Retail

The point of purchase (POP) and point of sale (POS) are two important transactional elements of every retail store. Although some people use the terms interchangeably, POP and POS don’t mean the same thing. So what’s the difference? The POP is the point at which a shopper decides to buy an item, and the POS is where they pay for that item. POP displays promote products and build awareness, while the POS system processes transactions and helps you manage other parts of the business. Let’s take a closer look. POP and POS in Brick-and-Mortar Stores Point of purchase: The POP is the location where the customer makes their decision to purchase a product. Despite how it sounds, the point of purchase can be anywhere in the store—not just where the transaction takes place. You’ll typically hear POP used when talking about in-store displays and marketing strategies. Point-of-purchase display: A POP display is signage or merchandise that captures a shopper’s attention. You commonly see POP displays at cash registers or where customers are waiting to make a purchase. POP displays can also be endcaps, shelves, cardboard signs, and other in-store signage and visual merchandising. Point of sale: The POS refers to the moment (including the time and place) when a customer makes a purchase. Essentially, the POS is where the transaction actually happens. Point-of-sale system: A POS system is used in in-person selling environments. It refers to the hardware and software that actually administers and processes the transaction. Hardware might include a card reader, barcode scanner, receipt printer, computer or mobile device, and cash drawer. The software handles payment processing, inventory management, warehousing, and accounting. The POS system is also sometimes called the POS terminal or just the POS. POP and POS in Ecommerce Stores POP: Although they serve a similar purpose, in-store and digital POP displays are different. Ecommerce POP displays could be anything from branded shopping apps and pop-up deals during checkout to sample-size products. Online retail is rapidly evolving—expect to see new ways to deploy digital POP displays in the near future. POS: The POS is no longer limited to the register and checkout counter. Now, mobile (mPOS), ecommerce, and omnichannel have extended the POS’s footprint—the sale can take place just about anywhere. Online, many POS systems have integrated payment options for various credit/debit cards, mobile wallets, digital currency, gift cards, subscriptions, payment installments, and more. The Role of Point of Purchase in Retail Sales In retail, the POP plays a few roles. It’s meant to capture the attention of customers, educate them about your product or offerings, and encourage them to make a purchase. POP displays can also emphasize branding and contribute to the customer experience. Lego and Wonderful Pistachios both have recognizable aisle POP displays. Source: System Design Studio (L) and Fixtures Close Up (R) POP displays are strategically placed and typically promote “nice-to-have” items or impulse buys. For example, if you ever walk into a Marshalls or TJMaxx, you’ll see the POP displays by the registers full of small, tempting items that are easy to pick up and add to your cart. Most people don’t visit stores specifically for the POP display items but many walk out having purchased one. POP displays are an easy way to increase average order value (AOV) or move aging stock. They also give you an opportunity to test new ideas. For example, you can roll out a POP display in a single store to see if it’s effective before investing in rolling it out in all your locations. Tips for Creating POP Displays That Stand Out You want your POP displays to educate buyers and inspire them to make a purchase. Here are some tips to keep in mind when building your POP displays: Choose highly trafficked areas of your store. Use a foot traffic analysis tool to understand how shoppers move through your space, including where they spend the most time. Target areas with high dwell time to increase POP engagement and sales. Promote small or seasonal items. POP displays can promote almost any product, but impulse buys or small necessities (e.g., batteries or hand sanitizer) are the most common items. Try new tools and technologies. In-store POPs are evolving far beyond cardboard cut-outs and signs. Now, retailers can get detailed insights into how shoppers move through their store and target in-store customers on mobile devices using Bluetooth technology. You can even create your own mobile app—one report found that mobile app adopters make more purchases. Analyze and optimize your POP displays. Using the data from your POS system, you can see how well your POP displays perform. Make adjustments based on these insights to improve performance. Optimizing the Point of Sale to Drive Additional Purchases Let’s start with the traditional take on the POS: the checkout counter. Every customer that ends up in the checkout area will have encountered your products at the POP or POS displays. Take advantage of that opportunity by making the checkout process simple and enjoyable for customers. Vocal Promotion In addition to physical displays, associates can talk to customers about popular products or promotions. Keep in mind that pushy promotional scripts or tactics often put off customers. Stress-Free Transactions The POS should be a quick, simple, and stress-free experience. With an advanced POS and well-trained staff, you can speed up the checkout process. Plus, mPOS options give associates the chance to meet customers where they’re at—on the floor. This means no waiting in line and fewer reasons to reconsider the purchase. Personalized Shopper Recommendations You can also use the POS to get to know your customers and offer personalized recommendations based on their information and behavior. POS technology allows for customer relationship management (CRM), loyalty programs, gift cards, discount codes, and other promotional options to drive more sales. Self-Checkout In some scenarios, like grocery stores, POS technology allows shoppers to self-serve. Customers who might not be feeling social or who might feel self-conscious about their purchase are more likely to add more to their cart if they have a self-checkout option. How POS Systems Connect the Point of Purchase and Point of Sale To keep up with customers’ expectations and how quickly retail is changing, all of your systems have to work together. Businesses increasingly need their tech systems to “talk” to each other. That means choosing integrated systems or connecting them with custom API solutions. If you’re wondering how to use a POS system to analyze and optimize both your POP and POS, there are a few key features and capabilities to look for: Inventory Management Most POS systems have some inventory features. Many allow you to create and manage SKU numbers, bar codes, product categories, supplier profiles, shipping labels, and other important product information. Many POS systems will also track stock levels across all of your commerce channels. This brings together your POS and POP displays by syncing inventory levels and alerting you when there’s an issue, like if an item is selling out quickly or not selling fast enough, giving you enough leeway to adjust. Selling out: You’ll either want to reorder quickly (some POS software can do this automatically) or add some sort of messaging that the items are selling out soon. Not selling: You might consider adding those items to the POS and POP displays or encouraging employees to promote them. Customer Relationship Management (CRM) With your POS system, you can collect customer information with every interaction. You might get customer names, phone numbers, ZIP codes, or email addresses and add that to the POS system—the perfect information for loyalty programs, birthday gifts, and more. Your POS system will also track customers’ purchase history, including how much they spend, what they buy, which payment methods they’ve used, which location they’ve shopped, and if and when items were returned, among other behaviors. You can use these insights to create your POS and POP strategies. Segment your customers based on similar behavior and create displays based on your most valuable segments. For your online store, this helps you create insight-driven, targeted digital marketing initiatives. Reporting POS systems break down sales data in detail—noting exactly when items are purchased and who made the sale, among other information. Advanced POS systems also drill down into where the purchase decision was made. Reporting data from your POS system can tell you many things, including: Which items are popular from POP displays Which POP displays are most effective When and where customers make the purchase decision, the actual POP Sales upticks or drops in relation to POP displays Which employees are responsible for the most sales How quickly products sell when in a POP display vs not in a POP display Which displays shoppers interact with most Omnichannel Today, customers have so many touchpoints with businesses. And even though they may be interacting with you on a multitude of channels at different times and days, it’s important to always provide the same level of service and the same experience regardless of where or how you’re engaging with the customer. Your POP and POS come into play here because they can help create that seamless experience in your permanent store, at events and pop-ups, on social media, via email, and on your online store. Shoppers expect their entire experience to be seamless. Transparency, data security, multiple payment options, and a good user experience are musts for small businesses. Recent research found that 18% of US online shoppers have abandoned an order in the past quarter due to a lengthy or complicated checkout process, and 17% abandoned because they didn’t trust the site with their credit card information. This is especially important because consumers no longer take a linear path to purchase. There are many research channels and other touchpoints that happen in a nonlinear fashion before a customer feels compelled to make a purchase. New technologies integrate various business tools and systems to centralize data and provide well-rounded analyses about your POP and POS. Bottom Line The POP and POS are two key drivers in every retail store and can improve the customer experience and sales for your business when used effectively. It’s important to understand how they compare so that you can leverage the power of both to optimize your retail business. Learn how to get more from your POS with the resources below. POS Trends & Technologies Shaping the Future of Retail Benefits of Using a POS System Top POS Marketing Ideas to Maximize Sales Shopping Cart Abandonment Statistics 14 Visual Merchandising Techniques

is a browser- and app-based delivery management system for small to enterprise-level restaurant, retail, and courier businesses. Starting at 29 cents per delivery, GetSwift offers real-time managing, dispatching, and tracking capabilities. It integrates with several point-of-sale (POS) systems, and you can build additional integrations via the platform’s open API. When to Use GetSwift GetSwift is designed to help small operations grow and scale their businesses. The user-friendly dashboard and driver app lets you connect to your customers with a clean and professional-looking system. In particular, we recommend GetSwift for: Shops and restaurants that manage in-house drivers: GetSwift’s robust and affordable plan makes it a perfect fit for small stores and restaurants. It’s one of our favorite delivery software for restaurants. Businesses that use various delivery methods: GetSwift’s user-friendly system tracks couriers who deliver by truck, car, bike, and foot, or via public transportation. Businesses with varying delivery demands: GetSwift is a credit-based, pay-as-you-go system. So, if you have a month with no deliveries, you will not be penalized and will keep your remaining balance. Delivery operations that need fleet management: You can direct multiple fleets of drivers or couriers who operate out of different stores from your GetSwift dashboard at no additional cost. When to Use a GetSwift Alternative Businesses that need free delivery management software: GetSwift has affordable pricing and a 30-day free trial—but it’s not free. If you need a free tool, check out . Businesses that need barcode scanning with delivery management: Businesses that need barcode scanning to manage deliveries and products should look into . Restaurants that want a POS with built-in delivery management: GetSwift integrates with a few POS systems, but if you want a restaurant POS system with built-in delivery management, try . GetSwift Overview GetSwift Pricing GetSwift offers two subscription levels: Professional and Enterprise. You have to reach out for custom pricing, though plans start at 29 cents per delivery plus your custom quote. The Professional level subscription costs 29 cents per delivery and comes with a driver app, unlimited users and jobs, automated dispatching, route optimization, real-time tracking, and proof of delivery tools. You also get live ETAs, unlimited integrations, driver incentives, and customer feedback tools. Higher-volume businesses can get an Enterprise membership with a custom quote from the GetSwift sales team. Enterprise membership comes with all of the Professional-level tools plus priority customer service and custom-built integrations. There are no setup fees or long-term contracts, and you can cancel at any time. Another nice feature for small businesses: If you don’t make any deliveries for a month, you won’t be penalized or charged. Your balance will remain the same, and you can use your credits when you’re ready. GetSwift also has a 30-day free trial. GetSwift Features GetSwift offers more features in its lower-tiered plan than other platforms. The baseline subscription gives you unlimited users and delivery tickets, automated dispatching, route optimization, driver tracking, proof of delivery, and more. We’ll cover key features like delivery below, but some of GetSwift’s additional standout features include: Free trial: If you want to test the platform before you commit, GetSwift gives you a 30-day free trial period for 250+ orders. Pay-as-you-go pricing: To pay for GetSwift, you add credits to your account. Your credits deplete as you use the service. Once your balance gets low, they’ll send you an alert. The credits never expire, so you won’t be charged if you have a month with no deliveries. Cash management: GetSwift allows you to track cash payments from your dashboard. At the end of a shift, you can settle up with your delivery team. Comprehensive online tutorials: GetSwift offers extensive online training resources for merchants and drivers to help you get up and running. The step-by-step tutorials are helpful and easy to follow. You can also submit a support ticket if you need additional assistance. GetSwift Integrations GetSwift integrates with online ordering and ecommerce platforms and several POS systems like Clover and