How to Open a Restaurant in Hawaii

Are you preparing to open a restaurant in Hawaii? We know it's a big commitment for first-time business owners, so we've created a simple, comprehensive guide specific to opening a restaurant in Hawaii. 

This process involves many different components where guidance can be useful, from the initial business concept to the grand opening. Key steps include developing a clear business plan and making sure you have sufficient financial means to get things up and running. 

Once these high-priority tasks are completed, you can move on to the many pieces of paperwork, including restaurant licenses, permits, and certifications. Hawaii has its own set of permits, standards, and laws regarding public food safety, the sale of liquor, business registration, labor, and other aspects of restaurant operations. 

A hopeful restaurant opener in Hawaii may need a few words of advice on launching their new business. So, we’ve created a step-by-step guide for you to take full advantage of.

Read on to learn more about opening a successful Hawaii restaurant — whether you’re dreaming up a sushi bar in Lahaina, a fine dining experience in Hilo, or a beachfront coffee bar in Honolulu.

How to start a restaurant in Hawaii

1. Refine your restaurant concept

What kind of restaurant have you been imagining? Take all your ideas off the shelf and consider the merits of each one. The following prompts can help you draw out the essence of your concept, turning the ideas into a viable, functional business with the potential to thrive:

• What types of dishes will you serve? Will your menu focus on a specific cuisine or a creative fusion?

• What service style will you offer? Will your restaurant provide full table service, be takeaway-focused, or a combination of both?

• What scale of business are you aiming for? Are you envisioning a small, family-run restaurant or a larger operation with potential for expansion?

• Who is your target audience? What types of customers are you aiming to attract, and what will they be looking for in your restaurant?

• How will you differentiate from competitors? Are there similar restaurants nearby, and how will your concept stand out to bring in more diners?

• What kind of team will you hire? Will they be trained to provide warm, casual service or a more formal, refined dining experience?

• What will your restaurant’s atmosphere be like? Consider the overall design—the colors, decor, furniture, and ambiance you want to create.

Your mission, values, and their role in your business

Reflecting on the core values you want to embody through your business can guide you through the complexities of the planning phase. These values will shape your broader mission and influence decisions around hiring practices and brand development.

Once your concept has taken shape, you can move on to the fun part—choosing a business name and logo for your restaurant. Visual representation plays a significant role in how customers perceive your brand, providing an opportunity for you to bring your ideas together in one design or symbol.

2. Create your restaurant business plan

A well-structured business plan is crucial for any new venture. It serves as a roadmap to guide you toward running a successful Hawaii restaurant.

Start by determining the legal structure for your business entity. Some options you can register as include an LLC, partnership, sole proprietorship, or an S or C corporation. If you're unsure which entity is right for you, check out our guide on restaurant business entities, which outlines the advantages and drawbacks of each option.

Each restaurant will take an individual approach to the business element of ownership and profits. Some may operate simply with a sole owner and many employees. Others take on investors to expand their financial capital. Others will become a co-op by providing employees with a small share of profits or similarly offering their investors a stake in the business.

Many businesses combine a balance of the previous models, with owners taking responsibility and employees sharing profits at a specified revenue point. You will need to figure out what ownership and profit-sharing situation best suits your restaurant. It is recommended that you seek advice from a lawyer and accountant to draft your contracts and other paperwork.

Your business plan will encompass all of this information, along with the following key elements that will shape how your restaurant operates:

• Executive summary: Include the name of your restaurant and a brief overview of the business.

• Company overview: Provide details about your business model and concept.

• Industry analysis: Examine your target market, location, and nearby competitors.

• Financial analysis: Outline your investment plan and financial projections, such as the break-even point, anticipated cash flow, and estimated costs.

• Operations plan: Detail your staffing needs, customer service policies, payroll plan, and which point-of-sale system and vendors you’ll use for supplies.

• Business model and service style: Clarify whether your restaurant will be quick service, fine dining, fast food, or a sit-down establishment.

• Marketing plan: Describe how you plan to promote your restaurant and attract customers.

3. Finance your Hawaii restaurant

The baseline cost of opening a restaurant can vary from $95,000 to $2,000,000, a significant amount of money for most people to acquire over a short period of time. 

Restaurateurs in Hawaii have multiple financing options. These include traditional bank loans, SBA loans, alternative financing, merchant cash advances, lines of credit, crowdfunding, or backing from friends and family. Each loan format comes with a different set of application criteria, loan amounts, collateral requirements, repayment schedules, and processing periods.

Research thoroughly to establish which financial strategy fits your goals and needs best. You can start the process by reading our guide on restaurant financing and loans.

4. Choosing your Hawaii location

Hawaii has much to offer in terms of location, and it's important you pick the right space for your restaurant. Before locking into your final choice, start researching the restaurant market, demographics, and competition in the surrounding area. You'll also need to know the square footage, layout, and visibility before committing to anything.

When deciding to buy, lease, or build your restaurant space, each option comes with its own challenges and influences the amount of startup capital needed. If you're constructing a new space or renovating an existing one, you may also need to undergo a plan review to ensure the project complies with local regulations.

We've put together some other important aspects to help you determine the right location for your future restaurant:

• Size of the space

• Surrounding community

• Real estate market conditions

• Previous tenants

• Previous usage of the space

• Target market and ideal customer profile

• Zoning

Select a space that enhances your concept and individual brand. Different sizes and structures of building will suit different restaurants. For example, a coffee shop may suit a small, cozy corner store space, whereas a pizzeria focused on group bookings will fit a larger, open plan venue.

