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Editor’s Note: This is the fifth edition of a regular column on www.elrestaurante.com. Pepe Stepensky, a veteran restaurateur and a long-time member of the el Restaurante Advisory Panel, is offering his advice to any el Restaurante reader with a question. When he does not have a specific question to answer, he will write about the steps to opening and running a restaurant. Click here to email him a question.
Do not wait until the last moment to start the process of obtaining the necessary permits to open your restaurant. Once your lease is signed, start processing your permits and licenses because some can take 30 days and others up to 120 days, depending on which state you reside in.
If you are going to need to make structural modifications to open your operation, the construction permits require very specific plans. Sometimes they even request plans with elevations and signed by an architect (not by a contractor) depending on the complexity of your project.
Liquor licenses can take a long time to be approved. A very detailed investigation is conducted of every applicant in the name of the company; they take fingerprints and check everyone’s personal and business record.
There are different types of alcohol licenses. One is only to serve beer and wine, another includes liquor of all kinds. You also must decide if you want a license only to consume the product on your premises or if you want the license to include to-go liquor.
Another complication with many liquor licenses is that they require the approval of the surrounding neighbors. These types of licenses become even more delicate if there is already a saturation of liquor licenses or schools, religious institutions or sports centers close to your location, since they have the right to protest the license.
The ideal case is always to take a place that has previously had a restaurant so that most of the infrastructure is already there, which should accelerate the permitting process.
If you are lucky enough that that place has had an alcohol license before and it is still valid or has not been deregistered, contact the previous owners and see if they would be willing to transfer it to your name. It's just a signature for them but for you, it's a major time saver. If the existing license has already been deregistered, at least you know that it can be activated again and you have a high chance of getting it.
It is very important that you have a clear menu and concept that does not necessarily depend on selling or serving alcoholic beverages in case your license is late in being approved. If the success of your concept depends totally or in large percentage on selling alcohol, I suggest you do your necessary due diligence before signing the rental contract.
Here is a list of common permits and licenses that are generally required when opening a restaurant:
- Business License: This is a basic requirement for any business operation and allows you to legally operate your restaurant within a specific jurisdiction.
- Food Service License: Also known as a Food Handler's Permit, this license ensures that you and your staff have received the proper training in food safety and hygiene.
- Health Department Permit: This permit is issued by the local health department after inspecting your restaurant to ensure it is in compliance with health and safety regulations related to food preparation, storage, cleaning, and sanitation. The manager of the establishment must also take a Food Safety certification course. This certificate is a requirement of the health department, and with this certification he will be able to issue food handling certificates to new employees.
- Alcoholic Beverage License: If you plan to serve alcoholic beverages in your restaurant, you will need an alcoholic beverage license. License requirements and types vary by jurisdiction, and there may be separate licenses for beer, wine, and spirits as discussed above.
- Building and Occupancy Permit: This permit ensures that your restaurant's physical space and structure comply with local building codes and zoning regulations. It covers things like fire safety, occupancy limits, accessibility, and structural requirements.
- Signage Permit: If you plan to install exterior signs or banners for your restaurant, you may need a signage permit. Regulations regarding the size, location, and type of signage allowed vary by location.
- Music and Entertainment Licensing: If you intend to play recorded music, host live presentations or music, or provide entertainment such as karaoke or a dance floor, you may need licenses to comply with copyright laws and local entertainment regulations. The alcohol license may also restrict some of these aspects.
- Outdoor Seating Permit: If you want to be able to serve food and beverages outdoors, you may need a permit to use public spaces such as a sidewalk or patio.
- Waste Disposal Permit: This permit ensures that your restaurant properly disposes of waste, including food waste, recyclable materials, and grease from your grease trap.
- Employer Identification Number (EIN): If you plan to hire employees for your restaurant, obtaining an EIN from the Internal Revenue Service (IRS) is necessary. It is used for tax purposes and other legal obligations.
- Department of Agriculture and Weights: If you are going to sell food by the pound, your scales must be checked and authorized with a permit and stamp from the Department of Agriculture and Weights. Not all scales are accepted. Make sure before you buy them.
Although this all sounds very complicated, do not be discouraged. Getting these permits ensures that everything is safe and helps you avoid unexpected visits from the government. Surprises in this industry can be very expensive and erode your chances for the success. Don’t skip steps or try to go the easy route!
So: Do your research, ask questions, and find a mentor if this is your first restaurant experience.
Remember that there are many important elements besides having a good menu and there are people like me who were lucky enough to be guided by others who had already walked the path. Today we have the responsibility of giving that knowledge to others.
Keep in touch!
Remember, Pepe wants questions! Fire away: Click here to email him a question.
Pepe Stepensky has 35 years of experience as a restaurant owner. He also is a published author and a three-time Emmy winner as a documentary producer and director. He and his wife Deborah own five fast casual restaurants in San Diego, CA. Click here to email him a question.