Square. GetSwift restaurant integrations include: Clorder Eat24 EatNow Foodkit GloriaFood GrubHub JustEat Menulog Menuu Mobi2go OrdersIn GetSwift’s retail integrations include: BigCommerce Magento Shopify Squarespace Wix WooCommerce WordPress In addition to the retail and restaurant platforms, you can also integrate Trello, Google Sheets, JotForm, TypeForm, and Zapier. GetSwift Delivery Management Customer alerts: Send live tracking maps, ETAs, and SMS message updates to customers. Manual or automated dispatch settings: Choose the settings that make the most sense for your business and drivers. You can limit the dispatching radius and cap the number of tasks a driver can accept. Delivery confirmation: Drivers are required to collect a customer signature and attach an image, which is sent to the customer directly after the delivery. This improves the customer experience and mitigates issues like missing items or chargebacks. Manage fleets: If you operate multiple brick-and-mortar spaces, you can supervise and dispatch fleets from several locations and stores directly from the GetSwift dashboard. You can manually upload orders, upload a spreadsheet, or use the automatic integration from your compatible online ordering system or POS. GetSwift will send the orders to whichever dispatched drivers are most available from both a location and capacity standpoint. If you have the resources, you can also build on the API for your own custom tools. The dashboard tracks all current and future orders in real time so your team can see everything that’s going on. The reporting suite captures your daily data, providing details about every order, including average delivery time, location statistics, and driver performance. You can analyze the information via the dashboard or export the data to another platform. GetSwift also has proof-of-delivery features. You can choose for all handlers to gather a signature or photo or take notes to help alleviate any issues. Once the delivery is complete, your customer will receive notice of delivery with the selected options. GetSwift Driver Management Smartphone driver app: The driver app alerts drivers to new orders and provides directions with the most efficient route. Real-time tracking: GetSwift’s dashboard shows up-to-the-minute drivers’ locations. There are even alerts for when a driver is running late so you can proactively manage issues. Messaging: Automated, hands-free SMS messaging keeps the drivers and customers in close communication during delivery. If needed, the driver and customer can communicate with one another directly through the app. Driver route optimization: GetSwift uses a routing algorithm to evaluate and select the most efficient routes. This feature lowers fuel costs and delivery times. Vehicle variety: Manage couriers traveling via truck, car, scooter, bike, or foot. Cash payments: Track any cash payments from your dashboard. You can also offer cash bonuses, float cash, or settle up at the end of a driver’s shift. The free GetSwift app allows drivers to manage their daily schedule, track completed orders, and customize their personal account page. If your business takes cash payments, drivers can use the digital cash register and track transactions directly through the app. The user-friendly app has the resources and information necessary to complete deliveries promptly. GetSwift also owns Scheduling+, which is fully integrated to handle driver scheduling and payroll. This feature is free for Enterprise subscribers and $4/user for Professional memberships. Drivers enter their availability so you can schedule shifts accordingly. Drivers can also clock in and out, and you can adjust the pay rates for each driver. You can even prevent staff from going into overtime by setting up alerts for when they’re within a range of hours. To make payroll easier, you can export your data to major payroll providers. GetSwift Customer Management Real-time delivery tracking maps: Enable customers to track their driver in real time. White-label branding services: GetSwift manages all deliveries from the back end, which allows your branding to be the focal point. SMS text messaging: Automated messages and updates are sent directly to the customers. Customer feedback: Customers can receive feedback forms via SMS messaging. Information on GetSwift’s customer management tools is slightly limited in comparison to its competitors (like lack of driver ratings and order archives). However, GetSwift does provide a white-label customer experience. Your customers will receive live updates throughout the order, including a branded live tracking map that provides ETA updates via SMS, email, or webhooks. Additionally, you can enable GetSwift to automatically send proof of delivery directly to the customer with a signature, image, and any notes regarding the transaction. To receive customer feedback, you can send forms to all or a selection of customers through messaging. The responses are stored in your dashboard, which allows you to assess the information and improve your operations. GetSwift Ease of Use Online resources: Detailed videos and tutorial guides for merchants and drivers are available on GetSwift’s website. Accessible API codes: Easily locate API codes to build custom integrations. 24/7 customer service: Reach customer service anytime via chat or email. Multiple language support: The driver app is available in four different languages. The GetSwift platform aims to be simple and easy to use. The dashboard allows you to manage your entire delivery enterprise from one screen and is organized and easy to read. The main navigation page lets you see all available drivers, jobs, and the data snapshot of deliveries, average delivery time, and cancellations. To add additional integrations, GetSwift provides you with detailed API codes via their website. For custom integrations, you must subscribe to the Enterprise plan. Most small business owners may need to work with an IT specialist to ensure the coding is correct. Driver App Ease of Use Drivers can download the free GetSwift driver app from Google Play and App Store. They can choose to operate their app in four languages (English, Spanish, Arabic, or Portuguese). The driver app is easy to use and includes a live algorithm that finds the most efficient driving route. If you need more support, GetSwift offers detailed step-by-step instructions and video tutorials to teach drivers how to use the interface. GetSwift Customer Support GetSwift’s customer support team is available 24/7 via web chat and email. The website contains a comprehensive support guide for both merchants and drivers, complete with videos and step-by-step instructions to help troubleshoot any issues. If you need additional support, you can submit a support ticket through your customer account. You can track the status of the tickets from the portal as well. GetSwift Alternatives What Users Think of GetSwift The GetSwift platform is generally well-reviewed. Small business owners note the system's simplicity, tracking accuracy for delivery and drivers, and affordable pricing. Capterra: GetSwift earned a rating of 3.7 stars based on 13 user reviews. G2: Only two reviewers comment on G2, giving GetSwift 5 out of 5 stars. Software Advice: Reviewers have mixed feelings, with 12 users weighing in with an average 3.58 out of 5 stars. Apple App Store: Drivers gave the GetSwift software 3 out of 5 stars on average from 44 reviews. Google's Play store: Users rate the drivers’ app 3 out of 5 stars out of 314 reviews. Reviews from merchants and business owners are primarily positive and highlight the automated customer messaging and easiness of the system. Most criticisms include suggestions on software improvements and customer service assistance. However, quite a few drivers seem to have issues with the app. Reviews note the system bugs with crashing, location issues, and phone compatibility. Bottom Line GetSwift is a robust delivery management software system for small businesses. The pay-as-you-go pricing format is an excellent way for stores and restaurants to control their costs. With a customizable interface, GetSwift looks and feels like a more extensive operation. Through real-time driver tracking, fleet management, and several online ordering integrations, GetSwift can also support higher-volume courier, retail, or restaurant businesses. To see if GetSwift is right for your business, visit the GetSwift website for a 30-day free trial.

Imonggo is a straightforward POS system for small shops that need strong inventory tools and a points-based loyalty program. It doesn’t offer as many features as the software on our best POS systems list, but it’s easy to use and has international sales features. It integrates with Shopify or offers a simple online store for free that syncs with Imonggo’s in-store app. It has a limited free plan, but at $30 a month for the full plan and unlimited use, it’s a bargain compared to most systems we look at. When to Use Imonggo I’ve reviewed dozens of POS systems, and I like Imonggo’s straightforward approach. It comes off as a simple software, but as I dug in, I found a lot under the hood. Nonetheless, most of the top-rated POS systems offer more—even Square, which is free with its flat-rate payment processor. Imonggo is constantly improving and adding features, however. We recommend it for: Mom-and-pop stores wanting a low-cost solution: Imonggo is inexpensive and simple to use. In fact, it makes our list of the best free POS systems. Mom-and-pop stores or small shops may find it meets their needs (such as upgrading from a cash register) without adding a lot of extraneous features or bells and whistles. Tourist shops or stores with international clientele: While the software is only available in English, Imonggo can work with multiple currencies and tax systems and even has a space for tracking customer nationalities, which are very rare features. When to Use an Alternative Stores wanting employee tools: Imonggo can track sales commissions, but it does not have time tracking, pay, or tips tools to help with payroll, plus it doesn't do scheduling. If you need time tracking and payroll management, try . Restaurants: While you can sell food with Imonggo, it does not have table management, reservations, or kitchen display functions. Check out our best POS software for restaurants for better choices. Stores wanting a mobile app: Imonggo is working on a mobile application, but other than the iPad download, it’s not there yet. Instead, check out our list of the best mobile POS systems for Android or iOS, which includes systems like Square and Lightspeed. Growing retail businesses: You will likely need more power than Imonggo can offer. We like for storefront operations, but offers the best solution for multichannel selling. Convenience and liquor stores: You’ll want specialized features to handle things like age verification as well as bottle tracking. See our picks for the best convenience POS systems and best POS systems for liquor stores. POS Nation, KORONA, and IT Retail make both lists. Imonggo Overview Imonggo Pricing Imonggo has simple pricing: Free for the limited plan or $30 per month, per branch, for the Premium plan. The free plan limits features and the number of users and does not come with live customer support. (You can, however, still access the knowledgebase.) The paid plan is about half the price of most POS systems we’ve evaluated. There’s also a 30-day free trial. Imonggo Hardware Imonggo does not sell POS hardware. It can work on an iPad, laptop, or desktop computer. You can use any receipt printer or even a regular office printer. It recommends the Dymo LabelWriter 450 for generating barcodes. Card readers come from your payment provider. Imonggo Features Imonggo is easy to set up and use. Sign up for a plan or free trial, put in your store information, and start adding your inventory. You can also add an online store, shipping information, customers, and more. Register & Checkout Imonggo is a browser-based POS system, meaning you can download it to your iPad or use it on a computer. It allows barcode scanning, or you can look up items by category. It processes discounts in general or by item; can accept split payments, gift cards, and different currencies; and prints receipts. Imonggo has layaway tools for handling deposits and partial payments, gift certificate processing, loyalty points management, and more. Imonggo’s latest version, Store V4, records sales even if you lose your internet connection, storing sales in the database to upload when the connection is restored, and looking up the information from the browser database as opposed to the cloud. It includes cash movements in the till, and a Z Reading feature that takes a snapshot of the transactions made on each store that you can use as an end-of-shift report for each cashier. Payment Processing Imonggo integrates with Worldpay (formerly Vantiv), Authorize.Net, Stripe, and PayPal for payment processing. According to Imonggo’s website, Stripe is used for subscriptions, while PayPal is the credit card alternative. Authorize.Net, PayPal, and Stripe all made our list of best payment gateways for 2021. Worldpay is not on our lists of recommended merchant services. It does not post its rates online but does require a three-year contract with early termination fees and other charges like a PCI compliance fee. You will need to integrate—and in some cases, contract—with these providers for payment processing. If you prefer a free POS system with built-in credit card processing at no obligation, consider Square. Ecommerce Imonggo offers two ways to sell items online. First, you can create your own online store for free via Imonggo. It will automatically sync your inventory and create a simple store you can customize with your logo. You can set up locations, currencies, and zones for international sales. You can promote your store with a QR code that you can download and use on your website, marketing materials, or elsewhere. If you have more complex ecommerce needs, you can also integrate Imonggo with Shopify so that you can sell items there and in your store, and inventory amounts will reflect in real time. Inventory Imonggo inventory keeps track of your products whether you sell them online, in-store, or both. On the back end, you create products with names, stock numbers, descriptions, retail prices, barcodes, and images. By using tags, you can create categories. (Other POS software have category and subcategory fields, but using tags is not unusual.) You can set minimum and maximum quantities to be used in reports like low-stock alerts, including decimal quantities when selling items by weight or volume. You can allow cashiers to change prices, such as with a damaged item. There are also buttons to mark items as popular—a nice option for your website—and exempt items from taxes. You can also upload items in bulk via CSV file. Imonggo allows you to create kits, which have a unique inventory designator, and compositions, which record each individual item in that item’s inventory. Use kits for such things as gift baskets, while compositions are more like sandwiches or