Looking for a small restaurant business plan? You're in the right place.
A 44-seat room leaves little room for error, and a lender or investor will ask three things first. How much do you need to open? What does a week of service earn against what it costs? What happens if the room runs quieter than you hoped? A blank template won't show you what a believable answer looks like.
In this article we'll walk through a complete sample plan for a chef-owner restaurant in Austin, Texas, section by section, so you can see how the numbers fit together and write your own with confidence. We'll cover the executive summary, the SWOT and, in particular, all of the financials.
Here's what you'll take away:
- The executive summary: see how to put a restaurant on one page, including the hours, the menu and the raise, so a reader knows what is being asked within a minute
- The SWOT: learn how to state the risks of a one-chef kitchen honestly, without putting a lender off
- The opening budget: find out what a modest second-generation build-out, two months of pre-opening costs and a reserve add up to before the first guest
- The first year, month by month: spot the months that lose money before you get there and plan cash around the summer slowdown
- The marketing plan: see how a restaurant that leans on word of mouth spends a few thousand dollars and what each guest costs to win
- Prime cost and break-even: understand how food and labor together decide whether a small room makes money
- The downside case: have an answer ready for the "what if the room runs a fifth quieter?" question, along with the steps the owner takes
If you're planning a small restaurant, read this before you write your own. The restaurant is fictional, so take what fits your room and change the rest.
In this plan
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The Plan in Brief
Apex Kitchen is a 44-seat, chef-owner restaurant that opens in January 2027 in a leased, second-generation restaurant space in a north-central Austin neighborhood strip. The menu is short and seasonal. The room serves breakfast and lunch from Wednesday to Friday, brunch on Saturday and Sunday, and a limited dinner from Thursday to Saturday. It is closed Monday and Tuesday. Tomas Reyes cooks, owns a majority of the company and draws a salary from day one.
The company raises $340,000: $100,000 of Tomas's savings, $75,000 from one local private investor for a minority share, and a $165,000 bank term loan that the owners will seek with an SBA guarantee, subject to approval. Of that, $185,000 buys the build-out and equipment, $77,000 goes on opening costs expensed at launch (deposits included), $8,000 is opening stock and $70,000 stays as a reserve.
| Year 1 | Year 2 | Year 3 | |
|---|---|---|---|
| Revenue | $771,580 | $872,977 | $932,319 |
| Net income after start-up costs | ($53,617) | $40,543 | $59,210 |
| Closing cash | $97,528 | $116,932 | $131,918 |
Year 1 earns $23,383 before the opening costs and loses $53,617 after them. Revenue is still climbing through the first spring, because a new room fills over about nine months. In the model the restaurant is profitable from Year 2 and stays so, but that rests on the covers and prices in the plan: a 10% shortfall in revenue every year turns cash negative by Year 3.
The plan keeps the business small on purpose. Labor is the cost that sinks a restaurant of this size, so the room opens five days a week, runs a limited dinner on three nights and buys no second kitchen, no bar program and no event space. The kitchen has two full-time people, one of whom is the owner, and a line cook on 30 hours a week.
If revenue runs a fifth below plan and the owners respond from month 4 (no Year 2 cook or fourth server, part-time hours down, a pay cut for Tomas, trimmed marketing from Year 2 and distributions held back until Year 4), cash stays positive in every year of the model. Debt cover is still below 1.0x in Year 1, so the owners would ask the bank to start testing cover in Year 2.
What Apex Kitchen Is
Legal name: Apex Kitchen, LLC, a Texas limited liability company. Owners: Tomas Reyes (majority) and one local private investor (minority). The split is a planning figure for counsel to settle. Premises: about 1,800 square feet of leased, second-generation restaurant space with 44 seats and a small patio, in a neighborhood strip in north-central Austin. Opening: January 2027, after a two-month build-out and training period in the last quarter of 2026. The financial model books that spending and the loan draw in January 2027. Stage: pre-opening. The lease terms are in negotiation and no permit has been issued.
The idea in one line
A short menu cooked by its owner, served at a pace and price a neighborhood can use every week.
How the week is built
| Daypart | Days | Hours | How it runs |
|---|---|---|---|
| Breakfast and lunch | Wednesday to Friday | 7:30 a.m. to 2:30 p.m. | Order at the counter, food brought to the table |
| Brunch | Saturday and Sunday | 8 a.m. to 3 p.m. | Counter and table service, beer and wine from a Sunday start time set by state rules |
| Limited dinner | Thursday to Saturday | 5 to 9 p.m. | Eight plates and two desserts, table service |
| Takeout | Open days | During service | Counter, phone and the restaurant's own online ordering |
The room is open about 47 hours a week. Monday and Tuesday go to ordering, prep, deep cleaning and equipment service, which keeps paid hours low and the kitchen quiet enough to change the menu with the season.
Why a second-generation space
A former restaurant space already has a hood, a grease interceptor and a floor plan that passes inspection in principle. The $100,000 build-out budget, about $56 a square foot, covers design and plan review, a counter and pass-through, finishes and restroom work rather than a new kitchen. Whether the exhaust and grease systems are in working order is a lease-negotiation item, and the plan carries a 10% contingency against what the walk-through misses.
Alcohol and licensing
The restaurant sells beer and wine only. The Texas Alcoholic Beverage Commission issues the permits, and the exact permit class, fees and local requirements are for the owners to confirm before opening. If the permit arrived late, the room would open without it: beer and wine are 11% of Year 1 revenue and about $62,000 of gross profit, so a late permit would be felt, and some brunch guests would order less. Three months without the permit during the opening ramp cost roughly $12,000 of gross profit, which the reserve absorbs. Food service is permitted and inspected by the City of Austin. Texas food-safety rules call for trained food handlers and a certified food manager, and the requirements change, so both are treated as items to confirm with the city.
