How Much Does It Cost to Start a Restaurant in Minnesota?

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Starting a Restaurant in Minnesota typically costs between $171,500 and $735,000, with a median estimate of $367,500. Minnesota’s cost of living is 2% below the national average, which helps reduce operating expenses like commercial rent and labor. LLC formation in Minnesota costs $155 to file. Most restaurant businesses take 6-12 months to launch.

Last updated: March 2026

Restaurant startup costs illustration — typical equipment and setup

How Much Does It Cost to Start a Restaurant in Minnesota?

Low

$171,500

Medium

$367,500

High

$735,000

National average: $175,000 – $750,000

Interactive Startup Cost Calculator

Startup Cost Calculator

Restaurant in Minnesota

Budget:

Commercial Space Lease & Build-Out

$78,400

Commercial Kitchen Equipment

$88,200

Furniture, Fixtures & Decor

$29,400

Licenses & Permits

$7,840

POS System & Technology

$7,840

Initial Food & Beverage Inventory

$14,700

Insurance

$9,800

Marketing & Grand Opening

$11,760

Working Capital Reserve

$78,400

Pre-Opening Labor & Training

$19,600

Uniforms & Smallwares

$9,800

Options

Include 3 months working capital

Employees:Just Me1–34–10

One-Time Costs

$355,740

Monthly Costs

First Year Total

$355,740

Full Cost Breakdown

Cost Category	Low	Medium	High	Notes
Commercial Space Lease & Build-Out	$29,400	$78,400	$196,000	Build-out costs vary enormously depending on whether the space was previously a restaurant. Turnkey restaurant spaces save $50K-$150K.
Commercial Kitchen Equipment	$39,200	$88,200	$196,000	Used equipment can cut costs by 40-60%. Hood system alone can cost $15,000-$50,000 installed.
Furniture, Fixtures & Decor	$9,800	$29,400	$78,400	Budget 30-50 per square foot for full-service dining. Fast-casual concepts spend less.
Licenses & Permits	$1,470	$7,840	$49,000	Liquor licenses vary wildly by state — from $500 in Wyoming to $400,000+ in New York City.
POS System & Technology	$1,960	$7,840	$19,600	Toast, Square for Restaurants, and Lightspeed are common choices. Monthly SaaS fees add $200-$500/month.
Initial Food & Beverage Inventory	$4,900	$14,700	$34,300	Typically 1-2 months of projected food costs. Full-bar restaurants need additional beverage inventory.
Insurance	$3,920	$9,800	$24,500	Restaurants pay higher insurance rates due to slip-and-fall risk and food safety liability.
Marketing & Grand Opening	$2,940	$11,760	$29,400	A professional website and Google Business Profile are essential. Budget for first 3 months of digital marketing.
Working Capital Reserve	$29,400	$78,400	$147,000	Most restaurants take 6-12 months to break even. Undercapitalization is the #1 cause of restaurant failure.
Pre-Opening Labor & Training	$7,840	$19,600	$49,000	Allow 2-4 weeks of pre-opening training for kitchen and front-of-house staff.
Uniforms & Smallwares	$2,940	$9,800	$24,500	Budget $150-300 per staff member for uniforms. Smallwares often overlooked in initial budgets.
Total Startup Cost	$133,770	$355,740	$847,700	Required costs only

Licenses & Permits in Minnesota

General Business License

Minnesota does not have a statewide general business license. Businesses must register their entity with the Minnesota Secretary of State and register with the Minnesota Department of Revenue for sales and use tax and withholding tax purposes. Some Minnesota cities require local business licenses, though this varies by municipality. Minneapolis and Saint Paul have their own business licensing requirements. Many business types are regulated through specific licensing programs at the state level.

