Opening a new restaurant requires an exceptional number of licenses and permits. You need to acquire these one by one if you’re going to be able to open your doors on time. Some licenses and permits for restaurants can take months to acquire, due to waiting lists and lengthy processing times. Start this process as early as possible to avoid complications.
Steps to Learning About How to Get Restaurant Licenses and Permits
- Business License
- Liquor License
- Food Service License
- Employer Identification Number (EIN)
- Food Handler’s Permit
- Sign Permit
- Paperwork is Part of the Process
A business license will need to be renewed every year. But before you acquire a business license, you’ll have to determine the structure of your business. A restaurant could be structured as a partnership, an LLC, or a corporation, depending on who is involved in the business, and which assets you want to protect.
To register your business, you will also need to ensure that your business has a unique name. You can search your company’s local business database to make sure.
An attorney will be able to help you structure your business properly and fill out any relevant business licensing forms. Once you’ve licensed your business with the state, you can proceed to get the other permits and licenses you need.
If your restaurant is going to serve liquor, you need a liquor license. Every city has different requirements for a liquor license. Some cities require that you notify all nearby businesses. Other cities have a specific number of liquor licenses allotted.
Some common requirements for a liquor license include:
- Serving food on premises.
- Having a “21 and over” area.
- Training staff appropriately.
After acquiring a liquor license, you need to maintain your liquor compliance. If you’re caught selling to people under 21, or you are caught selling out of hours, you can get your license taken away. If your license is taken away, it can take days or weeks to reestablish.
Liquor licenses may cost quite a bit depending on your location. However, liquor is a very large portion of sales for many restaurants. For some restaurants, it’s impossible to make a profit without it.
Food service licenses are acquired from your local health department. Your health department will inspect your property to make sure that it meets regulatory standards, in addition to looking through your business processes. There may be scheduled and random health department inspections to maintain your food service license.
You can fill out the initial application for a food service license with the health department, either in paper or online. From there, they will schedule a time and date for an initial inspection. If your current operations does not meet requirements, the inspector will often tell you what you need to fix, and you will be given time to fix it.
Without a food service license, you cannot commercially prepare and sell food. It’s vital that you not only obtain but also maintain your food service license, by keeping a clean property, and keeping food properly stored and prepared.
To hire employees, get bank loans, and open business bank accounts, your restaurant will need an Employer Identification Number. An Employer Identification Number is a federal ID number that is used to identify your business, like a social security number. It’s used by financial institutions for the purposes of lending and credit scoring, and it’s used by the federal government to track payroll payments and hiring. Without an employer identification number, you won’t be able to hire employees, pay payroll taxes, or get a restaurant line of credit. An EIN is fast to get: you can get one online in an hour.
Every individual in your business who is handling food will need a food handler’s permit, which is generally paid for by the business. A food handler’s permit can cost anywhere from under a hundred dollars to a few hundred dollars, depending on location. To get a food handler’s permit, an individual needs to take a brief course on food safety. This ensures that everyone who works for you understands the basics.
Food handler’s permits usually need to be renewed every few years. Maintaining your employees’ food handler’s permits is an important part of managing your business.
Your restaurant is likely to need a permit for its signage, in additional to everything else. In general, many of the construction that you do for your restaurant may require a permit. If you aren’t doing any type of build out, you may still need a sign permit. This can be acquired from your city’s local permitting office. You will likely need to have detailed plans for the permit.
These permits and licenses aren’t all the documents you will need to file as you open a restaurant. You will also need business plans, financial statements, and more. Opening a restaurant is going to require that you fill out quite a lot of paperwork. Keep everything organized to avoid any issues later on, and you’ll be well on your way to a successful restaurant.
This has been a broad overview of licenses and permits for restaurants, but they do vary based on state. You should contact your state licensing boards to learn more.
Not only do you need to apply for these licenses and permits initially, but you will also need to reapply for them on an annual basis or every few years. It’s a good idea to maintain a schedule of your licensing and permits, to make sure that nothing ever lapses. When you first open your business, you will first need to get a business license, employer identification number, and food license. These three are critical to opening your business.