. Identify if there’s a competitor renowned for its fine dining experience, another known for its trendy and vibrant atmosphere, or one that excels in providing a casual, family-friendly environment. These elements significantly contribute to a restaurant’s success and differentiation.
• Pricing and Positioning:  Compare pricing strategies . Determine whether competitors are positioned as budget-friendly eateries or if they adopt a more upscale approach with premium pricing, highlighting gourmet ingredients, or exclusive dining experiences.
• Marketing Channels :  Analyze how competitors market their restaurants. Do they leverage social media platforms for promotions, engage in collaborations with local influencers, or host special events or themed nights? Understanding their marketing tactics provides insights into effective promotional strategies that resonate with the  target audience .
• Operational Efficiency:  Observe if competitors have adopted technological advancements such as online reservations, mobile apps for ordering, or contactless payment systems. These innovations not only streamline operations but also contribute to an enhanced customer experience.

What’s Your Restaurant’s Value Proposition?

Reflect on what uniquely distinguishes your restaurant from the competition. It could be your innovative fusion of cuisines, a strong emphasis on locally sourced and sustainable ingredients, or perhaps a distinctive ambiance that reflects a particular cultural theme or historical narrative.

Listen attentively to customer feedback and observe emerging industry trends to identify gaps or unmet demands in the market. For instance, if there’s a growing interest in plant-based dining experiences and competitors have not tapped into this niche, it could present an opportunity for your restaurant to cater to this demand and stand out.

Consider how your restaurant’s location influences your strategy. A downtown location might warrant a focus on quick service and catering to office lunch crowds, while a suburban setting could embrace a more relaxed, family-friendly dining environment.

First, conduct a SWOT analysis for the restaurant , highlighting Strengths (such as a unique menu and exceptional customer service), Weaknesses (including potential high operational costs or strong competition in the area), Opportunities (for example, a growing interest in diverse cuisines and healthy eating), and Threats (such as economic downturns that may decrease consumer spending on dining out).

Marketing Plan

Next, develop a marketing strategy that outlines how to attract and retain customers through targeted advertising, promotional discounts, an engaging social media presence, food blogger outreach, and community involvement, such as local events or charity sponsorships.

Marketing Channels

Utilize various marketing channels to engage with your audience and attract new patrons.

Digital Marketing

• Social Media:  Utilize social media platforms such as Instagram, Facebook, Twitter, and TikTok to showcase your restaurant’s ambiance, signature dishes, behind-the-scenes glimpses, chef profiles, and customer testimonials. Regularly engage with your audience by responding to comments, hosting interactive polls, or sharing user-generated content.
• Email Marketing:  I mplement an email marketing strategy to build a loyal customer base. Offer incentives such as exclusive recipes, promotional offers, or early access to special events in exchange for subscribing to your newsletter. Regularly communicate with your subscribers, sharing updates, promotions, and stories that resonate with your brand.
• Website and SEO:  Maintain an  informative website showcasing your menu , chef profiles, reservation options, and reviews. Optimize it for local SEO to ensure visibility in searches related to your cuisine and location.

Local Advertising

• Printed Materials:  Distribute well-designed flyers in nearby neighborhoods, advertise in local magazines, and collaborate with tourism centers or hotels for exposure.
• Community Engagement:  Sponsor local events, collaborate with food bloggers or influencers, and participate in food festivals or charity events to increase brand visibility and community involvement.
• Partnerships:  Forge partnerships with complementary businesses (such as wine shops or local farmers’ markets) for cross-promotions or collaborative events.

Promotional Activities

Engage potential customers through enticing offers and events.

• Special Offers:  Launch promotions like ‘Chef’s Tasting Menu Nights’ or ‘Happy Hour Discounts’ to attract new diners and retain regulars.
• Loyalty Programs:  Implement a loyalty system offering rewards for frequent visits or referrals, such as a free appetizer or dessert after a certain number of visits.
• Events and Special Occasions:  Host themed nights, seasonal menus, or exclusive culinary events to create buzz and attract diverse audiences.

Sales Channels

Efficiently manage  sales channels  to maximize revenue and customer satisfaction.

In-Restaurant Upselling

• Menu Strategies:  Highlight premium dishes or chef’s specials, offer wine pairings or dessert suggestions, and train staff to upsell without being pushy.
• Merchandising:  Display branded merchandise, specialty sauces, or cookbooks for sale to complement the dining experience.

Online Ordering and Delivery

• Online Ordering Platform: I mplement an easy-to-use online ordering system for takeout or delivery orders. Offer exclusive online discounts or bundle deals.
• Delivery Partnerships:  Collaborate with food delivery services or establish in-house delivery for customers’ convenience.

Reservation Management

• Reservation System:  Utilize an efficient reservation platform to manage bookings. Offer incentives for off-peak reservations or special occasions.

