What You Should Know Before Starting a Restaurant Business in India

Starting a restaurant in India is a great way to capitalise on the country’s growing economy and rising consumer demand.

India’s food service market to reach $79.65 billion by 2028. With so much potential and opportunity, it is no wonder that entrepreneurs are looking to start their own restaurant in India.

However, before jumping into the restaurant business, there are a few important things to consider.

Key Regulations and Laws

Key Regulations and Laws for Starting a Restaurant Business in India

Obtaining Licenses and Permits: All restaurants in India require multiple licenses and permits prior to opening their doors to customers.

Most states require a food license to start a restaurant, while some also need special permits such as: a health license, a trade certificate, a restaurant license, a liquor license, etc.

Complying with the Building Codes: The local government has numerous regulations for restaurants, starting from the building codes such as fire safety, waste disposal, electrical safety and so on.

Getting the Login ID and Registering on FSSAI website: The Food Safety and Standards Authority of India (FSSAI) is an organization responsible for regulating food safety standards and laws in India.

Before starting a restaurant, one must obtain a login ID from the FSSAI website, and then register the restaurant.

Adhering to the Food Safety and Hygiene Norms: All restaurants must adhere to the food safety and hygiene norms prescribed by the Food Safety and Standards Authority of India (FSSAI).

This includes having a trained food safety supervisor, preparing food according to hygienic standards and completing all paperwork needed.

Proper Staff Training: Restaurants must also provide their staff with in-depth training on all safety and hygiene rules, food storage and handling procedures, customer service requirements and so on.

Registering with Local Tax Authorities: Setting up and running a restaurant also requires registering with local tax authorities and filing various taxes such as GST and other taxes as applicable.

Registering the Restaurant’s Name: To ensure that no one else uses or imitates the brand, the restaurant’s name needs to be registered with the Registrar of Companies for legal protection.

Navigating Food Licensing and Hygiene Guidelines for Restaurants in India

Hygiene is an essential requirement in any restaurant business in India. Customers expect clean and hygienic food and environment in the restaurant.

Poor hygiene can lead to food-borne illnesses and other health hazards.

Therefore, it is important for restaurants to maintain high standards of hygiene in order to provide safe and healthy food to customers.

  1. Check with your local municipality to determine the specific laws and regulations that apply to your restaurant.
  2. Obtain the necessary permits and licenses from the necessary authorities. These will likely vary depending on whether you’re serving alcoholic beverages or not.
  3. Secure a food safety license, which is generally issued by the local municipal corporation. The license is necessary to prove that your restaurant meets the health and hygiene standards of the Food Safety and Standards Authority of India.
  4. Ensure that the restaurant has proper infrastructure and hygiene systems in place. This includes adequate ventilation, clean surroundings, and a separate staff entrance and exit to minimize contamination.
  5. Construct a separate area for storing food and ingredients. This should be away from other areas of the restaurant and well-ventilated.
  6. Hire experienced chefs who are aware of the food safety and health standards in India.
  7. Source fresh, unadulterated ingredients from reliable vendors.
  8. Maintain a documented record of purchases from vendors, including date and quantity of purchase.
  9. Implement a HACCP program to ensure safety and food quality.
  10. Follow proper sanitation and hygiene standards at all stages of food preparation and storage.
  11. Invest in safety and hygiene equipment such as thermometers, hot plates, weighing machines etc.
  12. Make sure all cooks and servers wear hair nets, gloves, head covers and clean aprons.
  13. Develop sanitation routines and hire an experienced sanitation team.
  14. Educate staff on food safety and hygiene standards in India.
  15. Have an audit system in place to ensure ongoing compliance with health and hygiene standards in India.

How to Market and Promote a Restaurant in India

  1. Create a Website: Build a website for your restaurant that serves as the main hub of information for your brand. Make sure your website is well designed, easy to navigate, and convenient for customers to book tables and view your menus.
  2. Leverage Social Media: According to a study by GroupM, Indians spent 2.6 hours on average every day on social media in 2018, which makes social media platforms the perfect platform to promote your restaurant. Use platforms like Facebook, Instagram, and Twitter to engage potential and existing customers.
  3. Run Online Ads: You can use popular search engines like Google and Bing to run ads to promote restaurant in India. These ads allow potential customers who are searching for restaurants or food near their location to find your restaurant easily.
  4. Use Influencer Marketing: Influencer marketing is one of the most powerful ways to market and promote your restaurant in India. Find influencers within your niche who’re already popular and have a wide reach, and collaborate with them to promote your restaurant.
  5. Utilize Local Coverage: Local journalism (print or digital) is an effective way to reach local customers and make them aware of your restaurant. You can also utilize local radio and TV channels to highlight your food and promote upcoming events or offers.
  6. Offer discounts and promotional offers: Provide discount vouchers and special offers on complete meals and appetizers, free drinks and desserts for students, and other coupons for online orders. This will attract customers and get them to visit the restaurant regularly.
  7. Create a loyalty program: Offer discounts and special offers to regular diners and encourage them to come back. This will help in increasing brand familiarity and customers’ loyalty.
  8. Organize events: You can organize various events like cooking competitions or quiz programs, or offer discounts on certain days. This will help your restaurant score better visibility and word-of-mouth publicity.
  9. Join forces: Partner with nearby stores and local businesses to offer joint promotions and deals. This can help in generating more attention for the restaurant.

Finding the Right Location for Your Restaurant Business

  1. Understand your target market: Before deciding on a location for your restaurant business in India, you must know your target market. Consider factors such as demographics, income level, and local preferences when analyzing potential locations.
  2. Identify available permits and regulations: Make sure you understand the relevant regulations in each location of interest before beginning the process of setting up your restaurant. Consider local zoning laws and any permits or licenses required in order to operate a restaurant in the area.
  3. Consider the cost of the site: Evaluate the cost of the site compared to competitors in the area, and consider the potential return on investment that the location will provide.
  4. Calculate proximity to suppliers: Calculate the distance between the potential site and nearby suppliers. This can help you determine if regular supply runs will be feasible and help you strike a balance between convenience and cost.
  5. Analyze access to transportation: Evaluate the accessibility of the location compared to roads, public transportation and other infrastructure. This can help give you a better understanding of how well your restaurant can be accessed by customers.
  6. Consider the competition: Consider the competition that is already established in the area. Try to identify how you can differentiate yourself from other restaurants and what advantages or disadvantages the area may offer.
  7. Communicate with local stakeholders: Talk to local stakeholders such as restaurant owners in the area to gain an understanding of any potential challenges or opportunities that may arise.
  8. Measure visibility: Measure visibility by identifying how well the potential location is seen from the road or from nearby pedestrian traffic. Consider factors such as street lighting, existing signage and overall foot traffic.
  9. Analyze potential for growth: Identify potential for growth in the area, such as the potential for adding menu items, expanding the restaurant’s seating capacity.
  10. Reevaluate and refine: Once you identify a few potential sites, take some time to reevaluate and refine your options before making a final decision. Ensure that you have thoroughly compared all of your options and have analyzed all of the relevant factors.