Opening a Chinese restaurant can be a lucrative and rewarding business opportunity. With the growth of the world’s population and the increasing number of people consuming Chinese cuisine, the demand for Chinese restaurants continues to rise. According to a report by Statista, the global Chinese restaurant market size was valued at $107.71 billion in 2020 and is expected to grow at a CAGR of 4.3% from 2021 to 2028. Starting a Chinese restaurant business is not an easy task and requires significant dedication and effort. In this blog post, we will provide you with a simple 10-step checklist for opening a successful Chinese restaurant business that will help you in your journey towards entrepreneurship.


1. Research The Market Demand And Competition.

The first step towards starting a Chinese restaurant business is to research the market demand and competition. Here are some tips to help you with your research:

Tips & Tricks:

  • Check out the competition in your area. Visit other Chinese restaurants and note their menu items, prices, and customer service. Determine what sets your restaurant apart from the competition.
  • Research the demographics of your location. Determine if the population is diverse and if there is a demand for Chinese food. You can also conduct market research to gauge customer interest in your restaurant.
  • Consider partnering with a restaurant consultant. A consultant can provide valuable insights into the industry and help you develop a business plan.

Once you have conducted thorough research on the demand for Chinese restaurants in your area, you can move on to the next step of starting your business.


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Create A Solid Business Plan And Financial Model

Before you start your Chinese restaurant business, you must have a solid business plan and financial model in place. This will help you understand the market, the competition, and your own business aspirations. Here are the essential chapters to include in your plan:

  • Executive Summary - Brief description of your business and the key points of your plan
  • Business Description and Mission Statement - Detailed description of your Chinese restaurant and the mission statement that defines your purpose
  • Market Analysis - Overview of the industry, target market, competition, and the marketing strategy you will use
  • Menu Planning and Food Costing - A complete menu with pricing, recipes, and food costing to determine the cost of goods sold
  • Organization and Management Team - The structure of your restaurant, roles and responsibilities of each team member, and the management philosophy you will follow
  • Financial Plan and Projections - The financing you need to start your business, sales forecast, expense budget, and projected income statement, balance sheet, and cash flow statement
  • Risk Assessment - Potential risks that your business may face and the strategies you will implement to mitigate them

Once you have created a comprehensive business plan, move on to developing a financial model. This model will help you make informed decisions on how to allocate resources, monitor financial performance, and secure funding from investors. Here's what you should include:

  • Sales Forecast - Estimate of the number of customers and sales figures you will generate
  • Expense Budget - Detailed account of your expenses, including fixed, variable, direct, and indirect costs
  • Income Statement - A summary of your revenue and expenses over a period of time, such as a month or a year
  • Balance Sheet - A snapshot of your assets, liabilities, and equity at a given point in time
  • Cash Flow Statement - A projection of how much cash you will have on hand and when it will be available

Tips & Tricks

  • Consult with a financial advisor or accountant to ensure your financial model is accurate and realistic
  • Research the tax laws and regulations in your area to avoid any surprises down the line
  • Use business plan and financial model templates available online or through professional organizations to save time and effort

Creating a business plan and financial model may seem like a daunting task, but it's an essential step in starting a successful Chinese restaurant business. It will not only help you understand your market and financial prospects but also give you confidence in presenting your business to potential investors, lenders, and partners. Take time to create a comprehensive plan and model, and you'll be on your way to a successful launch.



3. Decide On The Restaurant Location And Concept.

Choosing the right location and concept for your Chinese restaurant business is essential to its success. You want to make sure you are located in an area that has a high concentration of potential customers and that your concept appeals to them.

  • Research Locations: Conduct market research to determine the areas with high Chinese population, tourist areas, or commercial districts. You should look for a location with high foot traffic and easy access to transportation.
  • Determine Your Concept: Will your restaurant be a classic Chinese restaurant, a fusion of Chinese and other cuisine, or a specialty restaurant, such as Dim Sum or Hot Pot? Think about what sets you apart from your competitors and what will appeal to your target market.
  • Consider Your Budget: The location and concept you choose will affect your budget. High traffic areas tend to have higher rent and operating costs. Specialty concepts may require expensive equipment or unique ingredients. Consider your budget before deciding on a location and concept.

Tips & Tricks:

  • Consider opening your Chinese restaurant business in an up-and-coming neighborhood to take advantage of lower rent costs. You may be able to attract customers who are looking for new dining options.
  • Survey potential customers in the area to gauge their interest in your concept before finalizing your plans.
  • Try to choose a location that is easily accessible and visible from the street to attract foot traffic and increase brand awareness.