custom bicycles. From the Stockroom setting, you can acknowledge receipt of items from suppliers and add those items to the inventory. You can also record returns to suppliers, adjustments in or out, and physical count. If you have multiple stores, there are tools for transferring products as well. Unlike some POS systems, you need to create your own purchase orders when you run low on stock. You can designate employees to create purchase orders and have management edit and approve if you wish. Customer Loyalty Imonggo lets you track customer information, from name and birthdate to nationality, contact information, company information, and memberships. You can also mark a customer as tax-exempt, such as if they purchase for their nonprofit, and make notes. This information shows up in the customer tab. Once you have a customer put into the system, you can put them into groups. Groups are usually for memberships in loyalty programs, and thus let you assign point earnings and conversions. Imonggo does not have email marketing functions. For marketing, consider Lightspeed, Revel, or UpServe. Reports The Business Reports section is sparse compared to most POS systems. However, it does give you reports for gross and net sales, items sold, transaction history, top products, top sellers, payments and discounts, collected deposits, loyalty points, and other sales-related issues. It does not have employee reports like time sheets, tips that you’d need for payroll processing. If you are interested in this function, check out Square (which has an add-on) or Toast (for restaurants). The Z reading reports record transaction information like count, start/end dates on invoices, beginning/end amounts for the reporting period, sales quantity and amount, returns, discounts, payment types, layaways, and more. It’s a good report for end-of-shift accounting. Mobile Apps Aside from the Imonggo POS application for iPad, it has a sales dashboard for Android that lets you track daily, weekly, and monthly sales, transactions, and taxes. It’s working on an inventory app for viewing and adjusting your inventory. As of this writing, there were only a couple of reviews on Imonggo apps in either the Google or the Apple app stores. Imonggo Ease of Use Online tutorials Illustrated knowledgebase 24/7 live chat customer support (with the paid plan only) Imonggo has a clean interface that uses a lot of dialog boxes and typing information. The online tutorials are well-illustrated and take you step by step but are direct. You won’t find a lot of extra information or tips in the knowledgebase, but you will see how to get the primary functions done. Customer support is only available in the paid plan, but it is 24/7 via live chat. There is also an online chat where you may be able to get general questions answered as well. Imonggo puts out updates or improvements to its software every two to three months; it posts about the changes on the website, so it’s easy to know what’s new. This is great for those that want a product that’s constantly improving. Imonggo Alternatives If you’re not sure Imonggo is right for you, see how it compares with our top POS services. What Users Think of Imonggo There aren’t a lot of reviews of Imonggo on third-party review sites. Of those, all the users said the software was easy to use. One appreciated the offline feature, while others praised the inventory tracking and ability to switch between stores to see reports. Noted problems included an outdated design and lagging that resulted in entries getting recorded twice. TrustRadius: 8 out of 10 based on 1 review. G2: 3.5 out of 5 based on 2 reviews. Bottom Line is an easy-to-use POS system with international commerce capabilities and an online store. While not the most feature-rich POS program we’ve reviewed, it’s reasonably priced and has all the tools needed for a small shop. There’s a free plan that limits users, products, and transactions, but if you are just starting out, it could be a good choice. Sign up for the free plan or the 30-day free trial and see if Imonggo is right for your business.

A ghost kitchen is a food service business that prepares food for delivery only. Ghost kitchens—sometimes called cloud kitchens, virtual restaurants, or dark kitchens—can be free-standing commercial kitchens or operate as a “virtual brand” that shares kitchen space in a traditional, brick-and-mortar restaurant. Ghost kitchens tend to have a shorter development timeframe and lower upfront costs than full-service restaurants. Market research firm Euromonitor predicts that the global market for ghost kitchens will reach $1 trillion by 2030. Types of Ghost Kitchens Just as there are various types of restaurants, there are different types of ghost kitchens. Businesses as diverse as food truck brands and massive national restaurant chains are experimenting with the ghost format. Each brings unique ideas to the virtual restaurant concept. Ghost kitchens tend to fall into three major categories: The ghost kitchen concept is still actively evolving, so these categories are not set in stone. Some ghost operations blend aspects of all three kitchen types. And while most ghost kitchens sell their food exclusively on third-party delivery platforms like and , others opt to deliver their food themselves. Ghost kitchens are not a new phenomenon; they emerged during the late 2010s when third-party delivery companies became popular. Early ghost concepts were launched by large restaurant chains that hoped to meet consumer demand for delivery without overwhelming their busy restaurant kitchens. Those ghost kitchens tended to be freestanding commercial kitchens where large brands like The Halal Guys routed all their delivery and to-go orders. As the COVID-19 pandemic forced restaurants across the United States to close, ghost kitchens took off on a whole new level. Why Are Ghost Kitchens So Popular? Ghost kitchens are popular for two main reasons: they are less expensive to open than a traditional restaurant, and major companies are investing major dollars in them. Ever since the Euromonitor report announced that staggering $1 trillion market forecast, investment dollars have poured into ghost kitchen concepts. By the end of 2020, there were approximately 1,500 ghost kitchens in the United States. Considering that third-party delivery sales grew by 116% year-over-year, and C3 Kitchen claimed to have opened 200 ghost kitchens themselves, there could be hundreds more ghost concepts that figure failed to count. How Ghost Kitchens Make Money Like all restaurant businesses, ghost kitchens make money by closely managing their costs and profit margins; ghost kitchens just have slightly different costs to wrangle. For example, a ghost kitchen’s labor costs are lower than a traditional restaurant, but they have the added costs of delivery fees and take out containers to contend with. Depending on the style of online ordering and delivery a ghost kitchen chooses, the cost can vary from 15% to more than 30% of every order. To turn a profit, successful ghost concepts must: Attract a high volume of orders: Most ghost restaurants rely on the visibility boost that third-party platforms provide. Though some free-standing ghosts deploy an extensive social media marketing strategy instead of paying commission fees. The desire to attract orders is why comfort food (such as crispy chicken, pizza, and burgers) appears on many ghost menus. Price their menus competitively: Customers pay delivery fees for ghost kitchen food, so a menu that is priced too high can give customers sticker shock. Count their costs correctly: In addition to rent, the cost of food, and delivery fees, ghost kitchens need to budget for takeout supplies and storage space. Marketing tends to be a bigger expense when your business cannot rely on foot traffic. And while ghost restaurants have smaller staffs than traditional restaurants, they still have some labor and payroll costs to manage. Ghost Kitchen Pros and Cons There are a lot of benefits to opening a ghost kitchen versus a traditional restaurant. The most attractive reason to open a ghost kitchen versus a traditional restaurant is the lower upfront cost. Ghost kitchen platform CloudKitchens claims the upfront investment is around $30,000. Compare that to the $100,000 to $2M that it costs to open a full-service restaurant, and it's easy to see why restaurant owners are excited. Other pros of opening a ghost kitchen include: Shorter opening timeline: Whether you work with a commercial kitchen platform or rent existing restaurant space, your ghost kitchen typically has all the equipment you need to get started. Lower tech costs: Third-party delivery platforms provide you with tablets to receive incoming orders and handle all the online payments. So if you use third-party platforms exclusively, you might not even need a point of sale system (POS). Fewer required permits: Ghost kitchens only need the bare minimum of restaurant permits. You’ll need to file for basic restaurant permits like tax ID numbers and health department licenses. But ghost kitchens don’t need all the building permits and liquor licenses that full-service restaurants do. Smaller staff: In the face of rising labor shortages and the prospect of a higher minimum wage, the small staff required to run a ghost kitchen is incredibly appealing. Menu flexibility: Since your ghost brand is virtual, you can change your menu, pricing, or name at any time. Or add a side menu for a new concept from the same kitchen. Lower risk: Traditional restaurant leases and software subscriptions ask you to commit for three to 10 years. If your business goes bust, you’re still on the hook. Ghost kitchen terms are much shorter, sometimes even month-to-month. Of course, there are cons to ghost kitchen ownership, as well. They include: Marketing challenges: Ghost kitchens need to hustle to put their business in front of customers. Buying marketing packages on third-party platforms or investing in social media marketing will take time and money. High commission fees: Third-party platforms charge between 15% and 30% on every order. That can add up quickly. But you can sidestep these by offering pickup or creating an in-house system for online ordering and delivery. Increased payment processing fees: If you choose to handle ordering and delivery in-house, you’ll likely pay higher processing fees for online credit card payments since they are more prone to fraud. No sales boost from alcohol: Most new ghost kitchens don’t have liquor licenses. And even if you have one, many cities restrict alcohol delivery. Lack of customer data: Third-party platforms do not share your customer data. The only way to pitch promotions and deals to drive future orders may be to purchase pricey marketing packages from your delivery platform. No direct customer interaction: Many restaurateurs gain energy from seeing happy customers enjoying their food. Beyond the interpersonal interactions, however, ghost kitchens lose some control over their customers’ experience. For example, if you work with third-party platforms, you won’t even control when a customer receives a refund. Not ideal for rural locations: Ghost kitchens need a high volume of orders to be profitable. Rural areas may lack the customer base to support a ghost operation. Ghost Kitchen Outlook So, are ghost kitchens the future of restaurants? Well, they’ll definitely be a part of it. The same report that forecast $1 trillion in ghost kitchen sales by 2030 projects that ghost kitchens will account for 50% of worldwide takeaway food service. Additional research from the National Restaurant Association found that 77% of adults plan to order takeout or delivery in the coming months. And from January to December 2020, 33% to 52% of consumers said that they weren’t ordering takeout or delivery as often as they’d like. So there is a lot of pent-up demand, especially for independent restaurant concepts; 64% of diners prefer to order delivery directly from a restaurant rather than a third-party platform. However, new ghost kitchen operators should also be aware of some risks. For example, that same National Restaurant Association study found that 72% of adults feel it is important to order delivery from restaurants they can visit in person. And some market analysts expect ghost kitchens to be even more competitive than traditional restaurants, estimating that up to 80% of the ghost brands will fail. The most sustainable future for ghost kitchens may be institutional settings like college campuses and airports. Large-scale hospitality operations like hotel chains and co-working spaces are also promising prospects. Bottom Line Whether you call them dark kitchens, cloud kitchens, or virtual brands, ghost kitchens are an exciting opportunity for small restaurants to test new concepts and expand to new markets. Ghost kitchens also provide a low-cost way for new restaurant businesses to get off the ground. If you hope to open a ghost concept, you should take note of the risks, however. The market is expanding rapidly, which can lead to inflated lease prices and increased competition. But if you control your costs and actively market your brand, you’ll be well on your way to running a profitable ghost restaurant. You May Also Like... See our recommendations for the best online ordering systems for restaurants Choose a delivery software or POS system with integrated delivery management for your ghost kitchen