Who Eats Out Near Apex Kitchen
The trade in a neighborhood room
Austin has a large and varied restaurant scene, and the plan does not lean on a market-size figure. The question for a 44-seat room is narrower: how many people within a short drive will choose it for a weekday breakfast, a weekend brunch or an early dinner, and how often. The plan sets that at about 24,000 dine-in covers and 5,500 takeout orders in Year 1, about 92 covers on each of the 260 days the room is open. Year 3 rises to 26,800 covers and 6,900 orders.
What guests have to choose from
| Alternative | What it offers | Why a guest picks it | Where Apex Kitchen differs by design |
|---|---|---|---|
| National breakfast and fast-casual chains | Fast, predictable, long hours | Speed and familiarity | A seasonal menu cooked by the owner, a room built for sitting |
| Established local brunch cafes | Full menus, loyal crowds | Reputation, patios, waits that regulars accept | A shorter menu, a smaller room and takeout built into the daily rhythm |
| Food trailers and pop-ups | Low prices, novelty | Price and variety | Seating, shade, a fixed address and weekday hours |
| Grocery and convenience-store prepared food | Cheap, immediate | Convenience | Cooked to order, with table service on weekends |
| Neighborhood bars and full-service restaurants | Dinner and drinks | Evening atmosphere | Mornings, daytime prices and a dinner that ends at 9 |
The table describes categories, not named competitors. The owners would check the real set within a mile of the final address before signing a lease.
SWOT
| Strengths | Weaknesses |
|---|---|
| Owner in the kitchen, so quality and cost are watched together | Single-site, single-chef concept: if Tomas is out, service slips |
| Short menu keeps waste and prep hours down | Seasonal menu depends on supplier availability and price |
| Five open days and no late nights keep labor lean | Limited dinner earns less per seat than a full evening trade |
| Opportunities | Threats |
|---|---|
| Takeout and online orders add volume without seats | Austin summer slows daytime traffic |
| Weekday regulars from nearby offices and homes | Food and labor inflation can outrun menu prices |
| A catering or private-room line later, if volume supports it | A new brunch spot or chain opening nearby |
The Regulars Apex Kitchen Is Built For
Four kinds of guest
Weekday breakfast and lunch: people who live or work within a short drive and want a seasonal, cooked-to-order meal without a long wait. Many order at the counter and sit for 30 to 45 minutes.
Weekend brunch: couples, families and small groups. Brunch is the largest line, at 33% of Year 1 revenue, and the one that needs the most seats and servers.
Early dinner: neighbors who want a table without a big night out. The limited menu and the 9 p.m. close are the point.
Takeout: orders placed by phone or online, picked up at the counter. This line is 15% of Year 1 revenue and 16% of Year 3, and it fills quiet weekday hours.
What they are buying
Food that tastes of the season, a short wait, a fair check and a place that remembers them. The average dine-in guest spends about $27.50 on food and drink in Year 1, and a takeout order averages $20.50.
What they compare it with
Another table down the street, or a kitchen at home. The plan does not claim a unique concept, only a consistent one.
Selling the Menu
How the check builds
| Line | Year 1 price | What it covers |
|---|---|---|
| Weekday breakfast and lunch | $18.00 | One plate and coffee or a soft drink |
| Weekend brunch | $24.00 | A plate, a side or a pastry, and a drink |
| Limited dinner | $34.00 | A plate and a share of a starter or dessert |
| Beer and wine | $10.00 | A glass or a pint, about 0.55 drinks per brunch or dinner cover |
| Takeout order | $20.50 | A plate or two and a drink |
Menu prices step up 3% a year from Year 2, so Year 3 dinner averages $36.07. The owners review covers and average check every month to see whether volume holds as prices move.
Seasonality
Spring and fall carry the room. June to August run about 7% to 11% below an average month, because the heat and the university break thin the daytime trade. Year 1 also carries an opening ramp from 60% of steady volume in January to full volume by September, so Year 1 months read lower than the same months would in a mature year.
Capacity
Weekend brunch is the pinch point. Year 3 brunch runs about 113 covers a day on 44 seats, or 2.6 turns over a seven-hour service. Weekday lunch and dinner sit well below that. If brunch demand outruns the room, the answer is a short wait and a waitlist, not a larger lease.
Word of Mouth on a Small Budget
What the money buys
Year 1 marketing is $22,000: $7,000 of launch spending funded from the start-up capital and $15,000 of operating spend. That is 2.9% of Year 1 revenue; operating spend alone is 1.9% in Year 1 and 1.3% in Year 3. Operating spend works out to about $0.51 for each dine-in cover or takeout order in Year 1, or $0.75 with the launch spending included. The figure is deliberately low for an owner with no paid advertising, and the owners would add to it before they cut staff.
| Item | Year 1 spend | Purpose |
|---|---|---|
| Signage and exterior (launch) | $2,500 | Visible from the street and from passing traffic |
| Soft-open tastings for neighbors (launch) | $1,500 | Friends, nearby offices and the landlord's other tenants |
| Direct mail to nearby addresses (launch) | $1,500 | About 3,000 households in the first mile |
| Photography and web page (launch) | $1,500 | Menu, hours and online ordering link |
| Local social posts and boosted posts | $4,500 | A weekly menu post and boosted posts for brunch |
| Google business profile and photography | $2,400 | Hours, menu and photos kept current |
| Neighborhood events and tasting tables | $3,900 | Farmers market tables, school and office events |
| Loyalty card and email list | $1,200 | A free coffee every tenth visit; a monthly email |
| Printed menus, bags and stickers | $1,800 | Takeout packaging with the address and order link |
| Food-writer and local-account invitations | $1,200 | Two tasting evenings a year |
The launch rows are the first four and the running spend is the last six.
