How to Start a Pop-Up Restaurant

Pop-up restaurants have popped up big time, often used by new chefs to generate interest and build their brand. The trend has taken hold in cities like New York City and San Francisco, where younger eaters line up for these temporary establishments. 

But a pop-up restaurant doesn’t have to be just a brand builder – you could actually start a business using the pop-up concept. If you’re an aspiring chef, it’s a great way to get into the $200 billion restaurant industry for less money than a brick-and-mortar establishment.

But before you hit the kitchen, you’ll need some business savvy. Luckily, this step-by-step guide has all the business insights you need to start popping up a profit. 

Step 1: Decide if the Business Is Right for You

Pros and cons

Pop-Up Industry Trends

Industry size and growth

While there are no industry statistics for pop-up restaurants, they fall under the single location full-service restaurant category.

• Industry size and past growth – The U.S. single location full-service restaurant industry is worth $209 billion in 2023 after expanding .4% annually the last five years.((https://www.ibisworld.com/united-states/market-research-reports/single-location-full-service-restaurants-industry/))
• Growth forecast – The U.S. single location full-service restaurant industry is projected to expand 1.1% in 2023.
• Number of businesses – In 2023, 177,308 single location full-service restaurants are operating in the U.S. 
• Number of people employed – In 2023, the U.S. single location full-service restaurant industry employs 3,566,586 people. 

Trends and challenges

Trends

• Pop-up restaurants are marketing themselves as dining experiences, rather than marketing the food itself.
• Many pop-up restaurants partner with existing establishments to use their kitchen and dining spaces. These partners are often diners that only serve breakfast and lunch, so the space is available for evening dinners. Other options include coffee shops or supper clubs. 

Challenges

• It can be difficult to hire staff for a pop-up restaurant since work hours will be sporadic.
• Rising food prices may make it more difficult to achieve profit margin goals. 

Consumer spending

• Average consumer spend – The average person in the U.S. spends $2,375 per year dining out.((https://www.fool.com/the-ascent/personal-finance/articles/americans-spend-an-average-of-2375-per-year-on-dining-and-takeout-6-tips-to-spend-less/))
• Potential customer base –  23.9% of US adults dine out at least once per week.((https://www.statista.com/statistics/1085326/dining-out-habits-in-the-us/))

Demand hotspots

• Most popular states – The most popular states for chefs are Nevada, Texas, and New Jersey.((https://www.zippia.com/chef-jobs/best-states/))
• Least popular states – The least popular states for chefs are South Dakota, Iowa, and Michigan.

What kind of people work in pop-up restaurants?

• Gender – 25% of chefs are female, while 75% are male.((https://www.zippia.com/chef-jobs/demographics/))
• Average level of education – The average chef has an associate’s degree.
• Average age –The average chef in the US is 42 years old.

How much does it cost to start a pop-up restaurant business?

You’ve got two options when starting a pop-up restaurant. You can partner with existing restaurants to use their space when they’re closed, which means you won’t have to invest in equipment. In that case, startup costs will be about $7,500, most of which is for an initial operating budget to pay for the space and to pay your staff.

The other option is to purchase portable kitchen equipment and put your pop-up restaurant in any space that meets health and safety standards. This might cost $30,000.

You’ll need a handful of items to successfully launch your pop-up restaurant business if you opt to buy kitchen equipment, including: 

• Grill
• Deep fryer
• Portable stove top
• Pans, etc.
• Cooler
• Cutting tables
• Truck to transport equipment

Start-up Costs	Ballpark Range	Average
Setting up a business name and corporation	$100 - $500	$300
Business licenses and permits	$1,000 - $3,000	$2,000
Insurance	$100-$500	$300
Initial Marketing Budget	$200 - $500	$350
Initial Operating Budget	$5,000 - $10,000	$7,500
Ingredients for first pop up	$1,000 - $2,000	$1,500
Portable kitchen equipment	$0 - $10,000	$5,000
Truck to transport equipment - down payment	$0 - $5,000	$2,500
Total	$7,400 - $31,500	$19,450

How much can you earn from a pop-up restaurant business?

Most pop-up restaurants offer a limited, prix fixe menu and charge a flat fee. If you’re serving higher end food, you could probably charge about $100 per person. Your profit margin after food, the space, and staff costs, should be about 30%.