Leasing a commercial property for your restaurant allows you to get your business off the ground without buying a building. Restaurant leases typically run from five to 10 years and may include a series of industry-specific clauses. Onerous restaurant leases are a common cause of restaurant closures, so it is important to get the most favorable terms when you are renting a restaurant space. A restaurant lease is a long-term, binding contract. You will absolutely need an attorney to review letters of intent and draft lease clauses. You don’t have to break the bank to find one. The Business Advisory Plan offered by legal services site LegalZoom is priced at $36 per month and gives you access to local business attorneys who can advise you on everything from your lease to your business structure. You can visit LegalZoom for more information. Your restaurant location will be the single most impactful decision you make when you are starting a restaurant. Some restaurant owners choose to buy a space when they find a good one, but the cost of buying commercial property can be prohibitively high for small restaurants. You can lease restaurant space at a much lower upfront cost. Leases allow your restaurant the flexibility to move if the location isn’t right. Leasing typically saves you money you would otherwise spend on property taxes as well. It's easier to move or close your business if you're tired of running a restaurant at the end of your lease . If you decide to go with a commercial lease you want to consider the remaining steps we discuss below. Many unique phrases pop up in the course of discussing commercial leases in general. Our article How to Lease Commercial Real Estate: The Ultimate Guide contains a comprehensive list of them. Restaurant renting, however, has specific language that can be quite different from a traditional retail or office rental situation. It is important to understand these before negotiating a restaurant lease. Start date of rent: Many restaurant landlords will waive restaurant renting payments during your restaurant build-out. Typically you can get 60 to 90 days, or until you open for business, whichever comes first. Liquidated damages: If a landlord’s failure to make repairs delays your restaurant opening, they may owe you for your time and lost revenue. Liquor license contingency: If part of your restaurant business is tied to your ability to obtain licenses like a liquor license, you can note this in your lease. Then, if you are not approved for the necessary license, you can get out of the lease. Kick-Out Clause: This language allows you to terminate the lease if your gross sales fail to meet a pre-negotiated dollar amount by a set time. Sub-Lease Agreement: The ability to sub-lease to another tenant is useful. If your restaurant is struggling, you can find another business to take over the space from you. Exclusive use: If you are located in a shopping center or mall location, an exclusive use clause prevents the landlord from placing a similar tenant near your restaurant. Kiosk/ Food truck protection: Another concern for restaurants in shopping centers is direct competition from kiosks or food trucks. This is similar to the exclusive use clause, but directs language toward food trucks or kiosks being parked within a certain distance from your restaurant. In addition to these terms, there are two major factors that you should know about before ending a conversation about restaurant leases. Clauses like burn-offs and percentage rent are common in most restaurant leases. They both have a lot of ins-and-outs to consider, so let’s explore them in more depth. Burn-Off Clauses Restaurants—especially new ones—are widely considered to be a risky investment. That can make a property owner skittish about renting to a restaurant. So commercial landlords tend to request large security deposits or personal guarantees from you and any principal business partners. While this protects the landlord from your restaurant defaulting on the lease, it can increase your costs and negate any work you have done to separate your personal assets from your business. Most restaurant leases split the difference by adding “burn-off” clauses to protect the landlord from defaults while limiting your personal obligations to a certain timeframe. For example, a Security Deposit Burn-off clause requires your landlord to return a portion of your security deposit after your restaurant has been a tenant in good standing for a certain amount of time, or when your restaurant reaches an agreed upon level of sales. A Personal Guarantee Burn-off clause rolls back any personal guarantees that the original lease required of you or your business partners. A typical Personal Guarantee Burn-off clause terminates the personal guarantee after your restaurant has paid rent without defaulting for three years. Percentage Rent This term is the most important to understand. Most restaurant leases include language that entitles your landlord to a percentage of your “gross sales” as part of your monthly rent. The usual request is for 7% of your gross sales after you pass a set sales amount, ( $100,000, for example). These clauses are pretty universal, and nearly impossible to avoid. You and your attorney should still try to get it removed. If you can’t remove it, you should negotiate this clause heavily. The importance of negotiating the percentage rent of a restaurant lease cannot be overstated. Sharing your sales information directly with your landlord (as a percentage rent clause essentially requires you do) will make it more difficult to negotiate favorable terms when it comes time to renew your lease. There is a reason that so many restaurants close at the five and 10 year points. These are typical times for rent re-negotiations. Most percentage rent negotiations focus on the definition of the term “gross sales.” It may seem like a straightforward term, but there are ways to refine it: Subtract credit card processing fees: Restaurants pay 3-5% of most credit card transactions to payment processors and often never see these fees hit their bank account. This should be a straightforward adjustment to make. Ensure that refunds and discounts are excluded: Sales that were discounted or refunded should not be counted toward your gross revenue. Offer a dining discount: Offering your landlord and their property managers a dining discount is a gesture of goodwill. Combined with the strategy above, it can also help decrease the definition of your gross revenue. Tips and gratuities: Any tips or gratuities paid to your employees should stay out of your gross revenue calculations. Sales of furniture or equipment: If you sell some equipment that you don’t need—like an espresso machine or a load of glasses—these funds should not be counted as revenue. Depending on your location, restaurant style, and attorney’s abilities you may find other ways to further define what should and shouldn’t be included in the gross revenue figure that is used to determine your percentage rent figure. There are three types of restaurant lease brokers: leasing agents, tenant brokers, and dual brokers. A leasing agent represents the property owner, or landlord, of a commercial building. He or she earns a commission based on the units they rent to businesses. Tenant brokers represent you in your search for the perfect restaurant location. Some states allow a third type of broker, a dual broker. A dual broker is a neutral broker who helps you and the landlord navigate the lease negotiation. The best strategy for finding a lease that is favorable to your restaurant’s interests is to work with a tenant broker. You will have to pay their fees, but a tenant broker can translate lease conversations into plain language for you, and will offer you advice and guidance. Since leasing agents represent the landlord’s interests, they cannot recommend terms that would be more favorable to you. Dual brokers must remain neutral and cannot advise you directly, either. In most cases, you can find a local tenant broker by doing an internet search for your location and the phrase “commercial real estate tenant broker.” A local broker will have local knowledge of good locations, and may have also negotiated leases with your prospective landlord on previous occasions. Sometimes, especially in small markets, you may not be able to find a tenants’ broker. In this case, a business attorney is even more valuable. If you can find one that handles a lot of restaurant business clients, even better. You can search legal service websites like LegalZoom and IncFile, or ask other restaurant owners in your area for recommendations. Restaurant leases are 20 to 40 pages long. Unlike residential leases, commercial landlords are under no obligation to phrase them in conversational language that is easy to understand. The best strategy for securing a favorable commercial lease is to work with a business attorney. Any money that you spend on an attorney now will save you money and headaches in the future. If your restaurant and operating budget are small, look for an attorney that will work with you on an hourly fee basis. Small restaurants that are owned by women, people of color, recent immigrants, or veterans may be able to find business attorneys via local legal aid organizations or law schools. You can find such resources in your area by checking the  website. You can also find a local attorney through asking fellow restaurant owners for recommendations. Legal services websites like LegalZoom and IncFile also maintain databases of attorneys that you can search by location and specialty. Defining your restaurant’s needs before you begin looking at spaces will help you and your broker move quickly when considering different spaces. Your specific needs will vary based on your restaurant type. There are some general features to consider when comparing restaurant spaces to rent: Square footage: Typically, the larger your square footage, the higher the rent will be. Also, a bigger location means your sales will need to be higher, since heating, cooling and other costs will also be more expensive. Determine the size you need, and stick to it. Use-ratios: Depending on your restaurant type, you will need varying amounts of space for your staff and your customers. Most full-service restaurants use 30-40% of their square footage for the kitchen, and 60-70% for dining space. Parking: If customers can’t park easily near your restaurant, they won’t dine with you. Make sure the space you are leasing comes with a designated parking area, or room for a valet stand. Drive-thru: Especially in the age of social distancing, drive-thru windows are priceless. If your concept needs drive-thru capabilities, ensure that the space has enough space to add one. Ventilation: This is a major consideration for your cooking equipment, fire safety plans, and for maintaining a sanitary environment for your customers and employees. If you have wood burning ovens or smoke-producing equipment, ventilation is doubly important. Entrances and exits: A best practice is to have separate entrances for your customers and employees. If you are considering space in a shopping center or mixed use building, you’ll also want to inquire about loading docks for suppliers and location of dumpsters for garbage disposal. Create a list of features that your restaurant must have versus features that are simply nice to have. For example, a pizzeria must have a pizza oven (and the necessary ventilation for one). If you are developing a zero-waste restaurant concept, a designated place for recycling and composting materials would be a must-have. In either scenario, a horseshoe bar with track-lit cabinets might just be nice to have, though not necessary. Defining your needs can also create opportunities for flexibility. Depending on how far you have developed your restaurant concept, you may prefer to re-conceptualize your business based on an available space. For example, suppose you find a great location with favorable lease terms and a flexible landlord, but it is 80% kitchen and only 20% dining room space. It might be worthwhile to re-conceptualize your full service pan-Latin restaurant as a quick-service, grab-and-go concept. Renovations are common in restaurant spaces. The commercial property you are leasing may already be outfitted with a commercial kitchen. Or you may be the first restaurant tenant and need to install the necessary equipment yourself. Depending on what type of modifications are needed, you or the property owner will be responsible for paying for them. It is important to think about the renovations you need now, as well as future modifications you may need. Capital Improvements Capital Improvements are repairs or renovations that will forever change the property and increase its market value. Typically landlords pay for all capital improvements because the landlord will benefit from them even after your tenancy expires. Examples of capital improvements would be replacing roofs or updating the building’s plumbing or electrical systems. Non-Capital Improvements Non-capital improvements are alterations to the space that are specific to your restaurant business. These are improvements that future tenants may not need or want. Non-capital improvements might be Italian glass light fixtures that compliment your Italian restaurant theme. New Construction Spaces In raw spaces, the landlord pays for any structural work that needs to be done. It is the landlord’s building after all. Water lines, electrical lines, and ventilation systems for the building fall under the landlord’s jurisdiction. Connecting your specific equipment, however, is usually at your expense. So, for example, the landlord covers the cost of installing main water lines, but you would pay to extend that water line to connect to your ice machine. Future Improvements You may have plans to expand or shift your operation during the terms of your lease. For example, you may plan to start your business as a straightforward deli operation, then expand to catering in the next few years. In this case, you would want to expand the prep area of your kitchen and possibly add a separate entrance to load out large orders on rolling carts. Make sure that the space will be able to grow with your business before you sign on the dotted line. A Note for Franchisees If you are opening a franchise of a larger restaurant, you may be required by the franchisor to open your restaurant on a certain date. Your franchise agreement may include penalties for delays. If this is the case, you need to ensure that any repairs your property owner is covering are tied to that same date or earlier. Your attorney should draft a clause in the lease agreement that ensures the property owner will be responsible for any penalties you incur due to their construction delays. A Letter of Intent (LOI) is a letter that is written before the signing of a lease that memorializes the terms you and the property owner have discussed. A LOI can be drafted by you, the property owner, or either of your attorneys. The wisest move is to have your attorney write the LOI. If negotiations fall through and you don’t continue with a lease agreement, the LOI could be considered legally binding in some places. Your attorney will ensure that your letter of intent is free of any binding language that could paint you into a corner. If the property owner (or their attorney) drafts the LOI, have your attorney look it over before you sign. If there is any language that you feel is unclear, or suggests that you have agreed to something that you do not agree to—such as paying for certain repairs, or future rent increases—let the property owner know in writing. Your tone doesn’t need to be harsh, but it is important to record your disagreement over the terms in writing. Remember, an LOI is part of the lease negotiation process. If there is anything about the LOI that you disagree with or understand differently, don’t sign it. Have your lawyer request adjustments. If the landlord gets impatient with you, remind yourself that it is better to lose a potential location than to be locked into an unfavorable restaurant lease. Bottom Line Leasing a restaurant space has many advantages over buying a location. Leases cost much less upfront and allow your restaurant to be more flexible. Commercial leases are more involved than residential ones and do not come with the same degree of consumer protections. Negotiating terms with the landlord is an expected part of the lease process. When you are pursuing a restaurant lease, it is imperative that you have an attorney on your side to negotiate favorable terms for your business. is the nation’s leading provider of online legal solutions. In addition to a searchable database of attorneys in your area, LegalZoom also offers a Business Advisory Plan for $36 per month. Visit LegalZoom to check out its full range of services.

