How to Open a Restaurant in Louisiana

Louisiana's eclectic food scene is the perfect foundation for a new restaurant. Whether you want to specialize in a seafood boil or introduce new flavor combinations, your business will thrive here - as long as you complete a checklist to set operations in motion.

Even though the vibrant culture and tourism are prime locations for a restaurant, be reminded that this brings competition. Don't be scared; instead, use it as motivation to get this right and cover everything you can to ensure your restaurant is prepared to take on and ultimately beat the competition.

To set up your new venture in Louisiana for success, you've come to the right place. It takes a lot of research and planning to start a business, and restaurants are no exception. In this guide, we will cover everything needed to open a restaurant Louisiana will love including the initial steps of creating a business plan, marketing your brand, and training employees.

The Importance of a Restaurant Checklist

You have a great business idea, but you'll need to comply with Louisiana's local laws before you can implement it. Permits and licenses should be the top priority when opening a new business, whether it be a restaurant, cafe, or bar. For some extra guidance, resources from the Louisiana Economic Development for small businesses can help.

However, before you apply for every license and permit you come across, it's important to start the process with a business plan. Be as thorough as you can with your goals, potential challenges, and strategies to clarify what you will need permission for. 

For example, there's no reason to apply for a liquor license if your restaurant is alcohol-free. Or perhaps you applied for a license that isn't relevant in Louisiana, whatever it may be, it only leads to lost income, lost wages, and time that could've been spent on other restaurant operations.

In addition to business plans and legal documents, there are multiple other items to check off the list before opening day, including financing, hiring employees, and marketing, to name a few. For instance, you'll need to register your social security number as its required to validate other documents.

It may feel daunting to begin with, but getting everything organized, including the registration process for each permit and funding opportunity, sooner rather than later is key. Start on the right foot with everything in order, and your new business in Louisiana will start strong but, most importantly, maintain momentum long-term.

How to Start a Restaurant in Louisiana

1. Establish a restaurant concept

You won't get far without a restaurant concept. It should be the very reason why you're opening one in the first place and will influence almost everything about your establishment, from decor to menu to marketing.

A concept could be simple yet impactful, like a restaurant with comfort food that the people of Louisiana grew up with. Or, you can break boundaries and challenge the norm with inventive dishes and services that no one has experienced before.

Whatever you decide, it should not be an impulsive decision based on a whim. It needs to have longevity and practical solutions to common obstacles every restaurant encounters.

Here are some questions to ask yourself to help create a restaurant concept: 

What food and drinks will I serve and why?: This is one of the most important parts of a restaurant. A good menu is about two pages with a theme that aligns with the restaurant's overall concept. Have a purpose behind your dishes, and they will resonate with customers.

What is the local competition, and how will I stand out? You're bound to have other restaurants in the New Orleans area, so research them and find out how they conduct business. Use this to provide something they can't.

Who is my target market? It's important to know who you are trying to appeal to. This will guide your business decisions and be the difference between success and closure.

What will the service style be? This covers how customers will be served and how servers will be trained. For example, will it feel like old friends or strictly professional?

How many staff members do I need? Having too many employees wastes money and can make things run less efficiently. However, having too few team members results in slow, messy service, likely leading to high staff turnover rates.  

Toast’s Kitchen Display System (KDS) makes it easy to connect the front of house with kitchen staff to optimize service accuracy and efficiency.

What will the design of the business be? The overall physical appearance of your restaurant is what people will see first. It needs to appeal to the right people, be practical, and be consistent for branding purposes.

What are your business goals and values?

Finally, but certainly not of any less importance, you need to clearly understand your values, as these have the power to set you apart from the competition, appeal to the right target market, and ensure strategic business decisions.

Just like any other business, restaurants need a brand. Think of McDonald's or Taco Bell; these huge chains are consistent with their menu and messaging. This makes customers feel comforted that no matter where they go, they can rely on a restaurant such as this to provide the same experience each time.

Strong branding also plays a part in the quality of employee applications. If they resonate with your goals and values, it accurately represents their will to work hard at achieving a similar outcome. 

2. Make a restaurant business plan

Don't let the excitement of starting a restaurant in Louisiana make you rush the process. If you wing it and base each decision on panicked last-minute adjustments, it's almost guaranteed to be a disaster.

With your concept thoroughly planned out, it's time to put it into motion and apply it to a business structure. This involves specifying what business entity you will be, such as:

• LLC (Limited liability company)

• Sole proprietorship

• Partnership

• S corporation

• C corporation

For a better understanding of each one and their benefits and drawbacks, read our restaurant business entities guide.

Restaurants approach ownership and profit differently, for example, some establishments work best with just one owner while others have multiple.

As well as this, some owners give investors a stake in the business while others operate as a co-op, allowing every employee to own a stake.