In your first year or two, you might open your pop-up restaurant 15 times per year and serve 100 people each time, bringing in $150,000 in revenue. This would mean $45,000 in profit, assuming that 30% margin. 

As you gain traction, you might open your pop-up once per week. With annual revenue of $520,000, you’d make a tidy profit of $156,000.

What barriers to entry are there?

There are a few barriers to entry for a pop-up restaurant. Your biggest challenges will be:

• Funding the startup costs, particularly if you purchase equipment
• Finding staff 

Step 2: Hone Your Idea

Now that you know what’s involved in starting a pop-up restaurant, it’s a good idea to hone your concept in preparation to enter a competitive market. 

Market research could give you the upper hand even if you’ve got the perfect product. Conducting robust market research is crucial, as it will help you better understand your customers, your competitors, and the broader business landscape.

Analyze your competitors 

Research pop-up restaurants in your area to examine their menus, price points, and customer reviews.

• Make a list of pop-up restaurants that offer similar products. 
• Review your competitors’ menus – their features, pricing, and quality – and marketing strategies
• Check out their online reviews and ratings on Google, Yelp, and Facebook to get an idea of what their customers like and dislike.
• Identify your competitors’ strengths and weaknesses. 

This should identify areas where you can strengthen your business and gain a competitive edge to make better business decisions.

Why? Identify an opportunity

You’re looking for a market gap to fill. For instance, maybe the local market is missing a French fine dining pop-up, or a steakhouse pop-up.

This could jumpstart your word-of-mouth marketing and attract clients right away. 

What? Determine your products or services

Your main product is your food. You could also serve alcohol, but you’d probably need a temporary liquor license. As mentioned, it’s most common to offer a prix fixe menu, so you’ll have to select what dishes to offer. 

How much should you charge at your pop-up restaurant?

Since people are paying for a prix fixe menu and the culinary experience, if you’re offering fine dining you should be able to charge $100 to $150 per person. After your costs of the space, food, and staffing, you should aim for a profit margin of about 30%.

Once you know your costs, use this Step By Step profit margin calculator to determine your mark-up and final price points. Remember, the prices you use at launch should be subject to change if warranted by the market.

Who? Identify your target market

Your target market will depend on the location where you’re popping up. If you’re in a more affluent area, you’ll likely find your target customers on Instagram or Facebook. If you’re aiming for a younger, trendy area, you’ll want to add TikTok to the mix.

Social media is going to be the main way that you’ll notify people of your pop-up, so be prepared to aggressively promote your restaurant each time you open. 

Where? Choose your pop-up restaurant location

When choosing a commercial space, you may want to follow these suggestions:

• Target Audience: Choose a location frequented by your intended customers like young professionals, families, or tourists.
• Foot Traffic: Select areas with high foot traffic, such as near shopping centers or tourist spots, and avoid isolated locations.
• Competition Analysis: Look for areas with few competitors and where complementary businesses exist.
• Accessibility: Ensure easy access via public transport or ample parking, and consider disability access.
• Budget: Keep in mind rental costs and consider more affordable areas or shared spaces to minimize expenses.
• Regulations and Permits: Comply with local zoning, health regulations, and acquire necessary permits.
• Infrastructure Needs: Check for essential utilities and necessary kitchen space or equipment.
• Visibility and Branding: Choose a visible location that supports your branding and allows for effective signage.

You can find commercial space to rent in your area on sites such as Craigslist, Crexi, and Instant Offices.

Step 3: Brainstorm a Pop-Up Restaurant Name

Your business name is your business identity, so choose one that encapsulates your objectives, services, and mission in just a few words. You probably want a name that’s short and easy to remember, since much of your business, and your initial business in particular, will come from word-of-mouth referrals.

Here are some ideas for brainstorming your business name:

• Short, unique, and catchy names tend to stand out
• Names that are easy to say and spell tend to do better 
• Name should be relevant to your product or service offerings
• Ask around — family, friends, colleagues, social media — for suggestions
• Including keywords, such as “pop-up restaurant” or “pop-up fine dining”, boosts SEO
• Name should allow for expansion, for ex: “Culinary Fusion Pop-Up” over “Seafood Delights Pop-Up”
• Avoid location-based names that might hinder future expansion
• Use online tools like the Step by Step Business Name Generator. Just type in a few keywords and hit “generate” and you’ll have dozens of suggestions at your fingertips.

