An advice that future restaurant owners should never neglect would be to always keep the location in mind. When starting a restaurant business, it pays to look into your soon-to-be business’ location because of the myriad of advantages it can bring. This is true to the point where it would be disadvantageous on your part to exclude it from your restaurant business plan. With that said, there are things that you must take into account when choosing a location. Here’s what those things are:
Identify Target Market
A key element in figuring out what the perfect location for your restaurant is your target market. Customers are the lifeblood of your business, so it makes perfect sense to figure out who they are and what they want. There are many methods you can use to help you in identifying your customers. Having a customer analysis template and a customer expectations survey can do wonders for your business. If you really want to figure out your market, here are specific considerations that you’d want to look into:
-
Describe your Customers
To know who you are catering to, you need to have knowledge about the smaller details of your customers. This means looking into things like their age, where they come from, their culture, educational level, and finances. For you to provide for their demands and to select the right location for their benefit, these are tidbits that must be uncovered.
-
Understand Their Habits
Pragmatically speaking, you’d want to learn as much as you can about what your target market does and what they don’t do. Are they likely to walk around or do they drive? Do they prefer to eat in or is to go just as appealing as an option? Ask questions like these and you’ll be that much closer to pinning down their identity as a whole.
-
Where are they Located
The question of where to find a location for your restaurant should also involve a similar question: where are your customers? Let’s say your target market is primarily those in the workforce. This means looking for a space in more commercial areas. What if your target market is mostly kids or families? Spaces near schools and residential areas might make more sense.
-
Are There Enough of Them
Questioning the size of your market makes sense in this context because you wouldn’t want to rent a large and costly area for a select group that needs far less. Or something that’s the exact opposite. If there aren’t enough of your targeted customers in an area, it wouldn’t make sense to pick that location. Find a place where you can get a lot of prospective customers and your success will be practically guaranteed.
-
Customer Activity
Unlike the case where you identify your target market’s habits, this is where you monitor their activities. Do not generalize; instead look into specific acts. In doing so, you can better learn what they want and need, which prepares you for your own future decision-making.
-
Competitor Analysis
As you go on identifying your customers, you must also find the time to check out your competitors and analyze what they do. See how well they match up against you in various areas; consider where they are strong, what their weaknesses are, how unique they can be, and more. Doing this competitor analysis can help you decide which location is strategically viable and which ones put you at a competitive disadvantage.
Visibility
A strong aspect to consider about choosing a location is how visible it will be for customers. Try to imagine a scenario where there are people who have never heard of your restaurant. Would your restaurant’s location allow those people to discover it on their own or will it stay hidden? Below are three things about a potential location that you must look into:
-
Foot Traffic
You can define foot traffic as pertaining to the pedestrian visitors your restaurant business will be exposed to. Securing your establishment in a commercial space is bound to attract more foot traffic than having it within a quiet, suburban area for example. The customers that encounter your restaurant in this case may or may not have been exposed to any marketing efforts at all. Just the sheer fact that they can encounter it while they go about their daily routine makes the consideration of foot traffic incredibly important.
-
Vehicle Traffic
This is similar to the entry above, except your potential customers are driving or riding a vehicle at the least. For customers on the go, how accessible is your restaurant? Is it something they’re likely to encounter on their way home or to work? Many of the questions that applies to foot traffic also applies here.
-
Nearness
Look back at your defined target market and see if a prospective location is near them. People want convenience, so this helps in giving them just that. As much as possible, get a location where your target market doesn’t have to travel far or labor too much in getting there.
Demographic Considerations
Going back to your target market, you need to look into specific areas of their lives in order to better identify them. These areas are important due to their role in how your customers interact with you and your business. Regarding how your restaurant’s location plays a role into all this can be explained in each individual consideration below:
-
Income
Let’s say you decide to rent out a space in a mall. The rent for this space would be a lot heftier than if you chose somewhere that’s less commercially viable. Naturally, this would affect how much you price your dishes. Knowing how much your target market earns should be considered since some may find a restaurant in a mall much more extravagantly priced than they hoped.
-
Age
If your target market is predominantly those below the age of eighteen, you’d be hard-pressed to find success if your location is accessible mostly to those who are in the workforce. The same goes if your restaurant is located next to a school and you’re looking to cater to much older markets.
-
Geographic Region
To put it simply, if your customers are not anywhere near where your restaurant is located, then you’ve got a problem on your hands. Find out where they are and choose the right location based on what you find out.