Industry-Specific Licenses

Food Handler License — Minnesota Department of Agriculture or Local Health Department
Cost: $100-$800 • Renewal: Annual
Residential Building Contractor License — Minnesota Department of Labor and Industry
Cost: $150-$500 • Renewal: Annual
Cosmetology Salon License — Minnesota Department of Labor and Industry — Board of Cosmetologist Examiners
Cost: $50-$150 • Renewal: Annual
Real Estate Broker License — Minnesota Department of Commerce — Real Estate
Cost: $150-$400 • Renewal: Annual
Child Care Center License — Minnesota Department of Human Services — Child Care Licensing
Cost: $50-$200 • Renewal: Annual
On-Sale Intoxicating Liquor License — Minnesota Department of Public Safety — Alcohol and Gambling Enforcement or Local Authority
Cost: $300-$3,000 • Renewal: Annual
Cannabis Retailer License — Minnesota Office of Cannabis Management
Cost: $2,500-$10,000 • Renewal: Annual
Pesticide Business License — Minnesota Department of Agriculture
Cost: $50-$200 • Renewal: Annual

Home-Based Business Rules

Minnesota municipalities regulate home-based businesses through local zoning ordinances. Minneapolis allows home occupations in all residential zones with restrictions on customer visits, signage, and deliveries. Saint Paul has similar home occupation rules. Minnesota's rural areas are generally very accommodating of home-based businesses. The state's Cottage Food Law specifically supports home-based food production and direct consumer sales.

Resources

Monthly Operating Costs

After launch, plan for these ongoing monthly expenses for your Restaurant:

Low

$25,000/mo

Medium

$60,000/mo

High

$150,000/mo

Revenue Potential

Annual Revenue Range

$400,000 – $2,500,000 (annual)

Profit Margins

3-9%

Break-Even Timeline

12-24 months

How Minnesota Compares to Neighboring States

Minnesota is close to the national average for Restaurant startup costs, with a cost-of-living index of 98. Compared to neighboring Wisconsin ($356,250 median startup cost), Minnesota has higher costs for a Restaurant.

State	Est. Cost	LLC Fee
Minnesota (current)	$367,500	$155
Wisconsin	$356,250	$130
Iowa	$341,250	$50
South Dakota	$363,750	$150
North Dakota	$371,250	$135

Common Mistakes to Avoid

1
Underestimating build-out costs — always get 3 contractor bids and add 20% contingency
2
Skimping on working capital — restaurants need 6+ months of reserves, not 2-3
3
Opening without a trained management team in place before day one
4
Choosing location based on low rent rather than foot traffic and demographics
5
Ignoring the true cost of a liquor license — budget $10,000-$50,000+ depending on your state

Next Steps to Launch Your Restaurant

1
Register your Restaurant as an LLC with the Minnesota Secretary of State ($155 filing fee)
2
Apply for a Minnesota restaurant food service license and food handler permits for all kitchen staff
3
Obtain a Certificate of Occupancy and pass the Minnesota health department commercial kitchen inspection
4
Apply for a liquor license from the Minnesota Alcoholic Beverages Control board (6–18 month process — start early)
5
Complete your commercial kitchen build-out and pass the fire marshal inspection before opening
6
Get restaurant-specific insurance: general liability, commercial property, liquor liability, and workers comp ($5,000–$15,000/year)
7
Set up your restaurant POS system, reservation platform, and online ordering integration
8
Hire and train kitchen and front-of-house staff 2–4 weeks before your soft opening

Frequently Asked Questions

Opening a restaurant costs $175,000 to $750,000, with the national average around $375,000. A small fast-casual concept can open for $175,000-$250,000, while a full-service sit-down restaurant with a full bar typically costs $400,000-$750,000.

The three largest expenses are: (1) commercial kitchen equipment at $40,000-$200,000, (2) lease and build-out at $30,000-$200,000, and (3) working capital reserves of $30,000-$150,000. Equipment and construction together often account for 60% of total startup costs.

Budget 3-6 months of operating expenses as working capital, which translates to $25,000-$150,000 depending on your size. Most restaurants don't break even until month 6-12, so you need cash reserves during the ramp-up period.

Expect 6-12 months from lease signing to opening day. Health department inspections, permit approvals, contractor scheduling, equipment delivery, and staff training all take time. Plan for at least 8 months if building out a raw space.

Full-service restaurants average 3-9% net profit margins. Fast-casual concepts can reach 6-9%, while fine dining often operates on 5-7% margins due to higher labor costs. Food cost should target 28-35% of revenue.

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Start a Restaurant in Other States

See the national overview for Restaurant or browse all businesses you can start in Minnesota.