Once you’ve got a list of potential names, visit the website of the US Patent and Trademark Office to make sure they are available for registration and check the availability of related domain names using our Domain Name Search tool. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these. 

Finally, make your choice among the names that pass this screening and go ahead and reserve your business name with your state, start the trademark registration process, and complete your domain registration and social media account creation. 

Your business name is one of the key differentiators that sets your business apart. Once you pick a name, reserve it and start with the branding, it’s hard to switch to a new name. So be sure to carefully consider your choice before moving forward. 

Step 4: Create a Pop-Up Restaurant Business Plan

Every business needs a plan. This will function as a guidebook to take your startup through the launch process and maintain focus on your key goals. A business plan also enables potential partners and investors to better understand your company and its vision:

• Executive Summary: Summarize your pop-up restaurant business plan, highlighting your concept and goals.
• Business Overview: Explain your pop-up restaurant concept, its location, and the type of cuisine or experience you’ll offer.
• Product and Services: Detail the menu items and dining experience you’ll provide, including any unique features or offerings.
• Market Analysis: Analyze the local restaurant market, identifying customer preferences and trends to support your concept.
• Competitive Analysis: Identify existing restaurants in your area, highlighting their strengths and weaknesses and explaining how your pop-up will stand out.
• Sales and Marketing: Outline your strategies for attracting customers, including social media, partnerships, and event promotion.
• Management Team: Introduce key team members involved in your pop-up restaurant, emphasizing their culinary expertise and experience.
• Operations Plan: Describe the logistics of running your pop-up, including sourcing ingredients, setting up at events or locations, and managing staff.
• Financial Plan: Present financial projections, including startup costs, revenue forecasts, and profit margins for your pop-up restaurant.
• Appendix: Include additional materials, such as sample menus, event schedules, or testimonials from satisfied customers, to support your pop-up restaurant business plan.

If you’ve never created a business plan, it can be an intimidating task. You might consider hiring a business plan specialist to create a top-notch business plan for you.

Step 5: Register Your Business

Plus, registration is exciting because it makes the entire process official. Once it’s complete, you’ll have your own business! 

Choose where to register your company

Your business location is important because it can affect taxes, legal requirements, and revenue. Most people will register their business in the state where they live, but if you are planning to expand, you might consider looking elsewhere, as some states could offer real advantages when it comes to pop-up restaurants. 

If you’re willing to move, you could really maximize your business! Keep in mind, it’s relatively easy to transfer your business to another state. 

Choose your business structure

Business entities come in several varieties, each with its pros and cons. The legal structure you choose for your pop-up restaurant will shape your taxes, personal liability, and business registration requirements, so choose wisely. 

Here are the main options:

• Sole Proprietorship – The most common structure for small businesses makes no legal distinction between company and owner. All income goes to the owner, who’s also liable for any debts, losses, or liabilities incurred by the business. The owner pays taxes on business income on his or her personal tax return.
• General Partnership – Similar to a sole proprietorship, but for two or more people. Again, owners keep the profits and are liable for losses. The partners pay taxes on their share of business income on their personal tax returns.
• Limited Liability Company (LLC) – Combines the characteristics of corporations with those of sole proprietorships or partnerships. Again, the owners are not personally liable for debts.  Here’s how to form an LLC.
• C Corp – Under this structure, the business is a distinct legal entity and the owner or owners are not personally liable for its debts. Owners take profits through shareholder dividends, rather than directly. The corporation pays taxes, and owners pay taxes on their dividends, which is sometimes referred to as double taxation. Read how to start a corporation here.
• S Corp – An S-Corporation refers to the tax classification of the business but is not a business entity. An S-Corp can be either a corporation or an LLC, which just need to elect to be an S-Corp for tax status. In an S-Corp, income is passed through directly to shareholders, who pay taxes on their share of business income on their personal tax returns.

We recommend that new business owners choose LLC as it offers liability protection and pass-through taxation while being simpler to form than a corporation. You can form an LLC in as little as five minutes using an online LLC formation service. They will check that your business name is available before filing, submit your articles of organization, and answer any questions you might have. 

Step 6: Register for Taxes

The final step before you’re able to pay taxes is getting an Employer Identification Number, or EIN. You can file for your EIN online or by mail or fax: visit the IRS website to learn more. Keep in mind, if you’ve chosen to be a sole proprietorship you can simply use your social security number as your EIN. 

Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business will operate in a calendar year (January–December) or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.