Once you have chosen your location and concept, you can start developing your restaurant's design and menu. Your restaurant should reflect your concept and appeal to your target market.

  • Develop Your Menu: Your menu should reflect your concept and offer a wide variety of dishes that appeal to your target market. Consider offering both vegetarian and meat options to attract a wider range of customers.
  • Create Your Restaurant's Design: Your restaurant's design should reflect your concept and create an inviting atmosphere for your customers. Pay attention to lighting, color schemes, and furniture to create a cohesive look.
  • Obtain Necessary Permits And Licenses: Consult with your local zoning and health department to obtain the necessary permits and licenses for your Chinese restaurant business. This can include foodservice licenses, liquor licenses, and permits for outdoor seating or signage.

Choosing the right location and concept for your Chinese restaurant business is just the beginning. With careful planning and attention to detail, you can create a successful and profitable enterprise.



4. Secure Necessary Permits And Licenses.

One of the crucial steps to starting a Chinese restaurant business is to secure all the permits and licenses needed to operate legally. This would vary depending on your location and state, but generally, these are the permits and licenses that you should obtain:

  • Business License: This is a standard license required for all businesses to operate legally.
  • Food Service Permit: This is a permit from your local health department, which ensures that your business meets all the necessary health regulations.
  • Liquor License: If you plan on serving alcohol, you should obtain a liquor license from your state ABC (Alcoholic Beverage Control) board.
  • Permit For Signage: If you are planning to install a signboard outside your restaurant, you may need to obtain a permit from local authorities.
  • Employer Identification Number (EIN): This is required if you plan on hiring employees for your business.

The process of obtaining permits and licenses can be quite tedious and time-consuming. However, getting it right the first time can save you from legal issues and fines down the line. It is therefore essential to research on the specific permits and licenses required in your location, compile all the necessary documents, and apply for those permits and licenses at the respective government agencies.

Tips & Tricks:

  • Research online on the permits and licenses required in your locality before starting the process.
  • Compile all the required documents before applying for permits and licenses to avoid back and forth with the application process.
  • If you are hiring employees, it's best to provide them with an employee handbook that includes information on your company's policies, procedures, and compensation plans.

Once you obtain all the necessary permits and licenses, display them in a visible location within your restaurant. This shows that your business is operating legally, and it can create trust and confidence in your customers.

In summary, securing all the permits and licenses required for your Chinese restaurant business before opening is paramount. This allows you to avoid legal issues and fines and ensure that you operate your business legally.



5. Buy Or Lease Equipment, Furniture And Supplies.

Choosing the right equipment, furniture, and supplies is essential for starting a successful Chinese restaurant business. Here are some steps to ensure that you are purchasing high-quality equipment and supplies at reasonable prices:

5.1 Determine Your Needs

  • Make a list of all the equipment you will need to run your restaurant, including cooking appliances, refrigeration, sinks, dishwashers, and furniture.
  • Consider the size of your restaurant and your menu when purchasing equipment.
  • Make sure to purchase high-quality equipment that will last for many years, and choose items that are energy-efficient to save money on utility bills.

5.2 Research Equipment And Supply Vendors

  • Look for vendors that specialize in restaurant equipment and supplies.
  • Compare prices and read reviews from other restaurant owners.
  • Consider purchasing used equipment or leasing equipment if you are on a tight budget.

5.3 Negotiate Prices and Terms

  • When negotiating with vendors, always ask for a lower price or additional discounts.
  • Ask about financing options if you are planning to lease equipment.
  • Make sure to read the terms and conditions of all contracts and agreements before signing.

5.4 Pay Attention to Details

  • Make sure that all equipment and furniture meet local health and safety codes.
  • Consider purchasing warranties or maintenance contracts for your equipment.
  • Ensure that all supplies, such as dishes, utensils, and napkins, are of high quality and match your restaurant's theme.

Tips & Tricks:

  • Consider purchasing equipment and supplies from online vendors for a wider selection and potentially lower prices.
  • Don't forget to factor in delivery and installation costs when budgeting for equipment and supplies.
  • Ask other restaurant owners for recommendations on equipment and supply vendors.