The plan for repeat visits
Regulars drive a room like this. The loyalty card, the email list and a monthly "what is in season" note are the only retention tools, and they cost less than $2,000 a year. The plan counts no paid advertising, no coupon sites and no delivery-platform promotions.
The Kitchen, the Floor and the Week
The room
About 1,800 square feet at roughly $45 a square foot a year all in, which is $81,000 in Year 1 (10.5% of revenue, falling to 9.2% in Year 3). The figure covers rent, common-area charges and property taxes, and it is a planning figure for a broker to check against current north-central Austin asking rents. The lease is still in negotiation. The plan is built on a term of about ten years with a renewal option and a personal guarantee from the owners, and the term, the annual steps, the deposit and any landlord allowance are for the landlord and counsel to settle.
The kitchen
A single line: range, flat-top, fryer, a reach-in and a walk-in cooler, and a dish machine. A mix of used and new equipment keeps the $58,000 kitchen budget. The menu is built so that most plates share prep, which is why Tomas, a lead and a 30-hour line cook can turn out brunch.
Suppliers and stock
A broadline food distributor, a local produce supplier and a coffee roaster supply most of the menu, with a beer and wine wholesaler for drinks. Stock is $8,000 at opening and about $10,300 by the end of Year 1, roughly two and a half weeks of direct cost. A new account is likely to start on cash or net-7 terms, so the model uses about seven days of credit.
Who works the week
Two full-time people: Tomas and a kitchen lead. Nine part-time roles cover a 30-hour line cook, the front-of-house lead, the weekend brunch cook, dish and prep, a floor runner and busser, three servers and the counter. Two more, a dinner and weekend cook and a fourth server, join in month 14, when Year 2 volume is running well above Year 1. Payroll adds 27% for full-time and 20% for part-time staff for payroll taxes, workers' compensation and a paid-leave allowance, all planning rates.
Technology
A point-of-sale system with online ordering and kitchen printers, $7,000 to set up and $7,000 a year in software and subscriptions. Card processing is about 2.3% to 2.4% of revenue.
Insurance, permits and safety
General liability, liquor liability, property and key-person cover are budgeted at about $13,000 a year, with workers' compensation inside the payroll on-costs, plus the food-service permit, the beer and wine permit and local licenses. A certified food manager is on shift whenever the kitchen is open. Hood cleaning and grease-trap service are scheduled, not left for a problem.
The Crew and the Owner
Tomas Reyes, chef-owner
Tomas has spent twelve years in Austin kitchens, the last five as the kitchen lead and then the chef of a busy daytime restaurant. He has run purchasing and a weekly schedule but has not owned a lease or a loan. He invests $100,000 of savings and draws $58,000 a year, subject to the same pay-raise schedule as staff.
Where the team is thin
Tomas has not run a business through a slow summer, has not hired a full crew from nothing and is the only person who writes the menu. The plan covers this with a front-of-house lead from day one, a kitchen lead who can run the line, a bookkeeper on retainer and a weekly cost review.
If Tomas is out
The kitchen lead runs the line, the front-of-house lead runs the floor, and the menu reverts to a fixed core for the week. The company carries key-person cover on Tomas, budgeted within insurance.
Outside help
A restaurant accountant on retainer, a lawyer for the lease and the entity documents, and the local Small Business Development Center for the loan package. None of them is hard to replace.
Ownership and the bank
Tomas holds the majority of Apex Kitchen, LLC, and one local investor holds a minority share. The investor's $75,000 buys a minority share and distributions in proportion to ownership. The plan has no fixed exit: the investor's return comes from those distributions and from a buyback by Tomas or a sale of the company after Year 5, at a price and on terms for counsel to settle. The bank will ask for a personal guarantee, a lien on equipment and quarterly accounts; the exact terms are the lender's to set.
What a 44-Seat Room Earns and Spends
The tables below come from one model: month by month through 2027, then year by year. Year 1 gets the monthly view because a new room opens near 60% of its steady volume and does not fill until about September. Covers, prices and cost rates are set out first, so every revenue line traces back to a plate, a glass or a pickup order.