You don’t have to have a uniform for your restaurant staff, but uniforms offer some advantages. First, they enable you to ensure your employees are wearing clothing appropriate for work. Second, they help promote your restaurant’s atmosphere and brand. Finally, most diners and employees actually prefer them. Uniform vs Dress Code A dress code gives general guidelines and leaves the employee to choose the items. For example, you might get different shades of red T-shirts, black pants that vary from tights to black denim to flowing wide-leg slacks. Uniforms are ordered from a distributor either in bulk, or by piece by the employer. Employers often pay for uniforms or supply them and take the cost from the employee’s paycheck. The variety of uniform items you need will depend on the types of restaurant staff you employ. Different restaurants have different uniform needs. Here are 10 of the most common. 1. Pizza Shop Uniform Pizza shops (and other restaurants that have high takeout and delivery sales volumes) benefit from comfortable clothes that prominently display your brand. Branded uniforms help customers identify your staff, especially if they are delivery drivers arriving at a customer’s home. T-shirts or polo shirts in your company colors with logos on the back and front are a great fit for a place where workers need a lot of mobility. To control costs you can complete your uniform look with dress code requirements for pants and non-slip shoes. If you are located in an area that experiences cold weather, consider adding branded jackets for your delivery people. 2. Deli Uniforms Deli shop employees usually work both counter and food preparation, so the uniforms need to take that into account. Since you’re mostly dealing with sandwiches, chef attire isn’t needed, but full bib aprons are always a good idea. More important is a clean appearance that also adheres to kitchen safety. Headgear that keeps hair in check is a must, and you will need to provide gloves. For the rest, a branded T-shirt or polo shirt suffices, especially if you have a high turnover. 3. Cafe and Coffee Shop Uniforms Anyone who’s stood in line for their morning coffee knows that coffee shops can get as rushed as any restaurant. Therefore, it’s important that your employees have comfortable uniforms that let them move, especially in the narrow areas behind the counter. During a shift, an employee may work drive-thru, barista, and trash detail, so (as always) aprons and headgear are vital. What other elements you include will depend on the atmosphere you want to promote. If you have a staff of mostly students or otherwise experience high turnover, you’ll want to keep your costs down. 4. Food Truck Food trucks are the ultimate in casual eating, but just because the location is “dressed down,” doesn’t mean your staff needs to be. Choose uniforms that can stay neat under pressure, don’t wrinkle, and let your workers transition easily from serving to cooking. Most food truck uniforms are bright and memorable, featuring eye-catching logos or witty slogans. When placing your logos, be mindful of the height of the truck and the eye level of your customers. You want them to see your great designs and remember who you are. Many food trucks operate as micro-businesses. If you are concerned about meeting minimum order requirements with larger, traditional restaurant uniform companies, you can easily order small amounts of shirts, hats, and even jackets from . 5. Counter Service / Fast Food Most fast-food chains already have set uniforms, so if you are competing in that space, it’s a good idea to look to them for inspiration. In general, they have simple requirements for their general staff, with upgraded options for management. Uniforms reflect the brand in color and logo and are usually the same whether you are working kitchen or counter. While you want good quality, you should also budget for the wear and tear fast-food uniforms take. Even if departing workers return their uniforms to you, they may not be usable by another employee. 6. Full Service Casual Casual sit-down restaurants strive for return customers, so you want to be sure your uniforms, like your staff, reflect not just a welcoming atmosphere, but also the tone you wish to set. If you are going for a friendly atmosphere, consider T-shirts with slogans and catchphrases. If you are going for something more upscale but still casual, polos or button-downs add a little formality without getting too stuffy. Pick something that your employees feel comfortable in; Olive Garden, for example, changed its uniform from a white shirt and tie to a more comfortable but stylish black button-down after employees complained about the ties. 7. Full Service Upscale People expect more from upscale restaurants, not just in food and service, but also in atmosphere. Your uniforms should reflect that. They should be higher-quality fabrics, especially ones that clean well. Your wait staff may not wear hats (or even aprons), but if they do, it will be to convey style rather than function. Hosts may wear dresses, while hosts and bartenders wear vests or jackets. You may want to dictate the entire uniform, down to shoe style, in order to achieve a truly cohesive look. Darker colors are more sophisticated and hide stains. They are also great to pair with a contrasting color; though most upscale places stick to neutrals and blues. You may even want to consider custom fabrics. Contemporary uniform companies like Tilit NYC and CargoCrew offer sophisticated uniforms and varieties of fabrics and can work with you to create custom uniforms. 8. Fine Dining Restaurant If you have a high-end fine dining establishment that enforces a dress code for your customers, you probably want your staff to dress at the level of your diners or higher. Subtle logos and stylish uniforms that differ by roles can lend an air of sophistication to your staff. With every worker having a special role, you can vary uniforms by specific needs, but use color and style to tie them together. Consider having some extras, like clean chef jackets, stocked in your back office so your team always looks polished in your dining room. Many fine dining restaurants work directly with fashion designers to create styles that suit their brand. For example, the cutting-edge Chicago restaurant Alinea worked with the Zegna label to design their staff uniforms. This is a far more expensive option, but really gives your restaurant a one-of-a-kind look. 9. Seasonal Restaurant Seasonal restaurants are only open for part of the year, such as ski season, tourist season, or summer breaks. As such, the uniforms should take into account the weather, especially if your customers will dine outdoors. Many uniform suppliers, like , have shorts. Alternatively, you may opt for long-sleeved uniforms and fleece vests for waitstaff at a ski lodge. High staff and customer turnover can be a blessing to a seasonal restaurant, uniform-wise, because it gives you the opportunity to experiment with quirkier items that you might be able to get from retailers, like Hawaiian shirts. Remember health and safety needs when choosing this option. Use name tags, aprons, or headgear for your logo. 10. Bar Uniforms People often choose a bar for its atmosphere, so the uniform you choose should support the brand or the uniqueness of the location. Tiki bars favor bright colors or floral prints, while a sophisticated downtown bar may dress bartenders in white jackets. Regardless of the style you choose, be sure that bar uniforms are easy to move around in and washable. Vests paired with a pocketed half-apron are popular, classy, and protect against spills. How to Choose a Restaurant Uniform When deciding how to choose a restaurant uniform, first think about the features you want for your front of the house (dining) uniforms and back of the house (kitchen) uniforms. Consider your restaurant's specific needs around brand/look, head coverings, shirt comfort, non-slip shoes, and aprons. Front of the House VS Back of the House Uniforms Regardless of the type of restaurant you have, uniforms should be something your employees are comfortable wearing. That means keeping in mind body shape as well as sizes. While some restaurants, like Hooters, expect tight or provocative clothing, most restaurants default to modesty and sensible shoes. Here are some other important considerations. Work Environment: The materials should match the work environment. Cotton breathes easier, while some polyesters deflect water. Avoid nylon, which clings to the body and doesn’t ventilate. Offer short and long-sleeve options, especially if you air-condition heavily. Employee Tasks: Uniforms that are too restrictive can slow staff down, and uncomfortable fits make it hard to complete tasks that involve stretching or quick movements. Safety: When considering styles and fabrics, think about conditions like gas fire stoves or barbecue pits. Sturdy shoes with non-slip soles are a must BOH and for most of your staff FOH. Chefs might benefit from sleevies or long-sleeved jackets to protect against burns. Health requirements: Health codes require people handling food to wear headgear to keep their hair in check and gloves. Polyester has higher anti-microbial protection than cotton. Style: In addition to brand colors and obvious themes, think about where you sit on the scale of flamboyant to formal. Also, consider styles that look good on all kinds of people, especially if you are thinking about dresses for your female employees. Budget: Every employee should have at least two uniforms so that one can be in the wash at any time. Plan for spares. You can have common items, like aprons, that never leave the restaurant. In addition, think about replacement items and cleaning costs. Turnover rate: The more items you have in a uniform, the more likely they will be lost, forgotten for a shift, or taken when the employee leaves. If you have a high staff turnover this is a greater concern. It’s not necessary to have a complex uniform. For some restaurants, a single item like a T-shirt can keep your brand. Aprons are the easiest default, and you can keep them in the restaurant since they fit anyone. Do set some dress code rules to ensure safety and appropriate attire. How to Customize Your Uniforms Regardless of the types of uniforms you purchase, customizations can make them stand out as uniquely yours. In addition to style and color, here are ways to stand out: Custom-made Uniforms: You can work with designers, local tailors, or uniform companies about creating special designs that reflect your unique style. You can work with the company to design a fabric, or find a designer on and use a printed fabric site like  to have it made. Logos: If you don’t already have a clear logo that reflects your brand, create one. Then you can use the logo on custom fabrics, or have it silk-screened or embroidered on the uniform. To find a logo designer, check out our list of top logo design companies. Color Scheme: Color theory plays a role in restaurants too. Bright colors like yellow and orange are warm and friendly. Cooler colors like green signify health and make customers think of leafy greens. Red has been shown to encourage appetite, so it’s a good fallback for any restaurant uniform. Blue is an attractive color on pretty much anyone, but has been shown to have appetite suppressing effects. Branded Tools: Uniforms don’t just have to be what you wear. Branded items like wine keys, bar towels, coasters, or writing pads add to the atmosphere. Accessories: If you are on a budget, you can assign a strict dress code, then add an accessory to make your brand pop and add consistency. Hats, ties, bow ties, belts, or cummerbunds, can add a little flare. If you are going for a complete uniform, consider socks as well as shoes. Face Masks: What to Know The pandemic has caused a new accessory to come on the scene: face masks. Already, uniform companies are starting to create these, both to match their current uniform offerings or as custom-mades with your logo. When deciding on face masks for your team, consider the following: Comfort: Masks with ear loops can rub if they are the wrong size, so get adjustable ones. There are also ear savers you can get printed with your logo. Otherwise, look at the ones that tie instead, or the bandana or neck-gaiter styles. Fit: Masks need to fit well over the nose, usually with a piece of metal to allow adjusting. Otherwise, employees with glasses may have problems with fogging. Also, they should fit well over the face without gaps. Shielding vs breathability: Fabric masks are not 100% secure, but they are even less useful if your employees are constantly pulling them down or readjusting them to breathe more easily. Find masks that fit the face, but allow room within the mask for air. Branding: Just like you can get uniforms in branded fabrics, you can do the same with face masks. Print companies like and are making masks you can put your logo on. Restaurant Uniform Costs Uniforms can be costly or inexpensive, depending not just on the item, but also the style, fabrics, customizations, and more. Some high-end restaurants even hire famous designers to create their uniforms. In general, you can expect prices for individual items in these ranges: Full apron: $10 to $130 Half apron: $30 to $65 Chef coat: $17 to $125 Reusable Face Mask: $7 to $35 Polo shirt: $24-$70 Button-front shirt: $38-$90 T-shirt: $10-$25 With uniforms, however, individual item prices are not always the whole story. Many restaurant uniform companies require a minimum order of items, especially if you want custom-made or custom-embroidered uniforms. Depending on the item type, minimum orders can range from 12 to 100 pieces. Frequently Asked Questions (FAQs) Do I have to buy my employee uniforms? Some states, like California, Nevada, New Jersey, and New York, require that you provide and maintain uniforms. Others have no stipulations. If you purchase uniforms, they are considered a business expense. If you do not provide uniforms, consider your employees. If you hire a lot of teens or part-time workers, you may want to provide items or at least make them inexpensive. By law, the charge of the uniform cannot take an employee below minimum wage. Do I have to maintain uniforms? Employees should be responsible for washing uniforms. However, if uniforms need to be ironed, dry cleaned, or specially laundered (because of heavy stains or color concerns), you may want to maintain the uniforms yourself or give employees an allowance to do so. Can I charge employees for lost or damaged uniforms? You may, but as with charging for uniforms, be sure you understand your state laws. If you choose to charge for this, be sure employees are aware when being hired, and include it in the employee handbook. Be specific about uniform standards. Can I buy employee uniforms from a regular clothing store? You can, but consider that retail stores change styles and colors every season, making it hard to keep a consistent brand. Also, many uniform sales will offer wholesale prices, discounts, and will not discontinue your patterns if you choose special colors. Therefore, going to a regular clothing store might be a good choice for unbranded items or temporary uniforms. Some restaurants, however, will have their employees get pants from a regular clothing store, such as Dickies, so that they present a uniform appearance. Bottom line A good restaurant uniform, combined with a dress code, helps ensure your employees are dressed safely for the job, promotes your brand and atmosphere, and helps tie a team together. They can be as fancy as a complete outfit down to socks and shoes, or as simple as an apron with your logo. Think about the unique needs of your restaurant style in terms of working conditions, employee roles, how casual or formal a dining experience you want for your customers, and unique requirements like delivery, seasons, or employee base. Next, be sure you have a clean logo to use on your uniform. Finally, we recommend a uniform supplier rather than retail, as they can provide bulk pricing, save your designs, and keep you in stock.

