Restaurant setup costs: Some key things to be aware of when starting out

The cost of opening a restaurant in the UK depends on the size, location, and type of establishment, and totals vary so widely by site that no single headline figure is a reliable guide. This article breaks the costs down line by line instead, with a published estimate and a named source next to each figure, plus the main funding and banking points to plan for. It is written for first-time owners getting ready to open a restaurant, pub, or bar in the next year.

Costs vary by business, so treat the figures here as indicative rather than a complete list. You should always consult a professional adviser for advice tailored to your business's specific needs and circumstances.

Key takeaways

• Costs vary widely by site and route, so this article works line by line: each cost area below carries a published estimate with its source next to the figure.
• Premises and kitchen fit-out are usually the two biggest costs.
• Consider splitting your budget into one-off setup costs and ongoing monthly costs. Many new owners run short of cash by forgetting the monthly side.
• It may be helpful to set aside some working capital reserve to cover the first three to six months of trading before sales settle.
• A separate business bank account from day one makes the budget easier to track. Some accounts, such as the Zempler Bank business current account, let you apply online in minutes and pay in cash at Post Office branches.

How much does it cost to open a restaurant in the UK?

There is no single price tag, and published totals differ so much by source and by route that a headline figure can mislead more than it helps. Instead, this article prices each cost area individually, with its source alongside, in the breakdown below. Treat the published figures as a starting point and build your own budget from real quotes for your specific site.

Three things move the total more than anything else:

• Location. City centre and London rents are far higher than a high street in a smaller town.
• Size and covers. Covers means the number of diners you can seat. More covers mean more space, more equipment, and more staff.
• Site condition. Taking over a former restaurant costs less than fitting out an empty shell from scratch.

Restaurant startup costs breakdown

Most restaurant budgets fall into seven areas. Work through each one and add your own numbers. Each published figure below carries its source, and the summary table at the end of this section pulls them together.

Premises: deposit, rent, and business rates

Premises is usually one of the two biggest costs, alongside the kitchen fit-out. You normally pay a rent deposit upfront, which is commonly three to six months of rent. You also pay the first period of rent and any legal fees on the lease. Typical monthly rent is £2,000 to £5,000, and £12,000 or more in London.

You may also pay business rates. This is a tax on most business premises, based on the rateable value of the property, which is the rent the property could be let for. Some smaller premises pay reduced rates or none at all through small business rate relief. Rates and relief schemes change, so check the current position on GOV.UK before you budget.

Fit-out, kitchen equipment, and furniture

The kitchen is where the money goes. A commercial kitchen needs ovens, fridges, extraction, ventilation, and prep areas. Setting up a commercial kitchen typically costs £30,000 to £150,000. Furniture, tableware, and decor for the front of house typically add £15,000 to £35,000. Taking over a site that already has a kitchen can cut these costs sharply.

Licences and registration

Licences and registrations cost less than premises or fit-out, but you generally need the right ones in place before you trade. The main ones for a restaurant are below, each with its statutory fee and source.

Licence costs and rules vary by local authority and can change. Check the website of the local authority where the business is based, and GOV.UK, for current fees.

Stock and initial supplies

Your opening stock covers food, drink, disposables, and cleaning supplies. Essential opening stock is typically £2,000 to £5,000. Order enough to open well, but avoid overbuying fresh food before you know how busy you will be.

Staff: recruitment, first wages, and training

Staff is a one-off cost at launch, then a large ongoing cost once you are open. At setup, budget for hiring, the first month of wages, and training before you open.

Since 1 April 2026, the National Living Wage is £12.71 an hour for workers aged 21 and over. Lower rates apply to younger workers and apprentices. You also pay employer National Insurance and pension on top of the hourly rate. Wage rates change each April, so check current GOV.UK figures.

Technology: EPOS, booking, and payments

Most restaurants need an EPOS (electronic point of sale) system to take orders and payments, plus card readers and often a booking system. A card reader typically costs £20 to £200, and a full terminal £250 to £1,000 or more. Some providers charge an upfront fee for hardware, others spread the cost through a monthly subscription. Factor both into your plan.

