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Starting a Restaurant – Licenses, Permits & Insurance

Do you want to know the legal requirements you need to starting a restaurant business? If YES, here is a checklist of restaurant licenses, permits & insurance.

Having provided you with a:

  1. Restaurant Industry Overview
  2. Market Research and Feasibility
  3. Restaurant Business Plan
  4. Restaurant Marketing Plan
  5. Restaurant Name ideas
  6. Cost of Starting a Restaurant
  7. Restaurant Marketing ideas

We will consider what it takes to get operating license and permit for your restaurant including insurance coverage and intellectual property protection.

Starting a Restaurant – Licenses, Permits & Insurance

  • The Best Legal Entity to Use for This Type of Business

It depends on what you want and the type of business model that you intend building; you have the options of either choosing a limited liability company which is commonly called an LLC, or a sole proprietorship. Ordinarily, sole proprietorship should have been the ideal business structure for a restaurant business especially if just starting out with a moderate capital. But people prefer limited liability Company for obvious reasons.

For example; setting up an LLC protects you from personal liability. If a customer that patronized your restaurant suffers an allergy attack from your food, his lawyers can’t go after your property or properties. It is only the money that you invested into the limited liability company that will be at risk.

It is not so for sole proprietorships and partnerships. Limited liability companies simpler and more flexible to operate and you don’t need a board of directors, shareholder meetings and other managerial formalities.

Is Professional Certification Needed to Start a Restaurant Business?

Generally, you might not have need for professional certification before you can be allowed to operate your own restaurant business in the United States of America, Canada, and Australia and even in Europe. But you would need to get clearance from local health authorities and foods and drugs agencies before you can be allowed to open and operate a restaurant.

This is so because the restaurant business is considered as a delicate business; it involves foods and drinks. You will also need a kitchen clearance certificate, food handler certificate and perhaps other relevant certification as it applies to your country or even your state.

List of Legal Documents You Need to Run a Restaurant Business

The legal requirements for restaurant business varies slightly from country to country, states to states and even from cities to cities. So, it is important to contact your local authority to know the legal requirements that you would need in order to start your own restaurant in your country.

These are some of the basic legal requirements needed before you can successfully start and run your own restaurant business;

  • Business and liability insurance
  • Food handler certificate
  • Health inspection Certificate
  • Proof of district-issued food manager identification card
  • Food purchase record storage and record keeping
  • Depot, commissary or service support facility meets vending unit operation needs
  • Copy of license for the service support facility and/or a recent inspection report
  • Tax Payer’s ID
  • Fire certificate
  • Kitchen insurance
  • Certificate of Incorporation
  • Business License
  • Business Plan
  • Non – disclosure Agreement
  • Employment Agreement (offer letters)
  • Employee’s Handbook
  • Operating Agreement for LLCs
  • Building License
  • Liquor License
  • Cabaret License
  • Music License
  • Franchise or Trademark License

The Best Insurance Needed for a Restaurant Business

When it comes to starting a restaurant business there are key insurance policies that you must have in place same applies to any other industry you intend starting a business. It is important to note that you can’t be permitted to run a restaurant business in the United States, in Canada, Australia and in Europe if you don’t have the basic insurance cover for your business; the food industry (restaurant business) is a delicate business.

These are some of the basic insurance cover that you should consider purchasing if you want to start your own restaurant business in the United States of America;

  • General insurance
  • Health insurance
  • Liability insurance
  • Kitchen Insurance
  • Workers compensation
  • Overhead expense disability insurance
  • Business owner’s policy group insurance

Intellectual Property Protection and Trademark for your Restaurant

If you are running a franchise restaurant business model, it is compulsory that you file for intellectual property protection. It will become handy and very useful as your restaurant brand begins to expand far beyond your reach. The truth is that even if you are starting your own restaurant from the scratch, you would still need to secure your brand name from an intellectual property clearinghouse.

It is a difficult to build your restaurant from the scratch, and watch the brand name slip off your hands. Even if you intend buying a restaurant franchise, you would still need to contract the trademarks and service marks from the franchising company.

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