If you are neither one nor the other, you can join the large pool of other businesses, including limited liability companies that operate somewhere in between. This typically involves owners and partners owning the business while employees share a small portion of the profit when the business does really well.

We should also note that a business name and a trade name are not the same thing, and you are required to establish one depending on the purpose.

This means that a business name is one you operate with when registering with the state's office or applying for insurance, while the trade name is reserved for branding.

This stage requires lots of thought and is best done alongside a lawyer or accountant to get the necessary paperwork and contracts. Their expertise will also provide the knowledge required to make the optimal choice for your business goals. To be supported every step of the way, you can get a registered agent who will receive documents and walk you through them.

3. Find Restaurant Funding

Businesses operate on funding regardless of the industry.

When opening a restaurant in Louisiana, you will need to choose the right type of business entity and ownership structure. If your legal entity is unsuitable, your personal assets could be at risk. Once this is done, you’ll need to secure funding for your business.

It costs anywhere between $95,000 and 2 million to start a restaurant, and very few people have that kind of money lying around. 

Some options available to restaurateurs looking to go into business in Louisiana include brick-and-mortar bank loans, financial institutions, SBA loans, merchant cash advances, lines of credit, crowdfunding, and turning to friends or family for financial support.

These funding options vary widely in application requirements, how much you can take out, what kind of collateral you’ll need, the type of repayment and the repayment schedule, and how quickly you can receive funding.

To learn more about each of these options, read more about restaurant financing and loans.  

Now, taxes are another thing you'll have to consider when organizing restaurant funding, starting with getting a business tax certificate.

The Internal Revenue Service (IRS) in Louisiana determines state taxes that include sales tax and state income tax, which may differ from federal tax, so check what's required and budget into your funding plan thoroughly.

4. Pick a Restaurant Location in Louisiana

Choosing the right location for your restaurant is critical. You’ll need to do research on the demographics, market, and competition in your location in Louisiana, as well as on the actual restaurant space and its size, visibility, and history. You could also opt to go location-free by becoming a ghost kitchen.

If you choose to have a physical location for your restaurant, you can either buy or lease restaurant space, or you can build your restaurant from the ground up. Here are some additional criteria to focus on when evaluating a restaurant location to decide if it's right for you:

• Target market and ideal customer profile

• Real estate market conditions

• Community

• Size of the site

• Previous tenants

Naturally, the location of your restaurant and the layout of the space should bring your restaurant idea to life. If you want to open an elegant steakhouse, you might need your own dedicated building. If you want to serve sandwiches or tacos to beach-goers, maybe a food truck will do.

It's important to keep in mind that your location and available square footage will also play a huge role in your kitchen design and restaurant floor plan.

If you envision creating a high-volume, fast-casual Italian concept with an exposed kitchen, for example, you will need a larger footprint and the ability to knock down walls and install proper ventilation. Some landlords may not let you have this leniency. 

5. Get Louisiana Restaurant Licenses and Permits

Like any other state, starting a business in Louisiana requires specific licenses and permits.

They aren't there to make things difficult; in fact, they make things easier for you in the long run. This includes having the basics needed to function like a business bank account, but it also lets you collect sales tax and have liability protection from things like property damage.

The licenses you’ll need to open a restaurant in Louisiana include:

1. Business License: Registers your business with local authorities, including the Louisiana Department of Revenue.

2. Certificate of Occupancy: Informs the state that your physical address and any additional business structures meet Louisiana's zoning and safety regulations.

3. Food Handler’s License: Also known as a Food Service License, it allows employees to serve food while implementing health and safety laws.

4. Seller’s Permit: This lets you collect sales tax on goods sold.

5. Liquor License Permit: Makes it legal to serve alcoholic beverages on the restaurant premises. Specific licenses can vary depending on the type of alcohol sold.

6. Food Facility Health Permit: Ensures you meet health and safety standards when storing, preparing, and serving food.

7. Building Health Permit: Your restaurant is recognized as clean and safe.

8. Employer Identification Number (EIN) allows you to hire employees and is required for tax purposes.

We understand it looks like a lot of documents, but with each online application, your business idea gets closer to being the real deal. Keep reading to learn what each permit and license does, why you need them, and how much they cost.

6. Develop Your Food and Drink Menu

You could have the comfiest seats or the best location, but a good menu is the foundation of your restaurant. Having quality food and drink will set you apart from competitors, attract the right customers, and, most importantly, keep them coming back.

It may not be as easy as you think to get a menu together as you need to consider multiple factors, such as your budget and what is practical for your kitchen.

Begin by referring to your business concept and plan. This will play a big part in what your menu includes. Stick to a theme that will cater to your audience, and try not to get carried away.

You can promise the best jambalaya in Louisiana, but it matters to deliver it consistently. Variety is great, but so is focusing on a small selection of dishes—quality over quantity.