Opening costs and who pays for them
| Use of funds | Amount |
|---|---|
| Build-out of a second-generation restaurant space: design and plan review, counter and pass-through, paint and finishes, restroom work and a 10% contingency | $100,000 |
| Kitchen: used and new range line, flat-top, fryer, reach-in and walk-in refrigeration, dish machine | $58,000 |
| Dining room and counter: tables, chairs, patio seating, smallwares and glassware | $20,000 |
| Point of sale, online ordering and kitchen printers | $7,000 |
| Opening food, coffee, beer and wine stock | $8,000 |
| Legal and accounting: lease review, entity, loan documents | $8,000 |
| Food establishment permit, beer and wine permit and local licenses (planning figure) | $6,000 |
| Pre-opening: two months of rent, utilities and insurance, plus kitchen and floor training | $40,000 |
| Refundable deposits: two months' rent as a lease security deposit and utility deposits (booked as spent in the model although recoverable) | $16,000 |
| Launch: exterior signage, neighborhood mailers, opening-week tastings and photography | $7,000 |
| Cash reserve for the opening ramp and the summer slowdown | $70,000 |
| Total uses | $340,000 |
| Source of funds | Amount |
|---|---|
| Tomas Reyes: personal savings | $100,000 |
| One local private investor (minority equity) | $75,000 |
| Community bank term loan (SBA guarantee sought, subject to approval) | $165,000 |
| Total sources | $340,000 |
The company raises $340,000. Tomas Reyes puts in $100,000 of savings and one local private investor puts in $75,000 for a minority share, so equity is $175,000 (51% of the total) and a $165,000 community bank term loan supplies the remaining 49%. The loan runs five years at a planning rate of 9.5%, with no principal due for the first six months. The owners would seek an SBA guarantee, which is not certain; the rate, term, collateral and any guarantee fee are the lender's to set. The money goes to a $100,000 build-out (about $56 a square foot, with design and plan review and a 10% contingency, and no landlord allowance counted), $85,000 of kitchen, dining-room and technology equipment, $8,000 of opening stock and $77,000 of costs expensed at opening. That $77,000 covers legal and accounting, permits and licenses, two months of carrying costs and training, launch marketing and $16,000 of lease and utility deposits, which the model books as spent although they are recoverable. A $70,000 reserve is left over. The build-out would really run in the last quarter of 2026, but the model books all spending and the loan draw in January 2027 and starts the interest-only period then, so the interest on loan draws during the fit-out (a few thousand dollars) is not modeled and would come out of the reserve. Month-end cash is lowest in March 2027, at about $45,000 once two days of card settlements still in transit are set aside. That is less than a month of operating costs, and the owners would watch it weekly. A late permit is the main risk to that figure. Rent, utilities, insurance and loan interest come to about $11,000 a month with the doors shut, and payroll adds roughly $23,800 a month once the crew is on the schedule. A one-month slip after hiring would take the low point to roughly $10,000. Anything longer would need a bank deferral, deferred rent or more equity.
Covers, tickets and cost rates
- Weekday breakfast and lunch (Wednesday to Friday) is priced at $18.00 a cover in Year 1: one plate and a coffee or soft drink. Year 1 seats 8,440 covers, about 54 a day over 156 days. Year 3 seats 9,500 (about 61 a day) at $19.10, after two 3% menu steps.
- Weekend brunch is priced at $24.00 a cover. Year 1 seats 10,551 covers, about 101 a day over 104 weekend days; Year 3 seats 11,700, about 113 a day, which is 2.6 turns of the 44 seats across a seven-hour service, at $25.46. Brunch is the pinch point for seats and floor staff. Three servers carry it only with the front-of-house lead and the runner on the floor as well, and a fourth server starts in month 14.
- Limited dinner (Thursday to Saturday) is priced at $34.00 a cover: a plate plus a share of a starter or dessert. Year 1 seats 4,960 covers, about 32 a night; Year 3 seats 5,600, about 36 a night and under one turn of the room, at $36.07.
- Beer and wine average $10.00 a glass or pint, at 0.55 drinks per brunch or dinner cover: 8,530 drinks in Year 1 and 9,515 in Year 3 at $10.61. They bring in $85,310 in Year 1, which is 11% of revenue, and about $62,000 of gross profit. If the permit were three months late, the loss would be roughly $12,000 of gross profit in the opening ramp, plus some brunch spend, and the reserve could carry it.
- Takeout and pickup orders average $20.50: 5,487 orders in Year 1 and 6,900 in Year 3 at $21.75, about 21 and 27 a day over the 260 open days. Delivery-platform and online-ordering fees sit on their own cost line, since only a minority of orders is expected to come through a third-party platform.
- Direct costs are 28% of weekday breakfast and lunch, 27% of brunch, 31% of dinner, 27% of beer and wine and 31% of takeout, packaging included. The engine applies one blended rate from the Year 1 mix to every year, 28.7% of revenue (28.9% on the food lines), so the per-line percentages hold only in Year 1. A broadline distributor, a produce supplier and a coffee roaster set the real prices, and supplier quotes would replace these planning rates.
- Payroll adds 27% to full-time pay and 20% to part-time pay for payroll taxes, workers' compensation and a paid-leave allowance; these are planning rates for a Texas payroll provider to confirm. The two full-time roles carry $104,000 of wages and the nine Year 1 part-time roles $127,500, as annual pay for 15 to 30 hours a week. The federal minimum wage is $7.25 an hour and Texas follows it for most employers, with a federal tipped cash-wage floor of $2.13 an hour (rules as understood at the time of writing; the Department of Labor and the Texas Workforce Commission state the current figures). A server's $7,500 is a cash wage of about $5.77 an hour for 25 hours a week, above the tipped floor, with tips on top. The model leaves tips out of revenue and pay but includes $4,700 of employer payroll tax on them in Year 1, a planning figure of 7.65% on tips of roughly 15% of table-service sales; the federal credit for that tax is not modeled. The kitchen lead's $46,000 works out to about $885 a week, above the federal weekly salary level for the executive exemption ($684 a week, or $35,568 a year, as understood), but the exemption also depends on duties. A lead who mostly cooks may be owed overtime, and at an hourly equivalent of about $22 each overtime hour would cost roughly $11 more than straight time; the model carries no separate overtime line. Pay raises of 3% a year are a separate line from Year 2. The monthly view holds the roster flat, so January and February carry the full crew.