Liquor license costs start at around $300 but can grow into the tens of thousands depending on your location. Processing times range from three to 12 months. State, county, and local licensing requirements vary widely. Business owners in large markets like New York and Los Angeles frequently use license brokers or permit expeditors to navigate the application process. Using permit expeditors is especially useful if you are starting a restaurant. If you are currently in the process of launching your restaurant, you may want to check out our free e-book “How to Start and Run Your Restaurant.” It combines the best advice from our in-house experts in finance, marketing, and hospitality. In this article, we show you how to get a liquor license in five steps. 1. Determine What Kind of Liquor License You Need Before applying for a liquor license, you'll need to identify exactly which types of licenses you will need. Exact requirements and prices vary slightly by state. Your state's Alcohol Beverage Control (ABC) board can tell you what your business needs to be properly licensed. It will be able to tell you which licenses you need and how much they will cost. While license types vary significantly among states, the type of license you'll need typically depends on your answers to the following questions: What kind of establishment are you? For example, are you a bar, restaurant, retail store, or hotel? Does drinking happen off-premises or on-premises? Off-premise operations may be brick and mortar retail stores or websites that sell and ship spirits. On-premise operations are bars, restaurants, and/or catering businesses. What kind of alcohol do you sell? Beer, wine, cider, and liquor have different license classifications. States that permit the sale of cannabis products may also have a separate license classification for businesses that offer marijuana products along with alcohol. Are customers bringing their own alcohol, or will you store and serve alcohol? Bring-your-own-bottle (BYOB) operations still require licenses. What hours do you sell? Generally, the later you stay open, the more expensive the permit. Will you sell on Sundays? Some states charge an extra fee for Sunday sales. Do you manufacture, distribute, or sell alcohol, or any combo of the three? Breweries, wineries, and distilleries have separate licensing requirements. On-premise vs Off-premise Consumption There are two main types of liquor licenses: those for on-premise consumption and others for off-premise consumption. These are sometimes referred to as on-licenses and off-licenses. On-licenses are for businesses that plan to sell alcohol for customers to drink on the property, such as bars, breweries, and restaurants. Off-licenses are for businesses that sell alcohol to-go, such as liquor stores. Choose the Correct Class of License Within the categories of on-premise and off-premise, licenses are further categorized by class. The class of the license determines what type of alcohol your business is permitted to serve. Some states use letters while others use numbers to describe the various license classes. For example, a full-service restaurant that serves a full bar featuring wine, beer, and spirits in Washington, D.C., needs an "On-premises Retailer Class C/R license." The same business in California would need a "Type 47" license. In New York City, it is an "OP 252." Regardless of whether a state uses letters or numbers to distinguish between license classes, they tend to use the same criteria to define the various types. Off-premise Liquor License Classes Liquor licensing authorities categorize off-premise liquor licenses in two ways. The first distinction is between physical storefront retailers or online retailers. Both types of retail stores then have license options based on the products they offer. One kind of license permits the sale of beer, wine, and liquor, while another permits only beer and wine sales. Beer, wine and spirits: The license allows a store to sell spirits, beer, and wine for consumption off the licensed premises. Beer and wine only: This permit limits a store to sell only beer and wine that will be consumed off  the licensed premises. Internet sale of beer, wine and spirits: This permit is for retailers without a physical storefront to sell spirits, beer, and wine via a website. Internet sale of wine and beer only: This type of license allows a retailer to sell wine and beer via a website without a physical storefront. On-premise Liquor License Classes There are also different types of on-premise licenses designed for different kinds of establishments. On-premise license classes are much more numerous than off-premise licenses. When you consider the variety of businesses that serve alcohol on-site, this makes sense. A bed-and-breakfast that hosts a nightly wine tasting must have a liquor license but not the same one as a restaurant with a full bar. The different types of on-premise liquor licenses are categorized by business type: Tavern: This license is for businesses whose primary revenue comes from alcohol sales, such as bars. Sometimes called a Nightclub License Private Club: This license permits members-only venues like country clubs to sell alcohol. Brewery: This license allows spirits makers to serve alcohol on the premises where it is manufactured. Restaurant: This license permits restaurants to sell any type of alcohol but limits what percentage of your revenue can come from alcohol. Beer and wine: This license is for businesses that wish to sell beer or wine (often to complement food) but won't be selling hard liquor. Seasonal: This license is prorated for the needs of businesses that only operate seasonally, like bars and restaurants in ski resorts or summer destinations. Nonprofit entity: This license allows nonprofit organizations like theaters or symphonies to sell beer, wine, or cocktails for a set number of hours before, during, and after a performance. Special Event: These licenses enable the sale of spirits at non-traditional venues for special events, like weddings or fairs. BYOB: This type of permit covers businesses that allow customers to bring their own bottles of wine or beer to consume on the premises. Some states have many more categories. Seaside towns, for example, may have specific license requirements for businesses that operate on docks or in open water. In markets where it is permitted, serving cannabis-infused items on your premises may influence the class of liquor license required. Most state's alcoholic beverage control board websites have a questionnaire feature that will guide you to the correct license type. 2. Verify Your State's Requirements for Liquor Licenses Check with your state's local ABC board to determine specific costs, availability, and processes in your area. Select your state below for the common price range for licenses in your area and the website of your state’s liquor licensing website. It is important to note that these fees are only the filing and processing fees charged by the state. Your total costs will be higher if you buy a liquor license from an existing business. Select State Alabama Arizona Arkansas California Colorado Connecticut Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Louisiana Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania South Carolina South Dakota Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Determine Permit Availability Many states and localities have a limited number of liquor licenses. In many cases, areas are already pushing their license limits and have few, if any, new liquor licenses available. You may have to check availability at the state, county, or city level, depending on your location. The ABC board can give you information on availability limitations and confirm if a liquor license in your class is available. It can also explain how it handles new license requests, which also varies by state. For example, some California counties hold a lottery if there are more applicants than available licenses. Purchase a Liquor License From an Existing Business Even if there are no new liquor licenses available in your area, there may be other ways to attain a liquor license. Some locations allow businesses that are closing to sell their liquor license. Your state's ABC often tracks this process and can inform you of those options. For instance, Illinois makes contact information available for all existing licensees. When purchasing an existing liquor license, you may have the option of purchasing just the license or purchasing the entire restaurant. Buying an existing liquor license or a business with a current license requires many of the same steps as obtaining a new liquor license. You still must go through the same application process as you would when applying for a new liquor license. However, you can apply for a temporary permit that allows for continued operation while your application is being processed, usually 120 days. 3. Determine Liquor License Costs The costs of liquor licenses can vary widely from place to place. Most locations charge a small filing fee of around $100 to $300 then a larger filing fee once your application is approved. In addition to state licenses, highly populated cities and counties have their own licensing requirements and fees. Los Angeles county, for example, requires that all businesses serving alcohol have what is known as a Conditional Use Permit (CUP). The fees for a CUP vary depending on your business’s hours of operation, with those operating at later hours paying more. Below are some examples of the application fee and filing costs for several sample states. In an attempt to compare apples to apples, the license type represented below is a new license for a restaurant that wants to sell beer, wine, and liquor until approximately 2 a.m. in a major metropolitan area. Fees for New Liquor Licenses, by State * Total cost will be higher if you buy a license from an existing business. Prices for existing licenses are based on supply and demand in your area. Liquor License Funding Options As you can see in the chart above, liquor licenses can be pricey. However, if you are starting a new business, applying for a liquor license will be just a fraction of your total costs. You'll need to lease and outfit a storefront, purchase goods, hire and train your staff, and advertise your business. There are many small business funding options available, including bank loans, small business loans, and business credit cards. 4. Prepare Your Liquor License Application Regardless of whether you are getting a new license or buying one from another business, you will need to submit a license application. The approval process can take months, and it will take even longer if your application is incomplete or contains errors. Properly preparing for the application process can save you months in processing time. In most cases, obtaining a liquor license requires that your business already has: An Employer Identification Number Any required Zoning permit Business license Sales Tax Permit Alcohol Tax Permit Food handler's permit (if you are selling food) Building permit Sign permit Health permit Music license (if you play copyrighted music) Your liquor license application will be put on hold until each of these documents is secured. If you have been in business a while, you should also make sure you are up-to-date on all tax payments. If you are behind on your taxes, the state will not look favorably on your liquor license application. You will also need to include a current lease agreement with your liquor license application. If you're a new business, the thought of signing a lease and securing a property before you have a liquor license may seem scary and counterintuitive, but it is a requirement. To minimize any risk, work with your landlord to put in an escape clause in the lease. This way, if you are denied a liquor license, you can cancel the lease contract. 5. File Your Liquor License Application With the ABC Once you have your prep work done, it's time to file your application with your state's ABC Board. This usually involves downloading a form from your state government website that you either mail to the ABC board or deliver in-person. Items to Include Most liquor license applications require a wealth of information about your business and its owners. In addition to including copies of required permits, most liquor license applications require background checks, fingerprints, and financial records. These items may include: Processing fee: Nearly every state has a non-refundable processing fee. Some are just deposits against the license fee. Ohio charges a $50 to $100 processing fee depending on the type of permit you need. Background check forms: A background check will be performed at least on the business owner. Fingerprint(s): Most states require fingerprints for the background check. Signed lease agreement: As mentioned earlier, you will need to provide a signed lease agreement of your business location. Financial verification sheet: Some permits depend on the total expected alcohol income your business is projected to earn. Liquor License Approval Process Once you send in the form with copies of permits and a set of fingerprints, the approval process varies for each state. Typically, it takes five to six months to get your license. In busy markets like Los Angeles, approval can take up to a year. For reference, here is an example of what happens in Ohio once you submit your application: The application is logged in to the system and sent to local legislative bodies and authorities. The ABC board works with local officials to determine zoning restrictions and whether new licenses are available. The ABC board works with the Ohio Bureau of Investigation to process background checks. A Division Compliance Officer performs a physical check of your premises, noting what schools or churches are within 500 feet of your location. (they will then be notified and have 30 days to object). If your business does not pass inspection, you'll need to correct any issues and request a re-inspection. A Public Hearing is conducted if any complaints were filed. If no one files a complaint or you have resolved all complaints, your application should be accepted. In four to eight months, you will receive your permit. Tools for Navigating the Process Considering all the moving pieces involved, securing a liquor license can feel like an overwhelming process. Especially if you are launching a new restaurant, the process can be lengthy. In nearly all locations, you can find permit expediting services or liquor license brokers to help oversee your liquor license application. These services all have affiliated costs, of course. However, if they save you administrative time or the costs of re-filing incomplete