5. Acquiring Hawaii Restaurant Licenses and Permits

Hawaii is like all other states in that it requires every business entity to hold necessary licenses and permits to operate. Opening a restaurant is no exception, with some permits provided by the state and others managed by your city or county departments. Here's a list of some of Hawaii's most important restaurant regulations.

Some Hawaii licenses and permits required to open a restaurant include:

1. Employer Identification Number (EIN), which connects your business to the IRS. You can apply online using the IRS website, which provides all the relevant instructions.

2. Hawaii requires you to register your business with the Department of Commerce & Consumer Affairs.

3. Food Permit Applications, which are issued by each of Hawaii’s counties. You can find the application forms other resources on the Department of Health Food Safety Branch website.

4. Liquor License, which is provided by Hawaii's Department of Liquor Control. The application form and renewal process are found on the Liquor Control website.

5. Food Handler Certificate, which must be held by at least one person in your restaurant during all operational hours. Hawaii's Department of Health (DOH) offers a free food safety education course, that is located on the Food Safety Education website.

6. Building permits, otherwise known as a certificate of occupancy. You will need to visit your county or city website to locate the relevant steps, fees, and contacts for obtaining your building permit.

We have written a more detailed guide which is available now for restaurateurs to explore, explaining Hawaii's permits, license fees, and license costs.

6. Food and Beverage Program

Create your menu either independently or in collaboration with an experienced general manager or chef-owner. After your kitchen and bar staff are fully trained for service, be ready to fine-tune your offerings based on customer feedback.

Make sure your menu includes distinctive dishes that set your restaurant apart from competitors while also being priced to maximize profitability.

We've also created guides that focus on menu design and menu engineering to help you better understand how to optimize the flavors and presentation of every dish that leaves the kitchen.

7. Recruiting Restaurant Staff

Hawaii has a clear set of labor laws, which are a high priority for any employer to understand when seeking to hire staff. Your local city or county may have its own regulations, so make sure you thoroughly investigate all avenues regarding hiring, training, and compensating your employees.

A strong service team will be integral to the reputation and atmosphere of your restaurant. Your front-of-house staff will welcome guests and care for them during their visit. Your kitchen crew will prepare quality meals, and support staff are essential to make sure everything else runs smoothly. As you begin the hiring process, you may be surprised at the wide variety of roles your restaurant will need to fill.

New talent is out there, and you have several options to help find it. You may leverage your personal or professional network, utilize media platforms such as Instagram and Facebook, connect with hospitality graduates, or post jobs on digital recruitment sites.

To find and keep quality talent, you need to create a desirable work environment. By providing competitive pay and meaningful benefits, such as health insurance, you can help your restaurant stand out as an attractive employer.

We have developed a suite of resources to help you find, train, and manage a highly effective team of restaurant staff:

• How to Train New Restaurant Employees

• How to Onboard a New Restaurant Employee

• How to Be a Boss at Restaurant Recruiting

• How to Reduce Restaurant Employee Turnover

To learn more about the recruitment process, explore our video course on hiring and retaining restaurant employees. 

8. Selecting Restaurant Technology

With the grand opening drawing near, it's time to consider your restaurant technology options. Spending money on the right combination of products and equipment will build consistent, effective systems to support staff, customers, and overall business performance.

New restaurant owners are strongly encouraged to invest in the following variety of systems:

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

• Contactless payment options

• A restaurant loyalty or rewards solution

• An online ordering system for restaurants

• Kitchen display screens

• A restaurant payroll solution

• Restaurant accounting software

• Restaurant reporting and analytics

• Restaurant inventory management software

• Simple scheduling and team communication

Effective restaurant technology runs seamlessly in the background, supporting operational tasks and tracking key insights into your business's health and performance. With this information at your fingertips, you can make informed decisions that enhance revenue and continue your restaurant's success.

9. Marketing Your New Restaurant

In Hawaii's vibrant food culture, any upcoming restaurant needs an effective marketing plan. If you're already established, word of mouth can be an effective way to get people through the door. When starting out, however, you need to connect with your target customers via different channels. Social media, email marketing, and mailouts can help engage with your future regulars.

Restaurant marketing is something every owner needs to spend some time and effort on. We've created a series of resources to help you come up with a valuable, effective strategy.

Explore our marketing plan template, our social media guide for restaurants, and our guide to restaurant email marketing.

10. Opening Your Restaurant

With everything in place, it’s time for a soft opening. Invite family and friends, and encourage your staff to do the same, so you have a full house to trial run your very first restaurant service. This way, you have an opportunity to iron out any issues that crop up before the official opening gets underway.

With the soft launch complete, you can focus on planning and promoting the grand opening. Spread awareness on social media, hand out flyers in the neighborhood, and ask your network to help get the word out. This will build anticipation and draw a crowd, allowing you to finally showcase the hard work you’ve put into your restaurant.

FAQs

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

Opening a restaurant involves a significant start-up cost, which varies depending on your business concept and location. Typically, a new restaurant will cost between $95,000 and $2 million to open. As this is a significant sum for most people, it's advised that small businesses take advantage of any funding or subsidies available to them.

How much is a Hawaii food handler's license?

A food handler's license (known as a food handler card) varies depending on the level of training. Food handler permits cost up to $10 and can be completed online or in person. Hawaii's government offers a comprehensive list of approved training providers on their food safety website.

What permits do I need to sell food in Hawaii?

Besides registering your entity (e.g., partnership or LLC) and connecting your business with the IRS, other licensing requirements include:

• Food Establishment Permit

• Food Handler Certification

• Liquor License (if you wish to sell alcohol)