Ramen Business Plan: A Ramen Shop's First Year

A ramen shop's food cost is moderate, a tonkotsu bowl costs about $4.70 in broth, noodles, pork, egg and toppings, and sells for $16. What makes it a hard business is time: pork bone broth simmers for twelve hours or more, so the kitchen labor and the gas run before the doors open, and the broth has to be cooled fast at the end of each batch. The plan turns on wages, rent, the build-out with its hood, and seats turned at lunch and dinner. In the example, a Minneapolis ramen shop starts with $228,500, ends its first year about $23,000 behind before the owner's pay while sales build, and makes about $3,700 a month at full speed. Below is each part of the plan, the first year month by month, the startup budget, and a free template.

The short version

• Describe the shop in a paragraph: the street, the bowls, the seats, the goals.
• Cost each bowl: broth, noodles, pork, egg, toppings, the card fee.
• Plan sales by category per $100: ramen, appetizers, drinks, take-home kits.
• Broth simmers for hours: kitchen labor and gas are fixed costs.
• Cool each batch of broth fast, and log it.
• The build-out and hood make the start expensive.
• TaroStack makes each bowl a recipe, so its true cost follows the price of what's in it. More below.

Part 1: the business description

Uptown Noodle Bar, a made-up ramen shop in Minneapolis, Minnesota, writes:

Uptown Noodle Bar is a 1,600-square-foot ramen shop with 44 seats, simmering pork and chicken broths daily, making tonkotsu, shoyu and vegetable ramen, gyoza and buns, and selling take-home ramen kits. In its first year it aims to reach $38,000 of sales a month.

Part 2: what a bowl costs

The broth's cost is bones, aromatics and gas; the hours it simmers are in the fixed wages. How a cooled batch is logged is in cooling log template.

Part 3: the broth, the kitchen and the seats

Broth starts at 6 a.m. for the next day; a prep cook and two line cooks run the kitchen, and two servers work each shift. Lunch is fast bowls for nearby offices; dinner is longer, with appetizers. Each batch of broth is cooled in shallow pans with ice wands and logged, because a stockpot of broth is the classic food that cools too slowly.

Part 4: what each category earns

At full speed the business sells $38,000 a month and keeps $27,340, 71.9%; ramen bring $17,500 of it.

Part 5: the first year, month by month

Fixed costs are $23,650 every month: wages ($14,000), rent ($6,000), utilities and gas ($2,000), ads ($400), insurance ($400), register and software ($250), and other costs ($600). Sales start at half of full speed:

The year's sales are $362,500, and the business ends it $22,981 behind, before the owner's pay. It breaks even at about $32,870 of sales a month, in the eighth month. The lowest cash point, −$35,609 in month 7, is covered by the $45,000 of working cash with about $9,400 to spare. Wages are well over half of the fixed costs, and the broth's hours are paid whether the room fills or not; that's why lunch matters as much as dinner.

Part 6: the startup budget

The $183,500 before working cash is earned back in about four years at full speed. Another counter-service kitchen is in pizza shop business plan, and dumplings to go with the ramen in dumpling business plan.

Get the template

Download the ramen business plan workbook. Four sheets: your categories, each per $100 of sales with its variable cost and hundreds a month at full speed; the first year, month by month, with sales ramping up, profit, cash, the first profitable month, the lowest cash point and whether the working cash covers it; your fixed costs; and the startup budget. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.

Where this stops working

The plan uses one food cost. Pork bones change price, a slow Tuesday leaves broth that has to be thrown out, and nobody knows how many portions of chashu are left until the dinner rush.

How TaroStack does it

TaroStack makes each bowl a recipe, so its true cost follows the price of pork bones, noodles and chashu.

Bowls as recipes. Each bowl is a recipe by weight, so its cost moves when the supplier's price does.

Counts with no signal. The cooler and dry storage can be counted on a phone with no signal, and the reorder list shows what runs out first in days of cover.

Waste with a reason. Broth and chashu thrown out at the end of their days is recorded as waste with a reason, reported by item.

Recipes, counts and the reorder list are on every plan, from $49 a month. The first 30 days are free, with no credit card. If you'd like a hand setting up, ask, and we'll do it with you.

Questions people also ask

How much does it cost to start a ramen shop?

The example budgets $228,500, including $45,000 of working cash; the build-out and hood is the biggest item.

Is a ramen shop profitable?

It can be: the example makes about $3,700 a month at full speed before the owner's pay, after a first year that ends behind.

How much does a bowl of ramen cost to make?

In the example, about $4.73 for tonkotsu: $1.20 of broth, 90 cents of noodles, $2.15 of pork, egg and toppings, and the card fee.

Why is ramen expensive to make?

Mostly the time: broth simmers for twelve hours or more, so kitchen labor and gas run before the doors open.