Insurance, marketing, and launch

Common cover includes public liability insurance, employers' liability insurance (generally a legal requirement once you employ staff, with limited exceptions), and contents insurance. Basic cover for a small restaurant starts from around £500 a year and can run to considerably more depending on the cover. Set aside a launch marketing budget too, covering signage, a website, and local promotion to bring in those first customers.

The table below pulls the published setup figures together, each with its source. Use it as a template and replace the figures with your own quotes.

Each figure is quoted as published by the named source and figures vary by source. Sources use different assumptions, so ranges do not always align with one another. Build your own budget from quotes for your specific setup.

One-off costs vs ongoing monthly costs

It helps to split your budget in two. One-off costs get you open. Ongoing costs keep you running. New owners often plan well for setup, then run short of cash in the first months, when the monthly bills start to arrive.

One-off setup costs generally include:

• Rent deposit and legal fees
• Fit-out and kitchen equipment
• Licences and company registration
• Opening stock
• Launch marketing

Ongoing monthly costs generally include:

• Rent and business rates
• Staff wages, National Insurance, and pensions
• Food and drink stock
• Utilities (gas, electricity, water)
• Insurance, software subscriptions, and waste collection

A common planning approach is to set aside enough working capital to cover three to six months of these monthly costs. That gives you a cushion while sales build.

London restaurant startup costs

London costs more than the rest of the UK, mostly because of rent. Monthly rent in London can reach £12,000 or more, against £2,000 to £5,000 typically elsewhere. Fit-out, wages, and business rates tend to run higher too.

If you open in London, expect your total budget to sit at the top of the published ranges in this article, or above them for a prime site. Build extra working capital into your plan to cover the higher monthly costs in your first months.

Building your own restaurant budget

Rather than working from a single headline number, consider building your budget line by line. Copy the cost areas from the summary table above into a spreadsheet, then enter a low and a high quote for your own site in each row and total both columns. The gap between the two totals shows how much your final budget could move.

For the working capital reserve, work out your likely monthly running costs, then multiply by three to six months. Adding a contingency of around 10% on top for surprises during fit-out is a common approach. Always plan from real quotes for your site rather than published averages.

Funding your restaurant and managing the money-side

Once you know your budget, the next questions are how to fund it and how to keep the money in order. This section covers both at a high level. For a plan suited to your situation, speak to a qualified accountant or professional adviser.

Common funding routes

New restaurant owners often use a mix of the following:

• Personal savings, which many first-time owners draw on first
• A business loan from a bank or lender, where lenders set their own criteria
• The government-backed Start Up Loans scheme, which offers personal loans to new business owners (check current terms and eligibility on the GOV.UK website)
• Investment from family, partners, or private investors

Each route has trade-offs. A loan must be repaid with interest. Taking on investment may mean giving up a share of the business. There is no single right answer, so it is worth getting independent professional advice before you commit.

Keeping your money organised: a business bank account

Many first-time owners are unsure whether to run the business through their personal account or open a separate one. A separate business bank account from day one is usually the simpler choice. It keeps your takings, supplier payments, and tax money apart. This matters most in the first months, when cash is tight and you need to see what is coming in and going out. Mixing business and personal money makes your accounts harder to manage.

Opening an account quickly helps your cashflow too. The sooner the account is live, the sooner you can pay suppliers and track every cost in one place. When you compare accounts, check the fee structure carefully. Clear, simple fees make it easier to know what you will pay each month and to keep that cost in your budget.

A business account built for hospitality: Zempler Bank

If you need a separate account for your restaurant, pub, cafe, or food truck, Zempler Bank offers a business account designed for hospitality, with a free tier from £0 a month. You can apply in minutes online, and it is generally open to applicants who have been turned away by other banks, including those with a poor or limited credit history.

For a cash-heavy business, you can pay in takings at Post Office branches across the UK. The account also includes cashflow tracking, a savings pot to set aside money for tax, and a free Making Tax Digital tool to help with VAT. Card spending can earn cashback on some plans (Business Extra and Business Pro). Eligible deposits are protected by the Financial Services Compensation Scheme (FSCS) up to £120,000 per customer.