It is important to consult an accountant or other professional to help you with your taxes to ensure you are completing them correctly.

Step 7: Fund your Business

Securing financing is your next step and there are plenty of ways to raise capital:

• Bank loans: This is the most common method but getting approved requires a rock-solid business plan and strong credit history.
• SBA-guaranteed loans: The Small Business Administration can act as guarantor, helping gain that elusive bank approval via an SBA-guaranteed loan.
• Government grants: A handful of financial assistance programs help fund entrepreneurs. Visit Grants.gov to learn which might work for you.
• Friends and Family: Reach out to friends and family to provide a business loan or investment in your concept. It’s a good idea to have legal advice when doing so because SEC regulations apply.
• Crowdfunding: Websites like Kickstarter and Indiegogo offer an increasingly popular low-risk option, in which donors fund your vision. Entrepreneurial crowdfunding sites like Fundable and WeFunder enable multiple investors to fund your business.
• Personal: Self-fund your business via your savings or the sale of property or other assets.

Bank and SBA loans are probably the best option, other than friends and family, for funding a pop-up restaurant business. You might also try crowdfunding if you have an innovative concept and menu. 

Step 8: Apply for Pop-up Restaurant Business Licenses and Permits

Starting a pop-up restaurant business requires obtaining a number of licenses and permits from local, state, and federal governments.

Federal regulations, licenses, and permits associated with starting your business include doing business as (DBA), health licenses and permits from the Occupational Safety and Health Administration (OSHA), trademarks, copyrights, patents, and other intellectual properties, as well as industry-specific licenses and permits. 

Food service and health permit requirements will vary depending on where you open your restaurant, so check with your state and locality. You also will likely need liquor licenses if you serve alcohol. 

You may also need state-level and local county or city-based licenses and permits. The license requirements and how to obtain them vary, so check the websites of your state, city, and county governments or contact the appropriate person to learn more. 

You could also check this SBA guide for your state’s requirements, but we recommend using MyCorporation’s Business License Compliance Package. They will research the exact forms you need for your business and state and provide them to ensure you’re fully compliant.

If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes.

Step 9: Open a Business Bank Account

Before you start making money, you’ll need a place to keep it, and that requires opening a bank account.

Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income, so it’s worth doing even if you’re running your pop-up restaurant business as a sole proprietorship. Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer accounts tailored for businesses — just inquire at your preferred bank to learn about their rates and features.

Banks vary in terms of offerings, so it’s a good idea to examine your options and select the best plan for you. Once you choose your bank, bring in your EIN (or Social Security Number if you decide on a sole proprietorship), articles of incorporation, and other legal documents and open your new account. 

Step 10: Get Business Insurance

Business insurance is an area that often gets overlooked, yet it can be vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your business.

Here are some types of insurance to consider:

• General liability: The most comprehensive type of insurance, acting as a catch-all for many business elements that require coverage. If you get just one kind of insurance, this is it. It even protects against bodily injury and property damage.
• Business Property: Provides coverage for your equipment and supplies.
• Equipment Breakdown Insurance: Covers the cost of replacing or repairing equipment that has broken due to mechanical issues.
• Worker’s compensation: Provides compensation to employees injured on the job.
• Property: Covers your physical space, whether it is a cart, storefront, or office.
• Commercial auto: Protection for your company-owned vehicle.
• Professional liability: Protects against claims from a client who says they suffered a loss due to an error or omission in your work.
• Business owner’s policy (BOP): This is an insurance plan that acts as an all-in-one insurance policy, a combination of the above insurance types.

Step 11: Prepare to Launch

As opening day nears, prepare for launch by reviewing and improving some key elements of your business. 

Essential software and tools

Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, many websites and digital tools are available to help simplify many business tasks.  

You may want to use industry-specific software, such as Restaurant 365 or RSVP, to manage your bookings, food inventory, recipe costing, and reporting. 

Accounting

• Popular web-based accounting programs for smaller businesses include Quickbooks, Freshbooks, and Xero. 
• If you’re unfamiliar with basic accounting, you may want to hire a professional, especially as you begin. The consequences for filing incorrect tax documents can be harsh, so accuracy is crucial.

Create a website

Website development is crucial because your site is your online presence and needs to convince prospective clients of your expertise and professionalism. You can create your own website using services like WordPress, Wix, or Squarespace. This route is very affordable, but figuring out how to build a website can be time-consuming. If you lack tech-savvy, you can hire a web designer or developer to create a custom website for your business.

