Finding a right location is probably the most important part in a successful restaurant. And as with all property, "location, location, location" will be the dominant factor affecting value now, and when you come to sell. Never compromise on location, because whilst a secondary location for your business model may secure a cheaper rent, your sales forecast and restaurant potential is unlikely to be fully realised.
Once you have found your site, do your homework, understand and visit the existing and future competition. Think about are there enough people in the area to support your business?
Look at Local Area Demographics.
As the prospective owner, I strongly advised you to do a little digging into the local demographics. This involves researching characteristics of the people who live in the town and neighborhood in which you are thinking about planting your restaurant. Some of the most important demographics to consider include:
Age groups. Different people want different things from their community. As such, predominant age groups within an area will affect the business trends a restaurant sees. Ideally, you should situate your restaurant in an area with people who will frequent your establishment. For example, if the groups are students you should set the prices that are affordable and if its suited in office area it should be just for a quick lunch.
Population. The number of people in a given area is also important. Research the populations of towns and cities so that you know how large your potential market is. Some restaurants do incredibly well in small towns; others do not.
Income levels. By investigating income levels, you will become better aware of what the people in a given area are willing to spend, or what type of restaurant they would be most willing to visit.
Education level. Educated people, including college graduates and young business professionals, are drawn to certain concepts more than others. The opposite is also true. Consider the education level of the population in the area and how it will affect your establishment before you set up shop.
Crime rate. Criminal activity may be a detriment to some locations, since high crime has the ability to drive down an entire neighborhood. On the other hand, plenty of restaurants succeed in high crime areas. For example, restaurants with bars often find success in inner-city or downtown areas, which are often bustling with activity but usually susceptible to higher crime. Even locations with large populations may see more crime than smaller towns, but from a business perspective the larger city
may prove more profitable.
Parking – Are there enough parking to accommodate all the seats in your new restaurant or is there any public parking near the restaurant location? If you are doing delivery service is there enough parking spaces for your drivers?
Accessibility – Good accessibility means that your customers can reach you easily by road. Make sure your location is close to all major routes in the area and can be found without too much hassle. Most successful restaurant locations (but not all) are easy to find.
Visibility – This goes along with accessibility and is very important for new restaurant locations. People have to know the restaurant is there. This is why property prices in
downtown districts and developed strips are higher than other areas. They offer a level of visibility that can bring in a great deal of walk-in business.
It’s important to understand each of these elements, which you can better choose the right location for your new restaurant.
After you decide on the location there are other things you need to consider ARE YOU BUILDING FROM SCRATCH OR CONVERTING AN EXISTING RESTAURANT?
Contact me to discuss I can help evaluate the Pro and Con.
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