Have you been exploring the idea of venturing into the restaurant industry? Selecting the perfect restaurant location is crucial for your venture's success. A well-chosen spot can make your culinary vision thrive, drawing a consistent stream of customers and securing long-term prosperity.
Below you'll find 10 proven practices to guide you through the challenges of finding the ideal restaurant location.
The Significance of Your Restaurant's Location
A well-chosen spot can attract more customers because it is easy for them to find your restaurant. Workers on their lunch break or couples on an evening stroll may come across your restaurant and decide to stop in for a bite to eat.
However, a poor location can set you back. Customers may notice other restaurants first, or they may decide not to stop if there is no place to park. Remember the following three pointers while you review this guide:
Choosing the right location ensures visibility, increasing your restaurant's exposure to potential customers.
A location with ample parking and easy transportation provides convenience for customers visiting your restaurant.
Understanding your target customers is essential. Selecting a location that meets their needs can help boost your restaurant's appeal.
Opening a new restaurant goes beyond getting licenses and permits. Whether you're opening your first eatery, or expanding your food truck into a full-service restaurant, you'll know what to do by the time you're read this.
WHAT YOU'LL LEARN...
- Restaurant Licenses and Permits: Open Your Restaurant Legally
- How to Start a Restaurant Successfully
- Restaurant Leasing: Guide to Find & Negotiate the Perfect Space
- Ultimate Guide to Running a Successful Restaurant Business
- Transitioning from Food Truck to Restaurant
- Soft Opening for New Restaurants: Step-by-Step Guide
- Restaurant Location: 10 Ways to Find Your Perfect Restaurant Spot
10 Essentials When Selecting Your Perfect Restaurant Location
Choosing a location that enhances your restaurant's success can be overwhelming. Fortunately, there are 10 practices to guide you through the process of selecting the perfect spot for your venture.
1. Ensure Compliance with Zoning Laws
The first step is to check the local zoning laws to avoid legal issues, such as fines and business closures. Zoning laws differ by area and can influence the types of establishments permitted in specific locations. Ensure that the area is designated for commercial spaces, such as restaurants.
Additionally, determine if alcohol is allowed and verify any necessary permits. Being proactive will greatly help you in discovering an ideal spot that perfectly matches your restaurant's vision and adheres to the regulations set by the local authorities.
2. Analyze Your Target Customer Audience
Choosing a location that appeals to your target customers is crucial. If you are planning to open a coffee shop, a business district would be ideal for customers seeking a cup of coffee before work.
However, in the case of launching a high-end dining establishment, a site in close proximity to a children's museum might not generate as significant a customer base as one situated near a local theater.
For pizza shops or burger joints, proximity to local attractions and nightlife can appeal to young adults, while a family-friendly atmosphere with games works well in suburban areas with many families. Selecting an area full of the demographics you have in mind increases your chances of expanding your customer base.
3. Evaluate Foot and Vehicle Traffic
Foot traffic and visibility are essential considerations when opening a restaurant. By locating your establishment in an area with heavy foot traffic, you increase the likelihood of attracting potential customers. Conversely, a location with limited foot traffic may result in reduced visibility.
Additionally, you want to accommodate customers who arrive by car. Insufficient parking options may lead drivers to choose alternative dining options. Striking a balance between foot and car traffic enables you to cater to a diverse range of customers and maximize your restaurant's visibility.
4. Stay Visible to Stay Memorable
The statement "out of sight, out of mind" is true in the restaurant industry. Your customers need to view your restaurant as they walk by, so choosing a spot behind too many trees or tall buildings may not be ideal. Moreover, they need to be able to see your restaurant from the street as they drive.
Customers interested in your establishment may give up if they cannot find it, while potential last-minute customers may not notice your restaurant at all. A noticeable sign may help capture the attention of new customers.
5. Prioritize Accessibility
Choosing an easy-to-see location is not enough when attracting new customers. They need to be able to reach your establishment as well. In addition to parking availability, you should consider how close your restaurant is to public transportation.
Customers prefer a convenient and short stroll from the bus stop or train station to reach your establishment.
As for those who are driving, you may find success by finding a location on a main street or just off the highway. For pedestrians, it is best to place your restaurant in a walkable spot rather than several miles away from neighborhoods or businesses.
You also need to think about the accessibility inside your establishment. A restaurant without ADA- or ACA-compliant elements may drive some of your business away. Creating an establishment where all your customers can have a positive experience is vital to your restaurant's success.
6. Evaluate the Pros and Cons of Premium Location Costs
A premium location comes with a higher cost, but you may feel placing your restaurant in an area with heavy foot and car traffic is worth the investment. You might come across a location with lower rental costs in an area with lighter traffic, but your restaurant may not attract as much business in such a setting.
Of course, you also need to ensure your business is in a safe neighborhood and near your customer base. Take the time to determine your goals, budget, and customer base, and decide if you want a premium location by weighing the pros and cons around those factors.
7. Examine Space Turnover Patterns
It is important to analyze the space turnover before committing to an area for your establishment's location. One example is checking to see if other restaurants have opened and closed within several months. If this is the case, you should avoid this space because there is a reason behind a quick closure.
While the location may seem to align with your business goals, a space that cannot hold business is not worth the investment. Research an area carefully for months or even years before placing it on your list of potential locations.