Next, consider the budget. Especially when you start, money will be a bit tight before you make a profit month after month to pay off various business debts.

Find reputable wholesalers to provide cost-efficient, high-quality ingredients. To reduce waste and cost, use similar ingredients throughout the menu (without repetition).

Use Toast’s inventory management software to make better, real-time decisions regarding your ingredients. 

7. Hire and Train Employees

When hiring employees for your restaurant, ensure that you are complying with local city and county guidelines for state labor laws.

The employees that you hire are true extensions of your restaurant and its brand, making them one of the most important aspects of your restaurant’s success. From front-of-house servers to the chefs, there are dozens of restaurant positions you can hire for.

You have a few options for acquiring new restaurant employees, including referrals, job boards, and career sites.

In order to attract and retain staff, you need to make your restaurant a great place to work. Here are some resources from Toast to help you attract, hire, and retain restaurant employees:

• How to Be a Boss at Restaurant Recruiting

• How to Train New Restaurant Employees

• How to Reduce Restaurant Employee Turnover

8. Invest in the Right Equipment and Technology

It's essential to invest in restaurant equipment and technology that facilitates an off-premise dining experience that's equally as enjoyable as your in-house dining experience.

New Louisiana restaurants should strongly consider investing in the following:

• A cloud-based restaurant point-of-sale system

• An online ordering system for restaurants

• Restaurant reporting and analytics

• Simple scheduling and team communication

• A restaurant payroll solution

• Contactless payment options and order-and-pay-at-the-table technology make guests feel comfortable.

With this restaurant technology powering your business, your ability to grow revenue and establish yourself as a successful restaurant brand will be much easier.

9. Create a Restaurant Marketing Plan

Now, it's time to really get creative. Before you open the doors, it's important to get people excited about your Louisiana restaurant with a marketing plan.

It creates a buzz and informs people as to who you are, what you deliver, and why you deserve to be their pick for mealtime.

First things first, think about your brand messaging. This is how you will communicate with your audience regarding tone of voice and word choice. Once you decide on one that properly aligns with your goals and values, you must stick to it to be recognizable.

You must use the right social media channels to connect with your target market. Each platform attracts different demographics and interests; for example, TikTok is great for short-form content that quickly catches the attention of a young user base. Conversely, Facebook is used by an older user base and is better for organizing events and creating a community.

Email marketing is another great way to reach out to people. It keeps people engaged by sending monthly newsletters, promoting deals, or sending personalized recommendations for new menu items.

10. Host a Soft Opening and Grand Opening

You may wonder why you need to hold both a soft opening and a grand opening, but rest assured, each one has a purpose.

To make a select group of your audience feel special, invite them to a soft opening. This is held before the grand opening and allows for small, important groups of individuals to get introduced to your Louisiana restaurant on a more intimate level. It also helps to pinpoint things that need polishing before the official opening.

A soft opening can be a cookout on the restaurant's patio with a family vibe or a formal menu-tasting session. Having discount prices is a great way to ease into the real deal.

A grand opening is when the entire Louisana public and beyond are welcome to the restaurant. Use your marketing channels to promote the opening and advertise special additions like live music or giveaways to get people in the door.

What's Next for Your Louisiana Restaurant?

Congratulations! You have completed the steps required to start a business in Louisiana. It wasn't easy, but it was worth it, and now it's time to focus on managing this successful endeavor.

Explore Toast's resources for new businesses in the food industry to streamline the process of opening and running a restaurant.

Remember, a solid restaurant concept and business plan are top priorities when starting out. They will be your foundation, guiding every decision from that point onwards.

Then, the paperwork starts to build a legal structure to cover all areas of the restaurant. Business licenses are mandatory for your restaurant, but other circumstances require you to decide what is necessary for your particular establishment, such as choosing between business entities and ensuring proper registration with the Louisiana Secretary of State.

As the soft and grand opening looms around the corner, there's no reason to panic, as everything is in place for your new restaurant in the brilliant, vibrant Louisiana state to make waves in the industry.

FAQs

How much does it cost to open a restaurant in Louisiana?

The cost to open a restaurant in Louisana will vary depending on the scope of your concept. In general however, you can expect to spend anywhere between $95,000 and 2 million. As you can see it quickly jumps to unaffordable heights without proper funding in place. This is why small businesses should register for financial opportunities wherever possible.

What permits do I need to sell food in Louisiana?

As well as the basics, such as a business license and registering with an entity such as a sole proprietorship, you will need the following:

• Food Handler's License

• Food Facility Health Permit

• Building Health Permit

• Seller's Permit

• Liqour license permit (if you wish to sell alcohol too)

How much is a food license in Louisiana?

The type of permit you have will influence its cost. A food handler permit costs up to $15 per employee and cannot be any higher due to Louisiana's state laws. A food safety certificate is a bit more expensive at $25.