Membership and VIP Programs

Developing membership and VIP programs can cultivate a loyal customer base and drive recurring revenue:

• VIP Memberships:  Create exclusive membership tiers offering perks like priority reservations, chef’s table access, or private event invitations.
• Reward Programs:  Develop a digital loyalty system where customers earn points for every dollar spent, redeemable for discounts, exclusive menu items, or special events.

Strategy Timeline

Finally, create a detailed timeline that outlines critical milestones for the restaurant’s opening, marketing campaigns, customer base growth, and expansion objectives, ensuring the business moves forward with clear direction and purpose.

The management section focuses on the restaurant’s management and their direct roles in daily operations and strategic direction. This part is crucial for understanding who is responsible for making key decisions and driving the restaurant towards its financial and operational goals.

For your restaurant business plan, list the core team members, their specific responsibilities, and how their expertise supports the business.

The Financial Plan section is a comprehensive analysis of your financial projections for revenue, expenses, and profitability. It lays out your restaurant’s approach to securing funding, managing cash flow, and achieving breakeven.

This section typically includes detailed forecasts for the first 5 years of operation, highlighting expected revenue, operating costs and capital expenditures.

For your restaurant business plan, provide a snapshot of your financial statement (profit and loss, balance sheet, cash flow statement), as well as your key assumptions (e.g. number of customers and prices, expenses, etc.).

Make sure to cover here _ Profit and Loss _ Cash Flow Statement _ Balance Sheet _ Use of Funds

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Should You Have a Business Partner? Why & Why Not

Opening a restaurant with a partner? Check out the benefits and risks of co-ownership, and how to ensure your partnership works out.

Dahlia Snaiderman Author

Dahlia Snaiderman

Dahlia Snaiderman is a former prep cook turned writer, editor, and content marketer.

The first restaurant I worked at had five owners: One was the executive chef, and the other four were general managers. Finding even one business partner you click with can be a challenge, let alone four of them. And while this is just one case, it was the best-run restaurant I've ever worked in. Front- and back-of-house staff of all levels stayed on for decades. This restaurant had other things going for it, but I attribute much of its lasting success to the teamwork mentality that extended all the way up to the highest ranks in the business. All four GMs had a better work-life balance than most in the industry, leaving them time to spend some weekends with their families and friends and keeping them refreshed and engaged in the business. 

These owners’ success doesn’t mean you should rush out and find a business partner (or four), but it’s worth exploring the benefits, risks, and best practices of business partnerships in the restaurant world. We've also thrown in definitions of the five most common types of restaurant partnerships.

Benefits of Restaurant Business Partner

• Division of labor
• Financial support
• Camaraderie like you’ve never known it before
• Accountability to make it happen
• An ideas sounding board
• Diversity of skills

The Upsides: Why You Should Have a Restaurant Business Partner

Division of labor. Having another person to divide the workload of opening a restaurant and keeping it running can be a game-changer. There will be times when one of you is sick or burnt out and the other picks up the slack. A good partnership will have the give-and-take that makes for healthier, happier business owners.

Financial support. Having a business partner removes some of the financial burden of opening a restaurant. You may be coming to the project with different financial backgrounds, but you won’t be dealing with loans or banks alone. You’ll also be starting with two pools of money where there would otherwise only be one.

Camaraderie like you’ve never known it before.  You’ll have a partner to share the ups and downs of restaurant ownership, and there will be many moments that you’ll wonder how you could possibly do any of it without them. The business can succeed or fail, but either way, you’ll be in it together.

Accountability to make it happen.  As business coach Melyssa Griffin says , a business partner can push you to actually do the thing, to put in the work to make your dream of restaurant ownership a reality. It’s easy to daydream about quitting your job and opening a restaurant , but if you’ve made that plan with another person, you’re more likely to make the leap.

An ideas sounding board.  A business partner can help you dig up your best ideas, or tell you when one should be worked on a little more. “We find that our two brains help with creativity,” says Tom Amsden, co-owner of The Den in Grantsburg, WI.  

Diversity of skills. A business partner worth having is one who can tackle things that aren’t your forte. More on this below.

The Downsides: Compromise, Risk, and Division of Profit

Compromise. There will be no “my restaurant” — It’s going to be “our restaurant.” This means any idea you have, be it related to menu, design, staffing, or finances, will have to be agreed upon by both of you. Compromise will be a big part of your business model; the partnership will fail without it. If you’re both headstrong and unwavering, the whole process will be difficult.

Risk of losing the relationship. There’s a reason they say never to go into business with family and friends. Opening a restaurant together can be one of the biggest tests of a relationship. You will likely butt heads at some point and then make up, but there’s always the chance that getting money (and property, and bureaucracy, and life ambitions) mixed up in your relationship will lead to the fraying of your ties. People have fallen out over less.

Division of profits. In the absolute best-case scenario, your restaurant thrives and you have customers lining up around the block. Your food cost is good, your inventory isn’t spoiling, your equipment is in good shape, and your staff feel appreciated , so they stick around. This means that maybe — just maybe — you’re actually looking at profit (in this famously narrow-margin business ). If you have a business partner, that profit is being split in two (or more), no way around it.