6. Hire And Train Staff.

Hiring and training staff is crucial to the success of any business, and a Chinese restaurant is no exception. Your staff is the face of your restaurant, and customer satisfaction heavily relies on good service. Here are some steps to follow when hiring and training staff for your new restaurant:

  • Create job descriptions and requirements: Decide what roles you need to fill, such as servers, cooks, cleaners, etc. Write clear job descriptions outlining the specific responsibilities and requirements for each role.
  • Advertise the job openings: Post job ads on local job boards, newspapers, social media, and your restaurant website. You can also try hiring through staffing agencies or job fairs.
  • Conduct interviews: Review resumes, invite qualified candidates for an interview, and ask relevant questions to assess their skills, experience, and personality. Consider doing a trial shift to see how they perform under real conditions.
  • Train the staff: Once you have hired the right people, provide them with adequate training. This should include orientation to your restaurant policies, operations, menu, and customer service. You may also need to train them on food handling and safety standards.
  • Set performance standards: Establish clear expectations for your staff's performance and behavior. This should cover punctuality, dress code, communication, teamwork, and dealing with difficult customers. Provide regular feedback and encourage continuous improvement.

Tips & Tricks:

  • Hire for attitude, train for skills: Look for candidates who have a positive attitude, strong work ethic, and willingness to learn. You can teach them the specific skills needed for the job.
  • Cross-train your staff: Consider rotating your staff to different roles to broaden their skills and knowledge. This can also help in case of emergency situations or staff shortages.
  • Reward good performance: Recognize and reward your staff when they perform well, such as giving bonuses, promotions, or paid time off. This can boost morale and motivate them to do even better.

By hiring and training the right staff for your Chinese restaurant, you can ensure that your customers have a pleasant and unforgettable dining experience. Remember that the quality of your service can make or break your business, so invest time and effort in building a strong team.



7. Develop A Menu And Source Quality Ingredients.

Developing a menu and sourcing quality ingredients are crucial aspects of opening a successful Chinese restaurant. A well-crafted menu that offers variety and unique dishes can attract customers and keep them coming back for more. Here are some steps to take when developing a menu:

  • Research the market and analyze the demand for Chinese cuisine in your area. Take notes about what your competitors are offering and how they price their dishes.
  • Decide on a theme for the restaurant and build your menu around the theme. For example, you could have a Sichuan-style restaurant that focuses on spicy dishes or a dim sum restaurant that offers small plates.
  • Create a menu that offers a variety of dishes to cater to different tastes and dietary restrictions. Include vegetarian and gluten-free options if possible.
  • Price your dishes reasonably to attract customers but also make a profit. Keep in mind the cost of ingredients, labor, and overhead expenses.

Sourcing quality ingredients is another essential part of opening a successful Chinese restaurant. Using fresh, authentic ingredients can make a big difference in the taste of your dishes. Here are some steps to take when sourcing ingredients:

  • Find reliable suppliers that specialize in Chinese ingredients. Ask for samples and compare prices to find the best quality ingredients for your budget.
  • Visit local Asian markets or grocery stores to find unique ingredients that may not be available from your suppliers.
  • Stay up-to-date on food trends and ingredients that are popular in China to offer unique and exciting dishes on your menu.
  • Train your cooks to handle and prepare ingredients properly to ensure consistency and quality in your dishes.

Tips & Tricks:

  • Offer a seasonal menu that changes every few months to keep customers interested and coming back.
  • Build relationships with your suppliers to negotiate better prices and deals.
  • Create a signature dish that sets your restaurant apart from others in the area.



8. Build A Strong Online And Social Media Presence.

One of the most important elements of starting a Chinese restaurant business is establishing a strong online and social media presence. This will allow you to attract and engage with potential customers, build your brand, and ultimately drive revenue. To build a strong online and social media presence, you should:

  • Create a website: Your website should be easy to navigate, feature high-quality images of your food and restaurant, and include your menu, hours of operation, and contact information. It is also important to ensure that your website is optimized for search engines so that potential customers can find you easily.
  • Utilize social media: Social media can be a powerful tool for promoting your restaurant and engaging with customers. You should create accounts on platforms like Facebook, Instagram, and Twitter and regularly post updates, promotions, and images of your food. It's also important to respond promptly to customer inquiries and reviews.
  • Offer online ordering: Many customers prefer the convenience of ordering food online. By offering online ordering, you can increase sales and streamline the ordering process for your customers.
  • Create a loyalty program: A loyalty program can help you build a loyal customer base and increase repeat business. Consider offering discounts, free meals, or other rewards to customers who visit your restaurant frequently or refer others to your establishment.
  • Monitor your online reputation: It's important to monitor your restaurant's online reputation and respond quickly to any negative reviews or comments. By addressing customer complaints in a timely and professional manner, you can demonstrate that you value your customers' opinions and are committed to providing excellent service.

