In this article, I’m going to explain to you the seven factors you should consider when looking for the perfect location for your restaurant.
Location, location, location! Real estate agents have that word drilled into their heads, but it’s just as important for you, as a restaurant owner, to find the perfect location to help make your operation a true success.
When you find that strategic site, the perfect location, you’re already halfway to achieving success. It’s important to remember that a restaurant’s location is as important to its success as great food and service.
While still in the business planning stage, it’s important to take the time to consider just what and where your ideal place should be. You should really put location at the top of your to to-do list and start looking right away.
What to Think About When Choosing a Restaurant Location
Don’t just locate your business carelessly, perhaps because of the low rent, or you like a particular location. If you end up in the wrong place, not even God will help you.
Bearing this in mind, here are seven key factors in the search for the best restaurant location for you and your successful business.
The perfect restaurant location is not necessarily the city center or near a tourist attraction. One critical factor to incorporate in your search is that — depending on your location — your restaurant should be easily accessible by car and/or has plenty of foot traffic as well.
Another consideration is that your restaurant location should be easy to explain on the telephone as well as in your advertising and posters (Not more than two lines!). Make it easy to find.
Remember, lots of people get lost just going down the stairs at home!
Here’s an example: “150 London Street, just in front of the American Mall.”
Here’s one that is going to cost you a lot of customers:
“160 Rome Street. Take the Milan Road, at the bottom of the street, after the level crossing, take the third road on your left. Then turn right into the first street past the traffic lights. Get onto the highway for 5 km. Finally, take exit 86d, and you will find the road signs that lead to our restaurant.”
Few people are going to tackle that impressive route to get to a restaurant.
2. Parking Lot
You need to attract new customers, but if you don’t have a parking lot nearby, your restaurant will suffer the effects. Few customers will consider the presence of a parking lot a determining factor in choosing one restaurant over another, but nevertheless, when a customer has a hard time finding a parking spot nearby, you’re losing out.
And it’s important to remember the difficulties disabled people in wheelchairs may encounter trying to get to your restaurant.
Accessible parking is a secret ingredient to your recipe for success
As a final consideration on parking, remember: Customers want to feel safe and added to that, they want to park their car where they can have little worry that someone will dent or scratch their vehicle while they’re dining. A scratched vehicle means you’re unlikely to see that customer again.
Once I advised an entrepreneur not to invest his money in a restaurant where there was no nearby parking. In fact, if you parked a vehicle within a radius of a mile you would be fined. When I pointed that out to the entrepreneur, he only said, “Well, people who want to come to my restaurant won’t mind the stroll.”
Unfortunately, his restaurant lasted less than six months before having to close the doors.
It’s important to know your target clients and be clear on what their habits are and where they like to hang out.
3. Is your target there?
If you have read “How to identify a restaurant’s target customer“, you should know about the focus on finding the right niche for your business. You have to be sure that your niche is right for the people who are likely to come to dine at your restaurant.
You want to locate where the right people will patronize the zone where you intend to open your restaurant.
If you want to open a classy restaurant, does it make a lot of send to open it in an area frequented by young people? If you put up an informal restaurant and entertain customers with live music until late at night, would you open in a quiet residential area?
Stores with plenty of competitors around can create foot traffic. In the case of restaurants, this can affect your revenue. It’s a good idea to check out the neighborhood to see if there are other restaurants nearby.
Are there already too many restaurants in the area? Do any of these have the same concept as yours?
It’s important to avoid price wars or other conflicts and trouble. Furthermore, being compared to another restaurant day after day is exhausting. The best way for you is to try to have your own personality and differentiate your restaurant from all the others. In that way, you not only have a unique business but show respect for the other enterprises in the area.
If you’re seeking your fortune in the food and beverage field in a large city like London, you’re fortunate in that just about any place has nearby transportation. But if you choose to locate in a small city, it’s important to consider public transportation.
Not everyone drives a car, and even vehicle owners often prefer to leave their car at home to avoid parking problems. They come to the city center area via public transportation.
Many tourists too, use public transportation so you want to locate where customers can have easy access to your entrance.