-
Gender
There are certain locations that might appeal more to men than women and vice-versa. If your restaurant caters to both equally, then your choice of location needs to reflect that.
-
Marital Status
Are your customers mostly single or are they married? Determine this and select a place that better suits their marital status. You may even be tempted to tweak your concept into an establishment where single people can mingle with each other or where married couples can frequent and bring their kids along. As long as your location is appropriate towards their status, you should see a greater success rate with your restaurant.
Easy Parking
When it comes to locations, this article has mentioned before how the desire for comfort comes into play. People tend to prefer driving to their favorite places than walking and where there are drivers comes the need for a space to park. Finding a location with ample parking opportunities will be a huge boon for your business. You’ll be keeping your paying customers happy with this decision, especially if it keeps them from receiving unwanted parking tickets.
Accessibility
You’ll be doing your business and the public a huge favor by taking those with disabilities into account. Customer experience can make or break your restaurant, so finding a place that can help you make things better for the impaired is essential. Size can immediately come to mind as a consideration; those in wheelchairs will have trouble moving around if your space is too small and they end up bumping into tables and chairs too often.
Another thing to consider would be ramps and stairways. If your chosen location depends too much on stairs and doesn’t have enough ramps for those who can’t or has trouble walking, then you’ll be dealing with complaints or the complete loss of certain customers. Automatic doors are also much friendlier for the disabled to deal with, so having a place that can accommodate this feature would be much recommended.
Affordability of Space
As perfect as a potential place might seem, the costs and the deals you’ll have to make can help determine its true value to you. There is a need to always consider the details of its rental, lease, renewal agreements, and more. Below is an in-depth look at what it means to handle those nuances.
-
Rental
Unless you plan to build your own facility from the ground up, renting out a space will be an inevitable scenario for you. As you approach a prospective location, be as thorough as you can about the rental agreement. Discuss this with the landlord and leave nothing off the table. Bring up your budget and if difficulties are bound to arise, prepare to talk about payment systems and how you can make it work for both of you. As you seal the deal, don’t neglect the rental receipt; keep it as a record of your transactions with the landlord.
-
Lease
Concerning the lease agreement, there are a few basics that you need to be mindful of. First, it needs to specify who the agreement is between. Second, the property’s full mailing address must also be specified. Third comes the rental lease term, or the time period when this contract remains valid. The amount you agreed to pay is another detail that needs to be specified, and lastly there’s the acknowledgement. Signed copies of the agreement must be kept for recording purposes.
-
Purchase of Space
After you’ve gotten the space that you’ve been eyeing, the next move would be to focus on the asset purchase agreement. The major purpose of this is to help define and control the behaviour of both parties in regard to the sale made. Iron out the details of this agreement with your landlord or the seller of the property you’ve acquired. As with all aspects of the business that deal with legal issues, it is recommended to consult your attorney in this matter.
Analyze the Neighbourhood
It would help for you to get a closer look at interactions in a particular neighbourhood regarding land use. A good way for you to do this would be to engage in customer analysis. Such methods can be crucial to your restaurant’s marketing plans. Take the descriptions and considerations outlined above and use it to create a demographic and behavioural profile. Having a customer analysis template to model your efforts after would make this part of the business much easier to accomplish.
Safety
Now that you’ve gone into detail with your customers, competitors, finances, and all the considerations in between, the last thing to deal with would be the issue of safety. One thing that would be a massive help to you would be a restaurant safety checklist. As you know, there are multiple hazards that any restaurant can fall prey to. Burns, cuts, falls, and the like all cause serious injuries. Those risks are applicable not only to your staff, but even to customers.
Being proactive in safety measures and prevention can mean anticipating and coming up with solutions to even the smallest risks. Use your intimate knowledge of your own business and analyze what potential hazards are likely to occur. Some are quite common across multiple restaurant types, but there are those that are a bit more specific to individual establishments. Be aware of the areas of focus and as early as now, prepare pragmatic solutions that can help you in both prevention and recovery from such troubles.
As you can see, there are a lot of considerations to take into account when choosing the right location for your restaurant. In addition to said considerations, there’s also the necessary restaurant templates and documents that will require your attention. Take note of what’s been said above and use your instincts as a business owner to come up with the best decisions for your restaurant. With the right guidance and information, the risks and difficulties of establishing your business should be lowered considerably.