- Rent is $81,000 in Year 1 for about 1,800 square feet, roughly $45 a square foot a year with common-area charges and property taxes, rising 3% a year. That is 10.5% of Year 1 revenue and 9.2% of Year 3, and it is a planning figure for a broker to test against north-central Austin asking rents. Utilities of $22,500 (2.9% of Year 1 revenue) reflect a Texas summer cooling load. Insurance of $13,000 covers general liability, liquor liability, property and key-person cover. Professional fees of $10,000 pay for a bookkeeper on retainer, the payroll provider, counsel and the year-end return. Card processing runs at 2.3% to 2.4% of revenue, depending on the processor. The $100,000 build-out and $58,000 kitchen suit a second-generation space with a working hood and grease interceptor, and a contractor's bid would replace them.
- Receivables take two days, the card-settlement lag. New supplier accounts probably open on cash or net-7 terms, so the model allows about seven days of credit. Stock is $8,000 at opening and about $10,300 at the end of Year 1, roughly two and a half weeks of direct cost with beer and wine included.
- Federal tax is 21% of taxable income under 26 U.S.C. 11(b). The state line uses 0.75% as a planning figure for the Texas franchise tax, which is charged on margin rather than profit. The Comptroller lists 0.375% for retail or wholesale businesses and 0.75% for others, and whether a restaurant counts as retail is for the Comptroller and a CPA to confirm. Its no-tax-due threshold is $2,650,000 of revenue for 2026 and 2027 reports, far above this room's sales, so the true charge may be nil. The company is an LLC that would be taxed as a partnership by default, and an election would move the federal tax to the owners; the corporate rate is a cautious planning figure. The model's tax base ignores start-up costs and does not apply the federal 80% limit on loss carryforwards. Sales tax collected from guests is passed on and excluded from revenue.
- Owner distributions are $10,000, $30,000, $45,000 and $55,000 in Years 2 to 5, $140,000 in all against $205,912 of cumulative net income after start-up costs. Each is smaller than that year's operating cash less loan principal ($29,404, $44,986, $55,815 and $64,661), and the Year 5 payout is 64% of that year's net income. Retained earnings turn positive in Year 3. The money is shared between the chef-owner and the investor by ownership, after Tomas's salary. The investor's terms (share, any preference, any buyback or sale after Year 5) are for counsel to settle, and a lender would likely set a minimum cash balance before any payout.
Revenue by daypart
| Revenue stream | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| Weekday breakfast and lunch (Wednesday to Friday) | $151,920 | $170,568 | $181,414 | $190,790 | $198,540 |
| Weekend brunch (Saturday and Sunday) | $253,224 | $279,336 | $297,901 | $312,083 | $324,147 |
| Limited dinner (Thursday to Saturday) | $168,640 | $189,108 | $201,995 | $211,770 | $221,950 |
| Beer and wine | $85,310 | $94,606 | $100,945 | $105,776 | $110,187 |
| Takeout and pickup orders | $112,486 | $139,359 | $150,064 | $159,046 | $168,432 |
| Total revenue | $771,580 | $872,977 | $932,319 | $979,465 | $1,023,256 |
| Growth on prior year | – | 13% | 7% | 5% | 4% |
Weekend brunch is the largest line, at 33% of Year 1 revenue, followed by dinner at 22% and weekday breakfast and lunch at 20%. Takeout is 15% and beer and wine 11%. Takeout rises to 16% by Year 3 because it adds volume without adding seats, while brunch holds near 32% as it approaches the capacity of the room.
The first year, month by month
| Month | Weekday breakfast and lunch (Wednesday to Friday) | Weekend brunch (Saturday and Sunday) | Limited dinner (Thursday to Saturday) | Beer and wine | Takeout and pickup orders | Total revenue | EBITDA |
|---|---|---|---|---|---|---|---|
| Jan 2027 | $7,776 | $12,960 | $8,636 | $4,370 | $5,761 | $39,503 | ($12,131) |
| Feb 2027 | $9,306 | $15,504 | $10,336 | $5,230 | $6,888 | $47,264 | ($6,594) |
| Mar 2027 | $11,484 | $19,152 | $12,750 | $6,450 | $8,508 | $58,344 | $1,311 |
| Apr 2027 | $12,906 | $21,504 | $14,314 | $7,240 | $9,553 | $65,517 | $6,429 |
| May 2027 | $13,068 | $21,792 | $14,518 | $7,340 | $9,676 | $66,394 | $7,054 |
| Jun 2027 | $12,312 | $20,544 | $13,668 | $6,920 | $9,123 | $62,567 | $4,324 |
| Jul 2027 | $12,168 | $20,280 | $13,498 | $6,830 | $9,000 | $61,776 | $3,760 |
| Aug 2027 | $12,708 | $21,168 | $14,110 | $7,130 | $9,410 | $64,526 | $5,722 |
| Sep 2027 | $14,400 | $24,000 | $15,980 | $8,090 | $10,660 | $73,130 | $11,860 |
| Oct 2027 | $15,840 | $26,400 | $17,578 | $8,890 | $11,726 | $80,434 | $17,071 |
| Nov 2027 | $15,552 | $25,920 | $17,272 | $8,730 | $11,521 | $78,995 | $16,045 |
| Dec 2027 | $14,400 | $24,000 | $15,980 | $8,090 | $10,660 | $73,130 | $11,860 |
Revenue starts at $39,503 in January on the ramp, reaches $66,394 in May and slips to $61,776 in July in the summer heat. October is the strongest month at $80,434. EBITDA is negative in January and February and positive from March on. September to December produce $56,836 of it, 85% of the $66,709 full-year figure. Month-end cash is lowest in March 2027, at about $45,000, after setting aside two days of card settlements (the engine's unadjusted low is about $48,700, in February). The monthly view spreads each year's annual costs evenly, so the pre-opening months are approximate.