Your customers are unlikely to find your website, however, unless you follow Search Engine Optimization (SEO) practices. SEO will help your website appear closer to the top in relevant search results, a crucial element for increasing sales. 

Make sure that you optimize calls to action on your website. Experiment with text, color, size, and position of calls to action such as “Book Table Now”.  This can sharply increase purchases. 

Marketing

Here are some powerful marketing strategies for your future business:

1. Social Media Teasers: Leverage the power of social media platforms to create anticipation by posting tantalizing sneak peeks of your menu, behind-the-scenes preparations, and countdowns to your pop-up event.
2. Collaborate with Influencers: Partner with local influencers or food bloggers who align with your brand to create a buzz. Their reviews and endorsements can significantly impact potential customers’ perceptions.
3. Limited-Time Offers: Create a sense of urgency by promoting exclusive, time-sensitive offers or discounts for the first customers, encouraging them to try your pop-up on opening day.
4. Engaging Email Campaigns: Build an email list through promotions or contests and keep your audience engaged with regular updates, special offers, and exclusive content leading up to the pop-up event.
5. Themed Events and Promotions: Add excitement by incorporating themes into your pop-up events, such as seasonal menus, holiday specials, or unique dining experiences, to attract a diverse audience.
6. Flash Sales and Pre-Orders: Implement flash sales or pre-order options for your menu items, allowing customers to secure their spot and generating revenue before the pop-up event even begins.
7. Local Partnerships: Collaborate with local businesses, such as nearby shops or breweries, to cross-promote each other and tap into each other’s customer base.
8. Loyalty Programs: Create a loyalty program offering incentives for repeat customers, encouraging them to return for subsequent pop-up events and helping to build a loyal customer base.
9. Interactive Marketing: Engage potential customers with interactive marketing, such as live cooking demonstrations, tastings, or contests, both online and at the physical location, to create a memorable experience.

Focus on USPs

Unique selling propositions, or USPs, are the characteristics of a product or service that sets it apart from the competition. Customers today are inundated with buying options, so you’ll have a real advantage if they are able to quickly grasp how your pop-up restaurant meets their needs or wishes. It’s wise to do all you can to ensure your USPs stand out on your website and in your marketing and promotional materials, stimulating buyer desire. 

Global pizza chain Domino’s is renowned for its USP: “Hot pizza in 30 minutes or less, guaranteed.” Signature USPs for your pop-up restaurant business could be:

• The hottest restaurant in town! 
• The finest culinary experience of your life.
• French cuisine you’ll never forget.

Networking

You may not like to network or use personal connections for business gain. But your personal and professional networks likely offer considerable untapped business potential. Maybe that Facebook friend you met in college is now running a pop-up restaurant business, or a LinkedIn contact of yours is connected to dozens of potential clients. Maybe your cousin or neighbor has been working in pop-up restaurants for years and can offer invaluable insight and industry connections. 

The possibilities are endless, so it’s a good idea to review your personal and professional networks and reach out to those with possible links to or interest in pop-up restaurants. You’ll probably generate new customers or find companies with which you could establish a partnership. 

Step 12: Build Your Team

If you’re starting out small from a home office, you may not need any employees. But as your business grows, you will likely need workers to fill various roles. Potential positions for a pop-up restaurant business include:

• Servers – serve meals
• Bartenders – make and serve drinks
• Waitstaff – take orders, customer service
• Sous Chefs – assist with food preparation

At some point, you may need to hire all of these positions or simply a few, depending on the size and needs of your business. You might also hire multiple workers for a single role or a single worker for multiple roles, again depending on need. 

Free-of-charge methods to recruit employees include posting ads on popular platforms such as LinkedIn, Facebook, or Jobs.com. You might also consider a premium recruitment option, such as advertising on Indeed, Glassdoor, or ZipRecruiter. Further, if you have the resources, you could consider hiring a recruitment agency to help you find talent. 

Step 13: Run a Pop-up Restaurant – Start Making Money!

Pop-up restaurants are all the rage, offering unique culinary experiences to the hip and trendy. It’s a great way for an aspiring chef to get into the food game, build a name and save up to open brick-and-mortar restaurant. 

Now that you’ve got some business knowledge under your belt, it’s time to pull out your culinary drawing board and become a successful pop-up restauranteur!