8. Minimize Competition
The competition surrounding your restaurant can make a big impact on your establishment's success. There is nothing wrong with healthy competition, but direct competition with popular chains is a bad idea unless you are sure you can perform well against them.
Unless you can offer something that is certain to make customers choose your restaurant over these chains, your business may fail before it gets off the ground. You can choose a location near other local establishments, but you need to work hard to ensure your menu stands out and appeals to customers.
When selecting a location, be sure to check out the competition and keep track of upcoming openings to avoid any issues.
9. Look Out for Complementary Businesses Nearby
Opening your restaurant near complementary businesses is a win-win situation because everyone has the opportunity to increase their customer base, especially when you can reach your target customers.
If your restaurant focuses on a healthy menu such as smoothies and salads, consider placing it next to a yoga studio for hungry customers who do not want to ruin their diet. A pizza shop can be placed next to an arcade or video game store, while a coffee, donut, or sandwich shop is ideal for office buildings because they appeal to busy workers.
If you are planning to launch a food truck, consider a spot near a local park to attract hungry visitors.
10. Explore Collective Venue Options
If you find yourself limited by budget constraints, exploring options like a food court or food truck area can be a fantastic alternative to setting up a standalone restaurant.
Your foot traffic is increased by hungry customers who are already browsing the venue. Use this extra visibility as a chance to promote your business with signs, samples, and deals.
You may even be able to collaborate with other restaurants within the venue. The money you save on opening at a collective venue can be put toward relocating or opening a second location as a standalone restaurant.
Location Selection: Quick-Service vs. Full-Service Restaurants
Part of choosing a location is factoring in whether your planned establishment is a quick-service or a full-service one. The unique requirements of each style can impact the selection process.
How to choose a QSR location
Convenience is a priority for customers who visit a quick-service restaurant. You can appeal to a variety of customers looking for a quick meal by choosing a location in or near shopping centers, business districts, and transportation facilities.
Your restaurant may not require a large number of parking spaces if diners don't linger. However, adding a drive-through might add extra appeal for customers who are in a hurry.
How to choose an FSR location
A full-service restaurant entails a broader range of factors to consider. Customers are looking for a captivating atmosphere, adequate parking, and a close distance to home. Furthermore, you should have an ideal customer in mind.
For example, your customer base might be busy professionals, young adults, or families with young children. Finally, you need to research the competition in the area, especially if there are more established chains nearby.
FREE Resources for Restaurant Owners
Three Insider Tips and Tricks for Restaurant Location Scouting
A strategic approach is necessary for finding the perfect spot for your new establishment. Successful scouting will help you navigate the complexities of finding the right location.
1. Allocate Adequate Space for Delivery and Pickup
As online ordering and food delivery services continue to grow in popularity, accommodating these services is crucial for your restaurant's success. Therefore, you need to ensure your location offers enough space for delivery drivers to park and pick up orders.
You also need a designated area for customers to pick up their takeout orders without disrupting dine-in guests. Leaving enough room for online ordering and food delivery services provides a convenient experience for all customers.
2. Engage a Building Inspector's Expertise
Hiring a building inspector should be a top priority when selecting a location. You never want to open a restaurant on a property that does not meet local safety and health regulations. A building instructor has the knowledge and experience necessary for identifying code violations, structural issues, and safety hazards.
They can also give you advice on bringing the property up to code or suggest looking for a location elsewhere. Failure to have the property inspected before opening your restaurant can result in fines and temporary or permanent closure.
3. Unveil Insights into Space Turnover
As mentioned earlier, you need to research the space turnover for the property you have in mind. A spot with businesses that open and close in just a few months is a sign to look for another location.
Conversely, an area full of established, long-term businesses should go on your list of potential locations. Even if the area sounds like a good fit, you need to ensure your restaurant has the opportunity for long-term success.
Case Study: Restaurant Location Selection
When choosing a location for your restaurant, it helps to research successful businesses to determine how they found the right spot for their establishment.
Huddle House is a great example of a restaurant franchise that has taken the time to select a location. By viewing even a portion of their formula, you can determine the best steps to take when scouting your restaurant's location:
- A minimum population of about 12,000 and within five miles of rural areas.
- If possible, interstate locations with a minimum traffic count of 24,000 and a population of 7,000 to 10,000 within three miles.
- Retail stores within one mile of the location.
- 25,000-square-foot lot size at minimum or an adjoining lot with shared parking, as well as 36 parking stalls at minimum.
- Accessibility inside and out is a top priority.
- Takes less than 30 minutes to travel to the restaurant.
- Learn the zoning laws to ensure your restaurant meets the safety rules and regulations.
- Research the demographics and learn your target customers' preferences.
- Evaluate foot and car traffic in potential locations.
- Prioritize visibility to attract customers on foot and in cars.
- Consider accessibility for both customers and deliveries.
- Weigh the pros and cons of a premium location.
- Research space turnover to determine stability and success.
- Assess the competition and avoid a location next to bigger chains of the same niche.
- Look for complementary nearby businesses to increase your customer base.
- Consider placing your restaurant in a collective venue for shared resources.
By following these proven practices, you can make informed decisions when choosing the perfect restaurant location. Remember, finding the ideal spot sets the stage for your restaurant's success. Stay confident and enthusiastic as you embark on this exciting journey toward culinary achievement, and you can reach your business goals before you know it.