How to Set up a Stable, Worthwhile Business Partnership

Now that you know the pros and cons of going into the restaurant business with a partner, you should consider these business partnership best practices well before looking for real estate or dreaming up a menu.

Contracts, contracts, contracts.

Draw up an ownership agreement. It’s the best way to prevent problems before they start, explains accounting firm Kahn Litwin. If you don’t know how, it’s worth getting in touch with a lawyer who can help you. It’s better to hire one now, briefly, to prevent problems, than to hire one later to try and solve them. Why draw up a contract with your brother/cousin/friend? There’s a lot of bureaucracy and red tape ahead of you. You’ve got a lease — will both your names be on it? What about insurance? Who will take which role and title? All these questions need firm answers because otherwise, things can get messy.

Make sure they bring skills to the table you don’t have.

Are you an inventory and accounting whiz? Are they an experienced chef with awesome people skills? Great.

A business partnership will be most useful and harmonious if all people bring different, complementary skills to the table, explains Entrepreneur.com. This way, you’ll have a good shot at feeling like you’re both pulling your weight. If both of you want to be executive chef/owner, it might not be an ideal partnership. Think about the skills that are essential to a restaurant owner, and make sure that between the two of you, you cover all the bases. 

A good partner is “someone that will be by your side, and that will help you with things you aren’t strong in, and vice versa,” said Brian Alvarez, co-owner of the family-run Mon Alyssa Restaurant in Point Pleasant, NJ.

Brainstorm your visions and sync them up.

Make sure you’re on the same page about almost everything, if not literally everything. The Founder Institute says that when starting a business, it’s easy to get excited and just run with your idea, but it’s crucial for all stakeholders to sit down and ask questions like:

• What do you want the business to look like five years from now?
• What kind of bosses do you want to be?
• What kind of employees will you be looking for? How will you keep them happy?
• What’ll be on the menu?
• What kind of restaurant atmosphere will you create? Where should you open?
• How will you spend your money? What kind of point of sale system will you invest in?
• What kind of impact do you want to have on your community?

Map out the worst-case scenarios and distribute responsibility.

From problems tiny to monumental, you’ll likely run into all of them in the course of your ownership of a restaurant. Mapping out the worst-case scenarios will prepare you for (almost) anything.

If there’s a late-night or early-morning equipment repair, a flood, or a break-in, who’s going to be the person to come in?

If you have to fire an employee , who will have that conversation?

If the restaurant fails , what will you do?

If one of you wants to move on, what’s the plan?

Be honest about personalities and personal histories.

You'll likely spend more time with your partner than you will your spouse, so this person needs to make you feel supported and encouraged most of the time. Don’t go into business with someone you’ve fought with many times or someone you wouldn’t trust with the keys to your house.

Be frank about money.

It seems obvious, but especially if you’re partnering with someone you know well, you’ve likely never had a frank conversation about money, numbers, and decimal points . Discuss how much money you can bring to the table and how much they can bring, because chances are you’re going to need a lot more, and it’s going to have to come from somewhere. Talk about loans, credit scores, and histories with debt.

Another element to consider is whether or not you can afford to have a partner, says Entrepreneur.com . Will your business be able to make enough money, and fast enough, to support yourself and your partner, as well as all of your dependents?

So, what kind of business partnership are you embarking on?

According to Investopedia , here’s a breakdown of the most common types of business partnerships.

Co-Owner: Your co-owner simply shares a percentage of your restaurant. What percentage, what roles, and what rights they’ll have within the business (including how profit, liability, and taxes will be handled) can vary depending on what kind of agreement you draw up.

General/Managing Partner: Similar to co-owner, a general partner is an owner of your restaurant, but they generally have equal authority to act on behalf of the entire business, so they have unlimited liability. If something goes wrong, they could be liable to pay or liquidate their assets.

Limited Partner: A limited partner is someone who owns part of the business but doesn’t take part in the day-to-day managing of the restaurant, so they'll have limited liability and won't have to risk their personal assets. Only one person must be a general partner, taking on the risk themselves.

Silent Partner: A silent partner is someone who has only given money to support the business. They’re not involved in restaurant operations or management. They also tend to be limited partners, with liability usually limited to the amount they invested.

Investor: Someone who gives you money to start/run your business with the expectation that they'll receive money back eventually. They don’t have a day-to-day role at the restaurant.

Now that you know the benefits and risks of business partnership and how to ensure it’s a mutually beneficial and successful partnership, there’s only one thing left to do: Seek out your business partner and get planning.

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DISCLAIMER: This information is provided for general informational purposes only, and publication does not constitute an endorsement. Toast does not warrant the accuracy or completeness of any information, text, graphics, links, or other items contained within this content. Toast does not guarantee you will achieve any specific results if you follow any advice herein. It may be advisable for you to consult with a professional such as a lawyer, accountant, or business advisor for advice specific to your situation.

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