Only a few years ago, an Italian restaurateur visited Lourdes. Upon his return, his small restaurant quadrupled its daily profits. Only a few weeks before the restaurant had been on the verge of bankruptcy. His prayers were answered! The Mayor of Rome reactivated an underground station right in front of his restaurant! A miracle? Well, maybe. I’m just sayin’.
6. Size does matter
Seems as if every time I’m called in to consult an entrepreneur who is considering the first acquisition of a restaurant, I get the same story: “I don’t need a big site. A small kitchen and dining area with a few tables. That should be enough.”
I won’t get into too many technical details, but since I’m writing this article about marketing and successful restaurant operation, I’ll still tell you that size does matter. That doesn’t mean you have to open a huge restaurant.
The size of your restaurant should fit in with your concept.
If you plan to open an informal fast pizzeria, a small space may be just right. If you’re planning a classy restaurant with more expensive menu offerings, then a dining room that is too small with crowded tables may spell doom from the start and you’ll quickly become another bankrupt statistic.
7. Equipped…or running on empty?
Generally speaking, there are three types of restaurant to be considered for acquisition.
1. There are vacant restaurants already equipped with the facilities you need. These are places that have closed down. Having acquired such a location, all you have to do next is clean up and renovate. As long as it comes close to your needs, this could be a way to save considerable money. Nevertheless, you’ll have to bring a wave of freshness and have a good marketing plan in place.
2. Another option is to consider the purchase of a restaurant that is up and running. This, however, can be the most dangerous and reckless option of all. Normally, when a restaurant is working and profitable, there is little reason to sell.
But you have to be wary of the owners who tell you they’re tired and want to retire, or they lost a beloved partner and no longer have an interest in the place. There are a number of reasons for selling that may sound good, but you have to dig a little deeper to find out the real reason for the decision to sell…especially if the price seems almost too good.
There could be something seriously wrong with the restaurant, or perhaps the owner of the property plans to make repairs to neighboring buildings causing blockage of parking facilities and other problems such as noise and dust, etc.
Even if the place is running well, and the owner is really retiring, you should know that statistically, every time a restaurant takes on new management, over half the regular customers disappear.
In one case an entrepreneur bought a very large cafeteria. Great shopping mall, plenty of parking. It had everything. It had been part of a successful and respected chain. Little had to be done. The dining facilities were very pleasant. The well-equipped kitchen needed nothing.
But there were two serious problems that cropped up very quickly. First, the restaurant housed a basement storage area of the same size, meaning the rent was exorbitant, and worst of all, day after day the first few weeks — despite the new sign — customers, most of whom were over fifty, came in and common questions were, “Where’s Fulano?” or “No fish today? But you always have fish.” And so it went. Fewer and fewer customers came in.
Then the owner panicked and had a Chinese cook come in to offer Chinese food. He began placing huge sirloins of beef, whole turkeys, and ham, etc. at the serving table and hired a carver to carve dishes or sandwiches.
Another serious problem arose. Sales purveyors came in and soon the basement was full of unneeded products adding to the owner’s expenses due to his lack of attention.
In less than a year the entire establishment was forced to close due to high expenses and lack of business.
In another example, although the new owners kept the business afloat thanks to their personality and attractive food offerings, day after day, even a year later, despite the new sign over the door, former customers came in and demanded, “Where’s Quidam?” They left and never returned.
An excited client once called to say he had struck a great deal. He had just bought one of the most lucrative and popular pizzerias in Rome. Unfortunately, he hadn’t taken time to fully assess the situation. No one told him that the owner of the building in which the restaurant was situated had made plans to restore the entire building. This meant serious damage to sales because the big popular outside terrace had to remain closed for at least a year.
3. Then the third type would be empty space with no facilities at all. If possible, this could be the ideal solution as you can plan out your space and organize it just the way you want. On the other hand, this can be expensive.
In the long run, this is probably your best solution, but it may require a greater investment of money than other choices.
If you’re willing and search restaurant equipment houses, you may sometimes find excellent and suitable kitchen equipment as well as dining room equipment that you may acquire for a lower price than new.
These are only seven of the more important things to consider when choosing a restaurant location. The list could be endless and there are always exceptions, but trying to be the exception makes for a very iffy operation.
If you have questions or important information to add, please drop a comment below.