or inaccurate applications, they are absolutely worth it. License Lookup Services Several legal service websites offer license lookup tools. These are an incredibly cost-effective way to ensure that you have the correct information for the permit and licensing requirements in your area. , for example, offers a Business License Research package for $99. This service provides a complete list of all of the licenses and permits you need for your business, plus copies of the application forms you need to file. License Brokers Business owners in busy markets like New York and Los Angeles will find it incredibly easy to locate liquor license brokers. A liquor license broker— sometimes also called a consultant— will usually handle your entire liquor license application process from beginning to end. This is especially useful if you are purchasing a license on the open market or from an existing business. You can find a license broker or consultant by performing an internet search for "liquor license broker" (or consultant) and your location. Another option is to ask business owners in your area for recommendations. Once you locate a broker, ask how they research available licenses. You will want to be sure that any license you buy from an existing business is free of tax or vendor liens. You may inherit those issues with your purchase. License broker costs vary widely from location to location. Most brokers and consultants will offer you a free quote based on your business’ licensing needs. Permit Expeditors Permit expeditors are typically former health or building inspectors. Some, however, are business attorneys who specialize in the hospitality industry. In either form, permit expeditors are experts at navigating the permit process, and they have many contacts at city offices. Most permit expeditors prefer to handle all of the permits for a new business. However, some are willing to handle a liquor license alone, especially if it is a business-to-business transfer of an existing license. You can find permit expeditors in your area by performing an internet search for "permit expeditor" and your location. If you have a network of local business owners, ask them for recommendations. Costs for permit expediting vary widely depending on your needs and the location. Like brokers, most expediting services will present a free quote tailored to your needs. Obstacles to Getting a Liquor License To apply for a liquor license, you often need to be of a certain age and a US citizen. Many states have specific restrictions on what days or hours you can sell alcohol. They may also stipulate that a particular percentage of your overall revenue comes from food sales. Local businesses, schools, and churches within a certain distance of your proposed location will be notified of your liquor license application. Often, they have the right to file an objection. Sometimes these objections lead to a full-blown appeals process where your hours of operation or use of outdoor spaces may be limited before your license is approved. If your application is incomplete or contains errors, it will be rejected. In many places, re-applying requires paying all of the licensing fees again. If the approving agency is a busy one, it may be a few months before you receive the rejection, in which case you will have lost time as well as money. Renewing Your Liquor License The term of most liquor licenses is one to three years. The times vary based on state and local regulations. There is no automatic guarantee that your license will be approved for renewal. If you have had issues with noise or served minors, your renewal request may be denied. However, if you have operated reputably and have not had any significant complaints, you should be able to renew your license easily. Depending on your state, the renewal fee may be similar to or significantly less than your original fee. For example, in California, fees for a new license can be more than $13,000, but the annual renewal fee is $876. Frequently Asked Questions (FAQs) About How to Get a Liquor License How long does it take to get a liquor license? Getting a liquor license can take as few as four months and as long as almost a year. The average time for acquiring a liquor license is five to six months. You can help ensure a speedy application process by including all of the required documents and permits within your application. If there are any missing elements, that can drag out your liquor license application process. What are the liquor license costs? Liquor licenses can cost as little as a few hundred dollars or over $14,000. The cost depends on your state and city. Generally speaking, licenses will be more affordable in rural areas and more expensive in competitive metro areas such as New York City and Chicago. What is a temporary liquor permit? A temporary liquor license, or temporary liquor permit, allows businesses to serve beer, wine, or liquor for a specific and limited period of time. Temporary liquor permits are typically valid for 90 to 180 days, depending on the state and type of permit. They are used for special events or by new businesses that want to serve alcohol before their permanent license is approved. Do you need a liquor license to sell wine? Yes. Any kind of restaurant, bar, or retail store needs a liquor license to sell wine, whether customers consume it on-premise or off. Some states make an exception for businesses like salons that offer a complimentary beverage to customers. In those areas, you can provide customers with up to 12 ounces of complimentary beer or wine during business hours. It is essential to check with your local Alcohol Control Board to ensure you are operating within the bounds of local laws. Bottom Line Getting a liquor license is an extensive process. It will take months and often require back-and-forth questioning and verifying of information. The best way to ensure a smooth process is by taking the time to check all of the application requirements for your state and city before submitting them. A business license research service like the one offered by can help you ensure that you have all the necessary paperwork for your application and that you understand all of your local license requirements. Spending $99 in the short term can save you time, money, and the headache of having an incomplete application denied.  

Buying a restaurant is a cost-effective way for first-time restaurant owners to enter the hospitality industry. Buying an existing restaurant is ideal for restaurateurs who want to step into a fully functioning operation. Those who want to put their signature on a space, however, can buy a restaurant’s assets—such as the lease, furnishings, and kitchen equipment—and rebrand the business. When you are in the process of starting a restaurant, buying an existing business can save you time and money. An existing restaurant already has the necessary operating permits and licenses. Specialized equipment like kitchen hoods and grease traps are already properly installed. Building and health inspections have already been done. If you plan to keep the whole concept from furniture to menus, you will also inherit vendor relationships and employees. Pros & Cons of Buying an Existing Restaurant There are some risks, however. If the seller has failed to pay vendors, or the restaurant has low ratings on popular consumer sites like Yelp, you may need to rebrand the business. Your cost savings will also depend on making as few changes as possible to the restaurant space. So if you have a dream floor plan, you may need to wait to see it built. What you buy when you purchase a restaurant will vary depending on the restaurant’s profitability and reputation. Let's explore the five steps involved in buying a restaurant. 1. Find a Restaurant The first step to buying a restaurant will be finding one that is available for sale. There are a couple of ways to find restaurants for sale. The most common are working with a broker or searching online listing websites. Before you visit your first listing, you’ll also want to take time to narrow down the type of restaurant you are looking for. Working With a Broker If you don’t have much restaurant experience or many restaurant industry connections in your area, working with a broker is your best bet. Two types of brokers can help: business brokers and commercial real estate brokers. Ideally, you want a business broker who specializes in restaurants. In smaller markets, however, you may have trouble finding someone this specialized. In that case, a commercial real estate broker will likely have the information you need. Working with a commercial real estate or business broker has several benefits. Brokers likely know of businesses that are available before they are publicly listed. Brokers know the market. Depending on their particular area of expertise, they may also be able to advise you on lease terms, permitting issues, or other governmental regulations. To find a commercial real estate or business broker, do an internet search for “restaurant broker” and your location. Using Online Listings As an alternative to working with real estate or business brokers, you can search listing sites like or . These sites list enough information to get you started, but to assess the business and execute a purchase agreement fully, you will need to retain the services of an attorney who specializes in business transactions. Determine What You Are Looking For Before you visit restaurant locations, it is important to know what sort of restaurant you want to purchase. You can buy the entire business, including the existing business entity, in a bulk purchase of the whole operation. Alternatively, you can form your own business entity and only purchase certain assets of the restaurant. These assets can include: Equipment: This can include kitchen equipment like cooking ranges, ovens, and refrigerators. It can also include bar tools (like ice bins and soda guns), general equipment like grease traps, or specialized tools like the restaurant’s point of sale (POS) system. Furnishings and small wares: Furnishings include furniture like tables and chairs, or fixtures like lighting equipment. Small wares are plates, cups, and silverware. Lease or property: Most restaurants do not own their location; they instead operate with long-term commercial lease contracts. Part of buying a restaurant business involves taking over what remains of the lease. If the restaurant owns its location, however, the property itself may be part of the purchase. Branding: Sometimes, you may only be interested in purchasing the restaurant’s name and trademark. If the restaurant name is trademarked, make sure the trademark transfers to you in the sale. Liquor license: Liquor licenses can be hot commodities, especially in areas like Los Angeles that limit the number of licenses available. Sometimes restaurants sell their liquor license separately from the rest of the business. Permits and insurance policies: If you are planning to buy the entire business, permits like the certificate of occupancy or health and safety permits should come with the deal. Insurance policies that are tied to the business—like liability and workers’ compensation—should also be up for discussion. Operational documents: You may want to request any training programs, employee handbooks, menus, and other documents that govern how the business operates. This also includes documents that establish the business entity such as incorporation documents that form the LLC, and sales and payroll tax ID numbers. If you intend to keep the restaurant running as is, you want to pursue a bulk purchase. A bulk purchase includes all of the assets listed above. If you plan to rebrand the business or dramatically renovate the space, purchasing only the relevant assets is a better option. Ask yourself these questions to help determine what type of restaurant you are looking for: Will you keep the seller’s name and brand? If yes, be sure that the restaurant has a stellar reputation and the operation is currently profitable. What are your planned hours of operation? Try to find restaurants that currently operate with similar hours. Some neighborhoods have zoning restrictions that limit the hours a business can operate. What equipment do you need to execute your menu? Getting a chef’s guidance on this can be as easy as posting a question in an online message board. Do you plan to serve alcohol? Zoning regulations restrict bars in some neighborhoods. Consider Each Potential Space Try to visit each restaurant you are considering anonymously as a customer first. Experiencing the space from a customer perspective allows you to recognize the strengths and weaknesses of each restaurant. When dining, pay attention to general features like the ambiance and overall cleanliness of the space. You should also note the flow of service. Are employees able to work around customers efficiently? Is there enough room at the bar, in the entryway, and the guest restrooms? Several other questions can help you determine if a restaurant space is the right fit for you: Are direct competitors nearby? Does the layout work for your concept? Is the location accessible to your target customer? Is there parking or valet for customers? Do you notice any bottlenecks? Do the staff and customers appear happy? If a restaurant business seems to fit your criteria, your next step is to contact the owner. Take care to reach the owner directly via email, phone, or in person. Avoid identifying yourself as a potential buyer to restaurant employees; they may not know that the business is on the market. When you revisit the restaurant as a potential buyer, pay special attention to the non-public areas of the space. If you are not an expert in kitchen equipment, try to bring along someone familiar with those systems who can assess the quality of the equipment. Check the Restaurant’s Performance Metrics There are typically two reasons restaurants become available for purchase: the business is not performing well or the owners are selling for personal reasons. You can tell why a restaurant is on the market by asking the seller. You can verify their reasoning by looking at the restaurant’s performance metrics. Once you make a serious inquiry about purchasing the business, the current owners should be willing to provide you with some basic performance data. Some restaurant owners include a snapshot of this information in the listing itself, such as a statement like “$250,000 annual sales.” However, you should still ask to see the actual financial records to verify this. Most restaurant owners will ask you to sign a nondisclosure agreement (NDA) before looking at their financial records. Requesting an NDA is a standard practice to prevent competitors from acting