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National Restaurant Association - Restaurant remodeling: Arm yourself for the battle of the budget

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Restaurant remodeling: Arm yourself for the battle of the budget



Ray's Boathouse in Seattle

Periodic renovations are essential to keep your restaurant up to date, but remodeling expenses can add up quickly, cutting into your profits. Follow these steps to keep your remodel budget in line.

● Prioritize your goals. Look at a remodel as a chance to explore your options. Strategize which are non-negotiable and which you can live without. “No one ever has enough budget to achieve all their goals,” points out restaurant consultant Aaron Allen, with Aaron Allen and Associates, headquartered in Orlando, Florida.

● Choose high-impact elements that deliver a big bang for your buck. Paint, finishes, lighting, landscaping and upholstery are just a few areas where you can make dramatic differences without a large capital investment. Even a simple deep cleaning can freshen up your look, advises Allen. Lisa Kong, a studio director and project manager for hospitality projects with the Los Angeles office of the Gensler design firm, notes that a feature wall at the entrance, highlighting a more expensive tile, can make your design pop, while keeping your budget contained.

● Limit infrastructure changes. “Budgets can get out of control when we start talking about plumbing and mechanical changes or moving walls,” says Kong.

● Keep your decor in line with your price point. A casual eatery with a $10 per person average check shouldn’t select pricy banquette fabric, even if the owner falls in love with it, says Kong. “If the check average is $100, then you can justify a more expensive fabric.”


Ray's Boathouse in Seattle

● Consider revenue-generating investments. Bars and private dining rooms are popular requests in remodels, says Kong, because they can boost your bottom line. Ray’s Boathouse in Seattle underwent an extensive renovation that included the addition of a 30-foot bar. “Alcohol has a much better profit margin,” says general manager Maureen “Mo” Shaw, who notes that the bar also changes the restaurant’s vibe and attracts a younger demographic. In a reimaging campaign, TGI Fridays, which has more than 900 restaurants in 59 countries, introduced a new design that elevates the bar experience, making it the center of activity.

● Factor in your closure. Budget for lost sales during any closure for renovation. To avoid opening delays, Shaw advises selecting every design item – down to furnishings – before starting the build-out. Scheduled for six-to-eight weeks, Ray’s remodel lagged on for 13 weeks, partly because some details weren’t hashed out. Schedule your remodeling wisely. Ray’s occurred over the holiday season, causing workflow delays, says Shaw.

● Leave some wiggle room. Budget for the unexpected. For example, you might need an extra coat of paint or could ensue overtime expenses to stay on schedule. This extra padding can help you launch your redesign within budget and on time, so that you can start to reap the rewards from your remodel.

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