Who is on the schedule
| Role | Annual wage | Starts | Year 1 end | Year 2 end | Year 3 end | Year 4 end | Year 5 end |
|---|---|---|---|---|---|---|---|
| Chef-owner (Tomas Reyes) | $58,000 | Month 1 | 1 | 1 | 1 | 1 | 1 |
| Kitchen lead | $46,000 | Month 1 | 1 | 1 | 1 | 1 | 1 |
| Line cook (part time, 30 hours a week) | $28,000 | Month 1 | 0.5 | 0.5 | 0.5 | 0.5 | 0.5 |
| Front-of-house lead (part time) | $22,000 | Month 1 | 0.5 | 0.5 | 0.5 | 0.5 | 0.5 |
| Weekend brunch cook (part time) | $14,000 | Month 1 | 0.5 | 0.5 | 0.5 | 0.5 | 0.5 |
| Dishwasher and prep (part time) | $17,000 | Month 1 | 0.5 | 0.5 | 0.5 | 0.5 | 0.5 |
| Floor runner and busser (part time) | $11,000 | Month 1 | 0.5 | 0.5 | 0.5 | 0.5 | 0.5 |
| Server A (part time) | $7,500 | Month 1 | 0.5 | 0.5 | 0.5 | 0.5 | 0.5 |
| Server B (part time) | $7,500 | Month 1 | 0.5 | 0.5 | 0.5 | 0.5 | 0.5 |
| Server C (part time) | $7,500 | Month 1 | 0.5 | 0.5 | 0.5 | 0.5 | 0.5 |
| Server D (part time) | $7,500 | Month 14 | – | 0.5 | 0.5 | 0.5 | 0.5 |
| Counter and takeout (part time) | $13,000 | Month 1 | 0.5 | 0.5 | 0.5 | 0.5 | 0.5 |
| Dinner and weekend line cook (part time) | $22,000 | Month 14 | – | 0.5 | 0.5 | 0.5 | 0.5 |
| Total payroll incl. on-costs | $285,080 | $317,530 | $320,480 | $320,480 | $320,480 |
The room opens with two full-time roles, the chef-owner and a kitchen lead, and nine part-time roles: a 30-hour line cook, a front-of-house lead, a weekend brunch cook, dish and prep, a floor runner and busser, three servers and a counter person. That is 6.5 full-time equivalents, counting each part-time role as half. Two more part-time roles start in month 14, a dinner and weekend line cook and a fourth server, taking the roster to 7.5. By then Year 2 volume is running about 1,950 dine-in covers and 1,100 takeout orders above Year 1. Nothing else is added: the rest of the Year 2 revenue gain is the opening ramp rolling off. Year 1 payroll with on-costs is about $23,800 a month.
Profit and loss
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|
| Revenue | $771,580 | $872,977 | $932,319 | $979,465 | $1,023,256 |
| Direct costs (food, coffee, beer and wine) | ($221,091) | ($250,145) | ($267,149) | ($280,659) | ($293,207) |
| Gross profit | $550,489 | $622,832 | $665,170 | $698,806 | $730,049 |
| Payroll incl. on-costs | ($285,080) | ($317,530) | ($320,480) | ($320,480) | ($320,480) |
| Rent | ($81,000) | ($83,400) | ($85,900) | ($88,500) | ($91,200) |
| Utilities | ($22,500) | ($23,100) | ($23,700) | ($24,400) | ($25,100) |
| Marketing | ($15,000) | ($12,000) | ($12,000) | ($12,500) | ($13,000) |
| Insurance | ($13,000) | ($13,400) | ($13,800) | ($14,200) | ($14,600) |
| Professional fees | ($10,000) | ($10,300) | ($10,600) | ($10,900) | ($11,200) |
| Software subscriptions | ($7,000) | ($7,200) | ($7,400) | ($7,600) | ($7,800) |
| Employer payroll tax on tips | ($4,700) | ($5,400) | ($5,800) | ($6,100) | ($6,400) |
| Card processing fees | ($17,500) | ($20,800) | ($22,500) | ($23,800) | ($24,800) |
| Third-party delivery and online ordering fees | ($2,500) | ($3,500) | ($3,800) | ($4,000) | ($4,200) |
| Repairs, hood cleaning and equipment service | ($6,500) | ($8,000) | ($9,000) | ($10,000) | ($11,000) |
| Smallwares and equipment replacement | ($3,500) | ($5,500) | ($6,000) | ($6,500) | ($7,000) |
| Cleaning, linen, uniforms and paper goods | ($8,000) | ($9,000) | ($9,500) | ($9,800) | ($10,100) |
| Licenses, permits and music licensing | ($2,500) | ($2,600) | ($2,700) | ($2,800) | ($2,900) |
| Waste hauling, grease trap and pest control | ($4,500) | ($4,700) | ($4,900) | ($5,100) | ($5,300) |
| Bad debt and write-offs | ($500) | ($800) | ($900) | ($1,000) | ($1,000) |
| Annual pay raises (3% a year) | $0 | ($9,526) | ($19,517) | ($29,717) | ($40,223) |
| EBITDA | $66,709 | $86,076 | $106,673 | $121,409 | $133,746 |
| Depreciation | ($21,507) | ($21,507) | ($21,507) | ($21,507) | ($21,507) |
| Interest | ($15,380) | ($12,860) | ($9,650) | ($6,121) | ($2,243) |
| Income tax | ($6,439) | ($11,165) | ($16,306) | ($20,250) | ($23,751) |
| Net income before start-up costs | $23,383 | $40,543 | $59,210 | $73,531 | $86,245 |
| Start-up costs expensed at opening (legal, permits, pre-opening costs, deposits, launch marketing) | ($77,000) | $0 | $0 | $0 | $0 |
| Net income after start-up costs | ($53,617) | $40,543 | $59,210 | $73,531 | $86,245 |
Net income before start-up costs is $23,383 in Year 1, and it becomes a loss of $53,617 once the $77,000 of opening costs is counted. Year 1 EBITDA is $66,709, or 8.6% of revenue, which is a generous margin for a room that opens at 60% of steady volume and depends on the ramp arriving on schedule. Net income is then $40,543 in Year 2, $59,210 in Year 3, $73,531 in Year 4 and $86,245 in Year 5. The EBITDA margin climbs from 9.9% in Year 2 to 11.4% in Year 3 and 13.1% in Year 5, because payroll stays at $320,480 from Year 3 and only the pay raises add to it. Payroll with raises is 37% of Year 1 revenue and 36% of Year 3. The restaurant is profitable from Year 2 in the model, and that rests on the covers and prices above.
