By continuing you agree to eChinacities's Privacy Policy .
Sign up with Google Sign up with FacebookQ: What are the steps (and pitfalls) to opening up a cafe or restaurant in China?
How much would you need as startup investment, do you absolutely need a Chinese partner, how do you go about selecting the location and claiming it, what is one's 'company' registered as, etc.
Basically I want to know just how feasible this truly is.
12 years 13 weeks ago in Business & Jobs - China
It is very possible, it will take you to become more familiar with Chinese regulations so you can have a sound business do. It is far too long to give you all angles here in detail, but I will touch briefly some of them. Do use Google and find further details.
I have known a few fellows that opened bars and restaurants (not too large) for between 100K and 200K Rmb. In fact, I do know of a couple of them locally for sale at 200K and 300K now, price negotiable do.
If you do open one, basically there are two ways, you have one Chinese partner, he owns 51%, and you 49%; in paper he is your boss, but that will give you the residence permit and work permit required. Of course, you must legally cover yourself with documents protecting your investment, and the lack of investment by your Chinese partner. OR, you can register a fully own foreing corporation with 100K Rmb of capital, be sole owner, get your work documents also, and have no partner at all. Do require in both cases for you to be aware of labor law requirements, and do file income tax returns. One example of requirements, if you hire female waitresses, you must provide free of cost to them a place to sleep.
Selecting the location is not complicated. Depending on what you wish to open, probably need a good foot traffic, room to park cars and bikes, and enough square meters of building to satisfy your present needs, leaving also room for expansion. Once you find the location you desire (look at buildings being constructed), locate owner of building and discuss rent conditions. If acceptable, do sign contract, but have legal counsel first. I do know the rent paid by a local restaurant located on floor level of a nice hotel, it is 20,000Rmb per month. And it is owned by a laowai.
If opening a franchise, then must negotiate franchise rights first. If no a franchise, just go ahead with your idea. Check inmediate area to see if other established business will compete with you. I am sure that whatever you open, if succesful, soon a Chinese will open a similar one next door to you.
Then you must have a darn good cook, and staff that do provide a very good service (must train them), and prices should be competitive. Too high prices will keep people away. If a restaurant, must get a service to supply you with clean dishes in a plastic wrap, chinese dislike and do not trust restaurants who clean their own dishes and chopsticks. To build up a client base of regulars, do offer at the beginning inducements for repeat visits, like a 10 % discount on bill for next time, or similar. A lot of aqdvertisements, hand outs at nearby intersections, etc is also a good idea. A website with photos of customers dining and having fy=un helps to draw repeat business.
And many more small details also.