How much will it cost to open a restaurant in Saudi Arabia?

How much will it cost to open a restaurant in Saudi Arabia?

2019-01-16


Eating Out Trend

Saudis have proven their willingness to spend so much on eating out of the home. It became a trend and is growing rapidly. Some of the reasons behind this trend could be the lack of entertainment attractions so, eating-out it is considered as a place for gathering and having fun. This trend presents an opportunity for people who want to open a restaurant.

 

Be prepared

However, before you open a restaurant you have to keep an eye of the changes and challenges around you such as changes in supply prices and managing employees. Moreover, Saudis are proven to be the largest well-traveled population in GCC, so they are familiar with trends all around the world. As a result, their expectations are higher. One mistake could cost you so much because they will leave you and find a better one.

 

How to Calculate The Cost of Opening a New Restaurant?

Now you know that it is a big opportunity to open a restaurant in Saudi Arabia (KSA), but do you have the budget to start a restaurant? The cost of opening a restaurant varies due to different priorities for each individual. As a result, It is impossible to tell the exact number of how much money you will spend to open a new one.

 

Factors to Consider

You have to consider many factors that influence the cost of opening a restaurant such as a restaurant area, location and the software you will use. Today, we will give you a table with a range of the main costs to consider before opening a restaurant, you can check it and decide how much you would spend based on your priorities.

The information provided is presented by Faris Alturki (@farooi), a Saudi entrepreneur who owns a famous restaurant called “Fatoor Faris”. To view Faris’s video click here.

 

 

Min (SAR)

Max (SAR)

Notes

Restaurant feasibility Study

15 K

120 K

Feasibility study includes market statistics, evaluation of potential locations, reviewing the competition, studying the industry, breaking down the cost structure and evaluation management capabilities.  

Restaurant Rent

500/ m^2

3000/ m^2

It depends on your restaurant area, city, location, and street.

Restaurant Branding

10 K

70 K

It includes the brand name, logo and brand identity. Branding is important because it creates an image of your restaurant and allows your customers to know what to expect from your restaurant.

Restaurant Design

20 K

150 K

You have to consider your needs to design your restaurant properly. Plan for waiting area, outdoor design, restrooms, dining room and most importantly, the kitchen.

Construction

2 K

10 K

It includes Electricity extensions, lighting, AC.

Restaurant Kitchen

150 K

1.2 M

You must make sure the equipment you buy for your kitchen is capable to handle the production of your dishes.

Restaurant Labor

4K/ Employee

6K/ Employee

You have to check regular updates in levies businesses pay on foreign workers, minimum wages and related costs.

Restaurant Operations Manual

20 K

60 K

It is a document that explains all the operations procedures such as marketing, how create each dish, hygiene protocols recipes...etc.

Accounting Software

HR Software

IT

Monthly Subscription

 

Includes fingerprint system, monitoring systems, wireless, emails, integrating the branches..etc.

Marketing

0 K

100 K

It is important to spend enough on marketing to show off your hard work to your potential customers.

Government Fees

Issuance of Commercial Register 300/year

Chamber of Commerce Licence 600/year

Ministry of Municipal and Rural Affairs Licence 3000/year

Check regular updates on fees.

Energy

Water

Electricity

Phone/Internet

 

 

 

 

It depends on the size of your restaurant and the energy you consume.

 

To download the excel sheet with costs click here.

 

Faris also mentioned that for each restaurant, there should be a lawyer responsible for auditing contracts and an engineering consultant to manage your project and avoid any misunderstanding with construction engineers.

In conclusion, opening a restaurant in Saudi Arabia (KSA) is a huge opportunity, but you have to study the idea well before getting started. Moreover, you have to estimate how much you would spend before you start.

 

 

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