IndustriesRestaurant
A restaurant business plan that survives an underwriter
Full-service restaurants are underwritten on covers, average check and prime cost. A plan that cannot state all three, and show where they came from, is a plan a credit committee reads for two minutes.
Written for an SBA or bank loan, which is where most plans in this sector goNAICS 722511
Where the money goes
Typical shares of revenue in this sector. Shown as a starting point to argue with, never as a target to hit — your own figures replace all of these at intake.
- Food and beverage
- 31%
- Beverage mix moves this more than menu pricing does.
- Labour
- 33%
- Front and back of house. Prime cost — food plus labour — is the number a lender computes first.
- Occupancy
- 9%
- Rent, insurance and utilities. Above 10% the margin rarely recovers.
- Marketing
- 3%
- Mostly local and event-driven.
A worked model
One plausible restaurant, built out in full.
Not an illustration. These assumptions were run through the same engine the product uses, and the plan review was run over the result. It is here so you can see the shape of the answer before you start.
- Year 1 revenue
- $1.3M
- Year 3 revenue
- $2M
- Operating profit from
- Month 4
- Year 3 net margin
- 7.0%
- Coverage, first full year
- 4.14×EBITDA less tax, over debt service
Balance sheet ties in all 60 periodsNo blocking findings — this model would exportLowest cash $94.8K in month 3
The revenue build
Not a growth rate. These are the drivers a reader can argue with, which is the only kind worth putting in a plan.
Dining room
Traffic × conversion × ticket
- Daily trafficPeople past the door, or covers seated
- 210
- ConversionShare who buy
- 62%
- Average ticket
- $38
- Open days per month
- 26
- Monthly growth
- 0.0%
- Cost of salesFood, drink or goods only
- 31%
Sixty months of it
Monthly revenue against monthly EBITDA. Both are flows, so they share an axis honestly — plotting a cumulative cash balance beside a monthly figure would flatten the one that matters. The cash trough is in the strip above.
- Monthly revenue
- Monthly EBITDA
Year by year
| Year | Revenue | EBITDA | Net income | Closing cash |
|---|---|---|---|---|
| Year 1 | $1.3M | $89.3K | -$12.6K | $264.3K |
| Year 2 | $1.8M | $270K | $135.3K | $453.9K |
| Year 3 | $2M | $278K | $139.7K | $639.4K |
| Year 4 | $2.1M | $353.4K | $200.1K | $883.9K |
| Year 5 | $2.2M | $410.7K | $246.3K | $1.2M |
Sources and uses: $500K debt, $180K owner capital, $505K of fit-out and equipment. 13 people on the payroll by month 36.
Against the restaurant (full service) band
Benchmarks warn; they never overwrite. An assumption outside the band is flagged with its source so you can justify it — substituting an industry median would destroy the specificity that makes a plan credible.
- Gross margin, before direct labour
- 69.0%in band
- 60.0%median 68.0%73.0%The published band is quoted on cost of goods alone, so this is the comparable figure. After direct labour the statements show 55.2%.
- Net margin
- 7.0%in band
- 0.0%median 5.0%10.0%
Source: Restaurant industry operating reports, 2026 · NAICS 722511 · secondary tier. Secondary-tier bands are usable as ranges, not as something a lender will read; where a figure has to survive scrutiny we substitute RMA Annual Statement Studies or IRS SOI data. Prime cost (food + labour) above ~65% of revenue is the standard red flag.
What they will ask first
A plan that answers these before they are asked reads as competent. One that does not gets sent back with them attached.
- What is your prime cost?
- Food plus labour as a share of revenue. Above about 65% the business does not clear its occupancy and debt service, and the reader knows the number before you say it.
- How many covers, at what average check, on what days?
- A weekday lunch and a Saturday dinner are different businesses. A single blended average hides the question a reader is actually asking.
Where these plans get sent back
Owner compensation set to zero
The most common silent failure. An underwriter substitutes a market salary and recomputes coverage, and the plan fails on their arithmetic rather than yours.
No seasonality
A flat twelve months signals a model built from an annual figure divided by twelve. Restaurants are seasonal everywhere.
Licences and filings to budget for
These belong in the use of funds, not in a footnote. A missing permit line is the cheapest possible reason to be sent back.
- Food service establishment permit and scheduled health inspections
- Liquor licence where alcohol is served — often the longest lead time in the whole build
- Certificate of occupancy, which sets the true opening month
- Employer registration, workers' compensation and payroll tax accounts
Requirements vary by state, county and city, and they change. Treat this as the list to go and verify locally rather than as legal advice — the product tracks the dated ones as configuration with a source and an effective date, and prints which version it assumed.
Start from these defaults, then make them yours.
The intake pre-fills this sector’s drivers and tags each one as your figure or an industry default — and says which in the finished plan.