Tips & Tricks:

  • Consider hiring a social media manager or digital marketing expert to help you develop and execute a comprehensive online marketing strategy.
  • Encourage customers to leave reviews on popular review sites like Yelp, Google, and TripAdvisor. Positive reviews can help attract new customers and improve your search ranking.
  • Use eye-catching visuals, such as high-quality photos and videos, to showcase your food and restaurant on social media.



9. Identify Potential Funding Sources.

Starting a new restaurant business can be a daunting task, especially when it comes to securing financing. Many entrepreneurs have great ideas for a new restaurant concept, but fail to bring them to life due to lack of funding. Here are some potential funding sources to consider:

  • Personal savings: If you have personal savings, it may be a good idea to use them to finance your new business.
  • Friends and family: Consider asking friends and family members for a loan or investment in your new restaurant business.
  • Bank loans: Banks are a popular source of financing for new businesses. However, you will need a good credit history and a solid business plan.
  • Private investors: Private investors can provide capital for your new business in exchange for a stake in the company.
  • Crowdfunding: Crowdfunding platforms such as Kickstarter or Indiegogo can be a great way to raise money for your new restaurant concept.

It's important to do your research and evaluate the pros and cons of each funding source before making a final decision. Here are some tips to consider when evaluating potential funding sources:

Tips & Tricks

  • Consider the interest rates and terms of each funding option before making a decision.
  • Make sure you have a solid business plan and financial projections before approaching potential investors or lenders.
  • Do not solely rely on one source of funding. It's always good to have multiple options available.



10. Monitor Financial Performance Regularly.

Once your Chinese restaurant business is up and running, it is essential to keep a close eye on its financial performance. This will allow you to make well-informed business decisions and take corrective actions to keep the business running smoothly. Here are some key steps you can take to monitor the financial performance of your Chinese restaurant.

Tips & Tricks:

  • Set financial goals: Start by setting financial milestones for your restaurant business. This will help you track your progress and take corrective actions when you are not meeting your goals.
  • Keep an eye on cash flow: Cash flow is the lifeblood of any business. Keep a close eye on the cash flow to ensure that you have enough money to pay your bills, suppliers, and employees.
  • Use financial software: Invest in a good accounting software that will help you track income, expenses, and cash flow. This will make it easier to generate financial reports and take corrective actions when needed.

Monitor your income: Keep track of the revenue generated by your restaurant business. This may include income from food and beverage sales, catering, and other revenue streams. Analyze the data to identify trends and take corrective actions when needed.

Keep track of expenses: Monitor expenses related to food and beverage, labor, rent, utilities, marketing, and other overheads. Identify areas where you can reduce costs and optimize your cash flow.

Analyze financial reports: Generate financial reports such as profit and loss statements, balance sheets, and cash flow statements. These reports will help you understand the financial health of your business and identify areas where you need to take corrective actions.

Seek professional advice: If you are not confident in your financial management skills, seek the help of a professional accountant or financial advisor. They can provide you with valuable insights and advice on how to optimize your financial performance.

In conclusion, monitoring your restaurant's financial performance regularly is crucial to ensure that your business runs smoothly and remains profitable. By setting financial goals, keeping track of cash flow, using financial software, monitoring income and expenses, analyzing financial reports, and seeking professional advice, you can take full control of your restaurant's financial performance.


In conclusion, opening a Chinese restaurant business is a challenging but exciting venture. The global demand for Chinese cuisine continues to rise, presenting a significant opportunity for entrepreneurs in the food industry. To succeed in this highly competitive market, you need to follow a clear strategy, from researching the market demand and competition to monitoring financial performance regularly. Remember, a solid business plan and financial model, a strong online presence, high-quality ingredients, and well-trained staff are essential for creating a profitable and sustainable Chinese restaurant business. By following our 10-step checklist, you can build a successful Chinese restaurant business with the potential to generate impressive profits in the long run. Good luck on your new journey towards entrepreneurship!

Excel financial model

Chinese Restaurant Financial Model
  • 5-Year Financial Projection
  • 40+ Charts & Metrics
  • DCF & Multiple Valuation
  • Free Email Support