Cash in and out
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|
| Cash from operations | ($42,412) | $61,748 | $80,540 | $94,897 | $107,622 |
| Kitchen, dining room and build-out | ($185,000) | $0 | $0 | $0 | $0 |
| Funding received | $340,000 | $0 | $0 | $0 | $0 |
| Loan principal repaid | ($15,060) | ($32,344) | ($35,554) | ($39,082) | ($42,961) |
| Owner distributions | $0 | ($10,000) | ($30,000) | ($45,000) | ($55,000) |
| Net change in cash | $97,528 | $19,404 | $14,986 | $10,815 | $9,661 |
| Closing cash | $97,528 | $116,932 | $131,918 | $142,734 | $152,394 |
Year 1 closes with $97,528: the $340,000 raised, less $185,000 spent on build-out and equipment, $15,060 of loan principal and $42,412 absorbed by operations after the $77,000 of opening costs. Cash then climbs each year to $152,394 in Year 5, even as distributions grow to $55,000, because every payout is held below operating cash less principal. The loan is cleared on schedule by the end of Year 5. The Year 5 balance is about two months of operating costs, a cushion against a slow summer or a supplier-price spike, and also idle money that the owners could use to prepay debt or distribute once a lender's minimum-cash terms are known.
Balance sheet
| At year end | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| Cash | $97,528 | $116,932 | $131,918 | $142,734 | $152,394 |
| Accounts receivable | $4,228 | $4,783 | $5,109 | $5,367 | $5,607 |
| Food, coffee, beer and wine stock | $10,315 | $10,619 | $10,797 | $10,938 | $11,070 |
| Kitchen, dining room and build-out (net) | $163,493 | $141,986 | $120,479 | $98,971 | $77,464 |
| Total assets | $275,563 | $274,320 | $268,302 | $258,010 | $246,535 |
| Supplier payables (food distributors and beer and wine wholesalers) | $4,240 | $4,797 | $5,123 | $5,383 | $5,623 |
| Bank term loan | $149,940 | $117,597 | $82,043 | $42,961 | $0 |
| Paid-in capital | $175,000 | $175,000 | $175,000 | $175,000 | $175,000 |
| Retained earnings | ($53,617) | ($23,074) | $6,136 | $34,667 | $65,912 |
| Total liabilities and equity | $275,563 | $274,320 | $268,302 | $258,010 | $246,535 |
Prime cost, break-even and loan cover
| Measure | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| EBITDA margin | 8.6% | 9.9% | 11.4% | 12.4% | 13.1% |
| Net margin (before start-up costs) | 3.0% | 4.6% | 6.4% | 7.5% | 8.4% |
| Payroll incl. pay raises as share of revenue | 37% | 37% | 36% | 36% | 35% |
| Revenue per full-time equivalent at year end | $118,705 | $116,397 | $124,309 | $130,595 | $136,434 |
| Average monthly revenue | $64,298 | $72,748 | $77,693 | $81,622 | $85,271 |
| Monthly revenue needed to cover operating costs | $56,507 | $62,694 | $65,234 | $67,441 | $69,649 |
| Debt service cover (EBITDA / interest + principal) | 2.2x | 1.9x | 2.4x | 2.7x | 3.0x |
Prime cost, meaning direct costs plus payroll and pay raises, is 65.6% of revenue in Year 1, 65.1% in Year 3 and 63.9% in Year 5. The common rule of thumb of about 65% is a convention, not a regulatory figure, and Year 1 sits just above it during the ramp. The break-even row is an operating break-even: it leaves out loan payments, which add about $2,500 a month on average in Year 1 (interest only for six months, then about $3,770) and $3,770 a month from Year 2. Year 1 needs $56,507 a month against an average of $64,298, a cushion of 14%. January and February fall short and March is the first month above the line. Year 3 needs $65,234 against $77,693, a cushion of 19%. Debt service cover is EBITDA divided by interest plus principal, before tax and distributions: 2.2x in Year 1 and 1.9x in Year 2. After tax it is 2.0x and 1.7x, and after tax and planned distributions it is 1.4x in Year 2, 1.3x in Year 3 and 1.2x in Years 4 and 5.