in bad faith. When you are considering buying a restaurant, you’ll want to get an idea of the business’s overall cash flow. Cash flow is just the amount of cash flowing into the business, minus the cash that flows out of it. Positive cash flow simply means that a restaurant brings in more money than it spends. Cash flow is sort of a catch-all number, intended to provide a thumbnail sketch of the restaurant’s performance. Cash flow is actually determined by the restaurant’s performance metrics. To fully understand the restaurant’s cash flow, ask the seller for these underlying metrics. The metrics will show you exactly how cash is flowing in and out of the restaurant. For example, overall cash flow might look fine, but the underlying metrics may indicate problems with labor or food cost. The question then becomes whether or not you have the ability (or appetite) to fix those problems. You might prefer to continue looking at other restaurants with fewer issues. Some key performance indicators to ask about are: Labor cost: This number illustrates how much the restaurant spends on hourly staff wages and benefits, expressed as a percentage of total sales. Ideally, labor cost should be 30% or less. Food cost: Food cost tells you how much a restaurant is spending on the food it sells. Like labor cost, you want to see a food cost that is 30% or less. Prime cost: This is the combination of all the restaurant’s costs and expenses like manager salaries, rent, permit costs, and overhead expenses. You want to see a prime cost that is within 55% to 65% of a restaurant’s total sales. Profit margin: Profit margin tells you what amount of top-line sales flows through to the restaurant’s bottom line. A good restaurant profit margin is 5% to 10%. Anything less than 5% indicates that the business is struggling. Whether a restaurant’s metrics are strong or weak will dictate your next move. If the restaurant has strong financial metrics, it is a great candidate for bulk purchase. These restaurants are great for buyers who want to keep the same menu, name, and brand. If you plan on making drastic changes, however, it might be a waste to buy a restaurant that is performing well as it is. A restaurant that is not performing well financially may still be an exciting property for other reasons. Purchasing this type of restaurant makes sense for restaurant owners that plan only to buy assets and completely rebrand the business. Owners who feel equipped to correct cost issues may also be interested in this type of restaurant. For example, a high labor cost that is negatively impacting a restaurant’s bottom line isn't a big deal if you know how to reduce labor costs. 2. Secure a Lawyer & Evaluate the Business Once you decide to purchase a restaurant, you must secure a business attorney. Buying a business, particularly a restaurant, requires much legal paperwork so find a lawyer with restaurant expertise if you can. If you are purchasing the entire business entity, you inherit relationships with state and federal tax authorities. You will need to be doubly sure that your interests are protected. A business attorney will draft or assess critical documents like: Letter of intent: This document memorializes your intent to purchase the restaurant and will set the basic terms and conditions of the purchase. Lease agreements: Buying an existing restaurant usually means taking over a current long-term commercial lease. An attorney will assess the lease terms and raise any red flags you might otherwise miss. Purchase agreement: Also referred to as a purchase contract or sales contract, the purchase agreement is the official document that governs the sale of the business. It lays out terms like the agreed-upon purchase price and any conditions that must be met by either party to complete the sale. You can find an attorney who specializes in business sales by contacting the local branch of the American Bar Association. Alternatively, sites like LegalZoom have searchable directories of attorneys in your area. A website like is also useful if you plan to purchase only a restaurant’s assets and need to create your own LLC; the site has a user-friendly interface to walk you through that process. Appraise the Business Value The appraisal is where you place an actual value on the business assets and the business itself. There are many different methods to determine a fair price for the sale of a restaurant business but most restaurants are evaluated by profit. A standard guideline for determining a ballpark restaurant value is to calculate three times the annual profit. For example, it would not be unusual to see a business that earns $150,000 in yearly profit listed for an asking price of $450,000. That is just a general number, however. The actual value of a restaurant business depends on many other factors, such as the value of the restaurant’s equipment, location, and the overall climate of the restaurant market. There are also intangible qualities that may make a business more or less valuable. If the restaurant you are considering is a beloved local landmark, this may increase the restaurant’s value. Your business attorney will likely have a business valuator they like to work with, or you can search for a business appraiser through freelance communities like Upwork. Alternatively, a business valuation provider like offers a business valuation service for $495. This service provides a detailed business valuation that includes a financing assessment and an in-depth industry report. 3. Get Funding You’ll need to have your funding in line before negotiating the final purchase. Small business loans will likely be a part of your funding plan. However, to present a robust application to banks, it is essential to show that you are willing to invest personally in this business. Personal Investment Plan to have at least 10% of the purchase price as a down payment. Qualifying for some small business loans, however, requires a down payment of up to 30%. If you have a 401(k) from a previous job or a retirement account, you may be able to use some of these funds to invest in your business. You can invest personal money from savings, gather funds directly from investors, or crowdfund with small investments from family and friends. Loans To get favorable financing, you should have a personal credit score above 680, letters of recommendation, and a convincing business plan. Restaurant business loans can be tricky to obtain because lenders consider the restaurant industry as especially turbulent. Loans backed by the Small Business Administration (SBA) can make lenders more comfortable issuing credit to buy a restaurant. Traditional banks issue SBA Loans but the SBA backs those loans, which reduces the risk to lenders. You can apply for an SBA loan via a local bank. Alternatively, you can use a lending marketplace like , which allows small businesses to complete a single application and reach hundreds of different lenders. Investors If your credit history is not strong enough to qualify for a small business loan, you will need to rely on personal resources or individual investors. Working with investors will require your attorney to draw up an investor agreement to govern the relationship between the investors and your business. This agreement should lay out the timeline on which investors will be repaid, and the additional benefits (such as dining discounts) they may receive. 4. Negotiate With the Seller With funding in place and a detailed evaluation of the business’s assets, it is time to consider which assets you want and how much you are willing to pay for them. This process will likely require a few rounds of negotiation with the seller. Understand What You Are Buying You want to understand precisely what you are getting for your money. The seller will want to keep track of what assets he or she may still have to present to other buyers. For example, you want to purchase a restaurant that has an active liquor license that you do not intend to use. The seller can then sell that license to another buyer. Be methodical; consider every asset. Don’t assume that an item is included in the sale—ask. Purchasing the menu does not necessarily mean that the current inventory of ingredients will be transferred. There are big ticket items like ovens and leases, but don’t forget small items like social media profiles. You’ll want to get the passwords to those turned over as part of the deal. Sign a Letter of Intent After you and the seller are on the same page about what assets you plan to purchase, you need your attorney to draft a letter of intent. A letter of intent is a non-binding agreement that outlines the broad terms and conditions of the final sale. It will include the expected purchase price based on the appraised value of the business. This letter essentially says that, barring anything strange appearing in your attorney’s analysis of the company, you intend to buy the business and at this price. Do Your Due Diligence Performing due diligence is a similar process to the performance metrics analysis that you did previously. Due diligence, however, is more involved. Due diligence goes beyond cost-control and cash-flow considerations. It looks at the legal, structural, and operational side of the business in detail. The point of the due diligence process is to gain a clear picture of the health of the entire business, not just the cash-flow. This step is essential before finalizing the sale. You can discover things during this step—like unpaid sales tax or workers’ compensation claims—that may affect your desire to purchase the business. Alongside your attorney, you should assess: The restaurant’s lease: How much time remains on the lease contract? Are the terms favorable? Do you have the option to sublease or transfer the lease in the future? Financial information: Consider balance sheets, income statements, and tax returns to confirm the restaurant’s financial performance records. Insurance policies: You will want to look at the restaurant’s general liability policy, workers’ compensation policy, and employee health insurance policies. Are the premium rates fair or are they due to increase soon? You’ll want to know about recent workers’ comp claims, especially if there are any outstanding. Permits and licenses: Determine what permits and licenses are tied to the business and confirm they have been renewed when necessary. If you are buying the entire business, you will inherit the tax history. You’ll want to confirm that all current taxes have been paid. Patents and trademarks: If a restaurant has a trademarked name or a patented system for cooking the world’s best chicken wings, be sure these assets remain with the business you are purchasing. Personnel information: Look at employee salary information, payroll documentation, typical schedules, and employee bonus plans to confirm labor cost and prime cost performance metrics. Inventory and vendor contracts: You should also ask about existing contracts with vendors, especially if the menu depends on obscure or difficult to source ingredients. Ideally, nothing surprising pops up during your due diligence analysis. If something does, though, it is customary to adjust your proposed purchase price or add stipulations to the purchase agreement. For example, if due diligence reveals that the restaurant is late on a sales tax payment, your attorney will likely stipulate that those taxes are paid before you move forward. 5. Complete the Purchase Once you and the seller agree on the terms of the purchase, it is time to make it official. First, you and the seller should decide on a closing date—the date the business will transfer to you. Then, reach out to your lawyer to draft a purchase agreement. Once you and the seller have both signed the agreement, the sale will be complete on the closing date. Transition & Closing Date Before you choose a closing date, meet with the seller to discuss the details of transitioning the business. Typically, a restaurant closing date is scheduled at least two months after all parties agree to the sale. The time between reaching an agreement and closing on the deal is the time when you and the seller should transition all the restaurant systems. The transition can involve administrative tasks like updating permits and vendor accounts with your contact information and formally meeting employees. In some cases, the seller may offer to train you for a couple of weeks. He or she may want to show you the ins and outs of the payroll systems, purchasing arrangements, and how to use the point of sale system. This training can be particularly helpful if you are buying a long-standing restaurant that has a loyal customer base. You will want the seller to introduce you to your regular customers personally. During the transition period, you should also allow time for: Code updates: Some local licensing authorities require upgrades when a business changes hands. Check with the appropriate authorities to ensure you have met all the necessary requirements. Renovations: The transition time also allows you or the seller to make any renovations that are required. Marketing: You may want to let the public know that the restaurant is under new management. If the business has a social media presence, ensure that transferring those accounts is part of the transition. Draft a Purchase Agreement The purchase agreement is a binding contract that governs the terms of the sale. Your lawyer will need to create this document for you. Typically, the agreement contains the purchase price, the closing date, and lists the warranties and transactions that must take place before closing. It will also include a list of outstanding costs—like closing costs, renovation expenses, cost of transferring permits—and who is responsible for paying them. Sign the Purchase Agreement Once your attorney has drafted the contract, you send it to the seller. The seller will likely have his or her attorney review it before signing. It is common practice for the buyer’s attorney to include a non-compete clause in the purchase agreement. A non-compete clause prevents the seller from opening a similar restaurant in the same market that could directly compete with the restaurant you just bought. When the closing date arrives, you release the money to the seller and the seller releases ownership of the restaurant to you. Congratulations! Bottom Line Buying a fully operational, existing restaurant is a great way to get started in the restaurant business. Do your research and your due diligence to ensure that you know the strengths and weaknesses of each prospective restaurant before you make a decision. A good business attorney is necessary to assess documents like leases and insurance policies, and to write a purchase agreement that works for you.