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How to start a restaurant business ?

Mizpah (7 posts) • 0

Hello every body, I am a foreigner looking for opportunity to make a restaurant in kunming or nearby area. But I still can't google from where to start with and what kind of department I have to apply for it?.

Any body can help me to guide what to do or tell me any lawyers company or agent who can help me to register all doccuments to start a restaurant?

If any body who have well information kindly contact me through my qq: 1034407133

All help and guidance is really appreciable. Thank you to you all, looking fwd for all replies and comments.

JanJal (1243 posts) • 0

I recommend www.yu-cong.com. Max speaks good English and has helped several foreign businesses in Kunming to get started and operating.

Magnifico (1981 posts) • 0

www.chinalawblog.com has a lot of useful information about business in china. it's set up by a law firm, but not sure if they operate in kunming.

Magnifico (1981 posts) • 0

also, go to the psb and let them know what you're planning to do? sorry, not sure how it works. but that's what i would do. good luck.

johannesjohannes (57 posts) • 0

Get max in and save up to 500000 rmb.getting the business license and business visa will cost you up to 20000 kuai but you need to bring with you 300000 kuai as investment.find a nice place,decorate it and there you go.try to get your investment back within the first 2 years and after that money will flow in

laotou (1714 posts) • 0

@mizpah
You're asking a website blog for professional business advice - so good luck with that. Edmond (Edward?) Yang frequently advertises his legal services on this site. He speaks sufficient english for communication, so suggest you start with a consultation on what you want - have him respond with a quote for services.

Don't try to skimp on this phase, as if the law firm screws ANYTHING up - you're looking at a heap of headaches to rectify the situation.

Lawyers can usually refer you to accountants that they've done business with. NEVER trust your accountant, regardless of whether in China or any other country in the world. As my Grandfather always said, "Your hand is your pocket's best friend."

You'll need an accountant to file your monthly/quarterly and annual tax returns. Accountants can also help set up legitimate, CLEAN companies of almost any kind.

You'll need an INVESTMENT VISA unless you're married to a local - so before even thinking about a restaurant and all those details - you'll need to research the requirements for investment visas.

Used to be you could do low capital investments - such as a USD 10k investment - but that severely limits you to how many expats you can hire and what you can do.

Starting your restaurant - you'll need to have the restaurant designed by LICENSED design shops and then comes the blood-sucking construction. I't not that they're thieves (they are), but they're essentially unskilled labor and their boss guesstimates schedules, costs, and resources, apparently using his toe for a brain.

Cost overruns during construction can run over 100% depending on whether you use a reputable firm or try to cheap it and subcontract all the labor yourself.

For operating capital - you should plan on at least 3-6 months of operations (aka salaries, rent, utilities, advertising on gokunming) to include your own living costs, with essentially ZERO revenue. So ANYTHING you make will be helpful.

Timing is critical. Do NOT open your restaurant when expats are flowing out (end of contract) or during the Spring Festival when everything is dead. You'll suffer 1-2 months of near zero revenues, unless you have a stable base of non-fluxing expats/locals...not to mention your staff may not be around during the holidays. If they work - you'll have to pay the government mandated premium for working holidays - your accountant or lawyer can tell you this cost.

MOST of your profits won't come from food sales - it'll be from the sale of liquor and beverages - so you'd better plan on getting a liquor license, find lowest cost reliable suppliers (anything cheaper than metro) and plan out your liquor and beverage menu in advance. Other restaurant owners MAY help with referrals - should be good for a couple of cases of free promotional beer from the vendors for the referral.

STAFF
China law - full-time (not sure about part time) staff must be paid one month's severance pay for each year worked (pro-rated). You'll also need to pay their social insurance and healthcare annually - an accountant can be invaluable in setting this up - but beware as unscrupulous accountants can inflate many of these costs for kickbacks. Ask around so you know the answers BEFORE you ask the questions.

You can do the investment visa paperwork yourself - but it's a royal Pain in the Pigu first time around...keep detailed notes and records, so you know the process for subsequent years. If you've never lived in China before - you'll have to live here roughly five (5) years before you can apply for a multi-year visa. Until then - it's year to year visas - which is irritating, time-consuming, and occasionally frustrating (when they change the rules, processes, or just feel like giving you a hard time).

Finally - most businesses (98%) fail during the startup phase (first 12 months) because of lack of planning and un-realistic expectations - to include the sales and marketing.

Before opening your restaurant - make sure you hype the place significantly - have a soft grand-opening for friends, acquaintances, staff and all their friends & family) (free or discounted food & liquor), prior to your formal grand opening. Invite (paid/unpaid) the gokm reporters and other domestic media to your grand opening event. If you have a specialty restaurant - such as the Spanish Tapas recently suggested - have s story to tell the Chinese media - get them to hype your grand opening (grand opening week?) on local TV. They're starved for news and variety. Hit the newspapers also - although I don't know the effectiveness of those special interest stories or if they even have a Living and Lifestyle section.

Good luck with your venture and remember things RARELY go according to plan - but if you don't have a well thought out plan - things can and usually do spin wildly out of control.

Finally - watch your construction team like a predator - make sure you have their project schedule and they're ON SCHEDULE and ON BUDGET on an HOURLY, DAILY, and weekly basis - chew out the manager if their late with a single brick (you need to calculate how many bricks they have to lay to hit their schedule).

As they say, a plan without a date (schedule) is just a dream...and that will cost you hard cash and time.

You MAY need government inspections (wiring, health food rating, etc) - that will delay you - especially if they're corrupt and you don't want to pay. Suggest you invite them to your grand opening (gratis).

You should also plan for staff churn. Suggest you talk to Salvadors about how they retain their staff - you might even be able to get some staff referrals if you offer the same (or better) benefits and compensation packages). It's no secret - I like, admire, and respect Salvador's HR model a LOT.

TRAINING
You're in an essentially unskilled market - you'll need to train, supervise, and manage EVERYONE and they're gonna want to do things THEIR way (stubborn mules) if you're not watching. You're looking at 7 days a week, 18-hour days for the next 12 months of your life - MINIMUM. In that time of hell - watch your staff carefully for signs of responsibility, talent - you may be able to groom them as your managers...whom you'll have to train and watch carefully...(unless you marry him/her) - but that's another contentious thread.

Liumingke1234 (3297 posts) • 0

Wow! Enough info. to discourage opening up any business. Ha..Ha.

mike4g_air (788 posts) • 0

How do you get a million RMB in your bank account from owning / operating a restaurant business in china?

You start with two million.

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