If the room runs a fifth quieter
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|
| Revenue | $617,264 | $698,382 | $745,855 | $783,572 | $818,605 |
| Net income before start-up costs | ($39,146) | $24,380 | $39,488 | $48,154 | $58,792 |
| Net income after start-up costs | ($116,146) | $24,380 | $39,488 | $48,154 | $58,792 |
| Closing cash | $35,460 | $48,761 | $74,061 | $79,528 | $81,761 |
Every revenue line is 20% lower in every year here. The owners watch three months of trading before they act, so the response starts in month 4: the dinner and weekend cook and the fourth server are never hired, part-time hours fall 20%, the kitchen lead's hours 5% and Tomas takes a 20% pay cut. The Year 1 annual cost lines (marketing, utilities, repairs, smallwares, cleaning) are left untrimmed, because the model spreads them evenly across the year and a cut would claim savings in months already spent. From Year 2, marketing falls 20%, utilities 4%, smallwares spending is halved and repairs and cleaning are trimmed. Card and delivery fees and the employer tax on tips follow sales throughout. Distributions are scaled to $25,000 in Year 4 and $35,000 in Year 5, against $45,000 and $55,000 in the base case, and none are paid before then. Rent is not renegotiated, and a landlord conversation would be the next lever.
Year-end cash stays positive and below the base case every year, at its lowest ($35,460) at the end of Year 1. The monthly low is about $22,000, in August 2027, against $44,777 in March in the base case. Year 1 loses $116,146 after start-up costs and equity ends the year at $58,854. Profit returns in Year 2 at $24,380 and reaches $39,488 in Year 3. Year 1 EBITDA is a loss of $2,259, so debt cover is below 1.0x; it is 1.3x in Year 2 and 1.7x in Year 3. A likely 1.25x covenant would therefore fail in Year 1 and clear Year 2 by little. The owners would ask the bank to begin testing cover in Year 2, or to grant a covenant holiday for the first 12 months. A further six months of interest-only would add about $14,800 to Year 1 cash and lift the August low to about $26,900, but it moves principal into Year 2, where cover falls to 1.2x. It is a fallback to the later test date. The monthly view is approximate.
Other ways the base case could fall short
Each case below runs on the base plan with the planned distributions and no management response. Cover is EBITDA over interest plus principal.
| Case | Year 1 cover | Year 2 cover | Lowest month-end cash, Year 1 | Closing cash, Year 1 | Closing cash, Year 3 | Closing cash, Year 5 |
|---|---|---|---|---|---|---|
| Base case | 2.2x | 1.9x | $44,777 | $97,528 | $131,918 | $152,394 |
| Revenue 10% lower in every year | 0.4x | 0.5x | $27,391 | $49,149 | ($17,742) | ($103,485) |
| Direct costs 3 points higher | 1.4x | 1.3x | $40,424 | $79,823 | $71,841 | $45,261 |
| First six months of revenue 15% lower | 1.0x | 1.9x | $22,086 | $67,777 | $103,423 | $123,899 |
| Rent 10% higher | 1.9x | 1.7x | $42,752 | $91,177 | $112,293 | $118,679 |
| No beer and wine permit for three months | 1.8x | 1.9x | $33,711 | $88,394 | $122,241 | $142,165 |
A 10% revenue shortfall that lasts all five years is the case that breaks the plan as written: cash turns negative in Year 3. With distributions stopped, the same case keeps cash positive, with a low of $22,258 at the end of Year 3, and ends Year 5 at $36,515, so halting payouts is the first lever. A cost shock of three points on direct costs leaves cash positive but cuts Year 5 cash to $45,261.
Questions the Numbers Leave Open
What a lender would still ask
- A signed lease, or at least a term sheet: the term, annual steps, deposit, any landlord allowance and the exact personal guarantee. The $45 a square foot is a planning figure, and a 10% rent rise takes about $34,000 off Year 5 cash.
- A contractor's bid and the condition of the hood and grease interceptor. The 10% contingency is the only cover, and the model counts the build-out as a single January 2027 payment although the work runs in the last quarter of 2026.
- Evidence for the covers: 101 brunch covers a day in Year 1 and 113 in Year 3 on 44 seats, and 54 weekday covers a day from a room that is not yet open. The trade area, comparable rooms and pre-opening signals would be asked for.
- A covenant package. Debt cover is 2.2x in Year 1 on the base plan but below 1.0x in the one-fifth downside, so the owners would ask for the first test in Year 2.
- How the owners pay themselves and the investor: the salary, the distribution policy and the minimum cash balance. A 10% revenue shortfall turns cash negative in Year 3 if distributions continue.
- Who runs the kitchen when Tomas is out, and the key-person cover that backs the answer.
- Overtime and tipped-wage treatment of the kitchen lead and the servers, confirmed with a payroll provider, and the Texas franchise tax classification, confirmed with a CPA.
- How the investor exits, and whether the loan and the investor's terms leave the personal guarantee on Tomas alone.
Sources
- Texas Alcoholic Beverage Commission, permits and licensing. The permit class, fees and Sunday-hours rules for beer and wine are to be confirmed there. The page was not used for any figure.
- City of Austin, Environmental Health Services. Food establishment permitting and inspection.
- Texas Department of State Health Services, retail food establishments. State food-safety requirements, to be confirmed against current rules.
- Texas Comptroller, franchise tax and sales and use tax. Described in general terms; the state rate in the model is a planning figure.
- Wage, rent, utility, supplier and insurance figures are planning figures for this example, not quoted from a published survey.
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