Construction and Equipment For your Smoothie Shop
APPROVAL OF PLANS
Now that your floor plans are complete, it’s time to begin the actual construction of your restaurant. Take your full set of plans to those city departments that must approve them. It is important to develop a good working relationship with each city department and be sure that you obtain the necessary approvals before starting any work. In dealing with each department, you should be knowledgeable of your plans and city requirements. Be receptive to any comments or recommendations they may make. If you hire a general contractor to build your restaurant, he will probably take care of obtaining permits.
Typically, permits and approvals are obtained in the following order:
1. Zoning Department
You will probably need a plot plan showing the location of your restaurant. You can usually obtain this from the landlord, or it might be included as an exhibit in your lease.
2. Health Department
They will be concerned with floor and wall coverings, equipment, plumbing, and bathroom facilities.
3. Fire Marshall (if required)
Fire Department approval may be needed. Information on fire ratings of decor items can be obtained from your Coordinator or Construction Assistant.
4. Building Permit
After all requirements are met, the building department will issue permits. Plumbing and electrical contractors will probably be required to obtain their own permits.
BUILDING YOUR RESTAURANT
Hiring a General Contractor
A general contractor will handle all aspects of obtaining permits and the building of your restaurant for an agreed upon price. A general contractor may be beneficial in the following instances:
• A general contractor can frequently obtain permits more easily where local building departments are very strict, since he is familiar with the requirements.
• If you do not have the working knowledge of construction needed to coordinate the building of your restaurant.
• If you are not able to spend the time necessary to obtain permits, hire sub-contractors, and coordinate construction.
Acting as a general contractor and hiring sub-contractors
By acting as your own general contractor, you may be able to save a considerable amount of money, as compared to a general contractor’s bid. If you choose to do this, however, you must be completely familiar with the building requirements and codes in your area. The money you save by doing the job yourself could be lost if you find, after your restaurant is completely built, that something was done incorrectly or out of code. To act as your own general contractor, you will need to:
• Have a working knowledge of how to coordinate the construction of your restaurant. You must be able to obtain permits, hire sub-contractors, and oversee all building aspects.
• Know construction costs. In order to hire sub-contractors, you will need to know what a job should cost. By obtaining several bids you should be able to get a fair cost comparison.
• Be able to spend the time. Coordinating the construction of your restaurant will require spending a great deal of time making phone calls, visiting the various city building departments, and being on-site to supervise construction.
Doing the Work Yourself
The more work you are able to do yourself, the less money you will spend on contractors. Keep in mind that the completed restaurant must be of professional quality to ensure the best appearance and maximum durability. Again, restrictions of time and personal capability will determine how much work you will be able to do yourself. A typical person with average to above average construction skills and enough time to handle the job may do the following:
• Hire sub-contractors for the plumbing, electrical, HVAC (heat, ventilation, and air conditioning), installation of quarry tile floor, and installation of counter tops and cabinets. Sub-contractors should also obtain the required permits.
• Do the basic construction.
• Obtain permit for carpentry.
• Build interior partitions and do the finish-work in the restaurant, (walls, counters, cabinets, etc.)
After floor plans are complete and you have decided how you are going to go about building your restaurant, you should hire your contractors. You can find potential contractors in the following ways:
1. Yellow Pages or Local Trade Association
Many reputable building firms advertise in the Yellow Pages of your local phone book. Many areas also have trade associations that can refer you to competent contractors.
Once you have developed a list of potential contractors, you should:
a. Give each a set of plans and meet them at the restaurant for a site evaluation and answer any questions they might have.
b. Establish the criteria you will need for the submission of their bids, and set a deadline for submission of proposals. Bids should be definitive to avoid any costly extras or delays. Proposals should always be in writing.
c. Establish commencement and completion dates. Contractors should be made aware of the importance of getting the restaurant open quickly and should be able to start work right away.
Obtain at least three bids for each job to be contracted out. References should also be obtained with each proposal. You may want to check with the local Better Business Bureau before awarding a contract. The successful bidder should provide you with:
1. A signed contract: The contract should specifically state the scope of work to be done, commencement and completion dates, and the terms for the payment.
• Avoid excessive up-front payments. No monies should be paid before work starts. Don’t let payments exceed the amount of work completed.
• The contract should state that the contractor is responsible for building the restaurant according to Company specifications, standards, and plans.
• Hold back 10% for 30-60 days after the restaurant is completed. This will ensure that minor details are not neglected.
• You may want to include a clause to provide a penalty for not meeting specified deadlines.
2. Certificate of Insurance: The contractor should be responsible for providing the proper contractor’s liability and workers’ compensation for his crew.
3. Get lien releases from your general and sub-contractors upon payment.
You will be setting up a commercial account for your utilities, and you must make security deposits before service will be issued in your name. These deposits will range from fairly nominal fees for the water company to substantial amounts for electricity. These deposits will vary depending upon location. Be prepared to make deposits totaling approximately $1,000 to $1,500. Some utilities, upon customer request, will review or re-evaluate the account after two or three months of billing. If payments have been current and if there is no further need for the security, the utility should refund the deposit with interest.
The first step in setting up service is to call the customer service representative. They will advise you as to how the contract is set up. Have all the information regarding the specific restaurant address, meter numbers, and access information. If you are in a mall, there may be posted regulations or restrictions on the times at which hook-ups can be made. Your electrical service will be necessary during construction and you will want to be sure all service is established when you get occupancy.
Though policies vary from area to area, the following are the most common:
1. Most companies will set up and contract with you as an individual user. In some cases there may be a group pick-up for more than one restaurant at your location, which would have to be worked out with your landlord or mall association.
2. Gas: This deposit will be based on an average usage for three months. If it is an existing restaurant, they will use previous records. If it is a new restaurant, it would probably be estimated at approximately $300.
3. Electric: This deposit will be based on two months estimated billing. Where there is a record of previous billing, the charge will be determined on that billing. In the case of new service, it will be based on the equipment needs and total wattage you require. Since electricity may average $100 a week, the required deposit may be $800 to $1,000.
4. Telephone: This deposit will be established on an estimated two months billing and on the service and equipment you request.
5. Oil: No deposit is required to set up oil delivery. You will have to establish credit and decide whether you want to pay on a budget system. As in residential accounts, your sales associate will estimate your needs and average your payments over the course of a year so that you may avoid high bills during the winter months.
6. Insurance: See Chapter 3 – “Accounting & Insurance” for insurance requirements.
7. Garbage Removal: Contract for this service early so it will be available during the construction period
OVERSEE CONSTRUCTION DAILY
While your restaurant is under construction, visit the site on a regular basis. This will ensure that your restaurant will be built properly and in a timely manner. Keep in touch with contractors to avoid problems and to expedite progress. It is best to contact most contractors early in the morning or late at night at home. Your continued presence and interest will ensure that you get what you pay for.
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