Article contributed by Wilson K Lee
Location location location! You’ve probably heard this tune before. Experienced brick & mortar owners love to sing this tune when asked for advice by newer business owners. They spout that song so regularly because location matters a lot. It could be the difference between a restaurant that lasts past year one and one that doesn’t.
In an ideal world, we’d all want to choose that spot in the heart of downtown, the one with the most foot traffic. But of course – that isn’t possible as it comes with a massive price tag. The more affordable choices are ones that are usually tucked away from the main streets or in residential areas or in areas that aren’t as hospitable. Even though they may be more price friendly, there are 4 crucial elements to need to consider when choosing a restaurant location.
Elements that can become an upside or downside for your business. And elements that you may use to negotiate with the landlord to reduce rent costs.
1. Location’s Visibility
Regardless whether your shop is located downtown or not, it won’t matter if people can’t see it or find it! You want to approach this element with a mindset of an individual who has never heard of you before or been to that area.
With that in mind, when you’re looking at each location think about:
- How visible is the shop from a distance?
- Is there anything blocking the view? A tree? Parked cars?
- Where is signage able to placed? Sandwich board allowed?
- When people drive by, can they see the location? Do other stores take the attention?
2. Location’s Crime Rate
When you’re having to pick more affordable locations, it could very well be because of numerous factors that crank down the price. The crime rate being one of them. Aside from your own safety, you need to think about the mind space of your potential customers.
How safe would they feel if they see drug addicts roaming the streets, tents set up around the block and reports of car break-ins in the area? For instance, if you’re starting a fine dining concept, you’d ward off a lot of potential customers because of that neighborhood.
Although that is an extreme case, you need to be aware of the perception the neighborhood has and whether choosing it for your restaurant location would affect your business.
3. Accessibility
“It’s so hard to find parking.” “It’s so far.” “There’s no parking there.”
You’ve probably said something along the line before and so will other people when they think about how easy or difficult it is to be at your restaurant. If you’re catering to a higher end demographic or families, they’ll most likely own cars and find your place inconvenient if there isn’t any parking. If you’re catering to students, they’ll most likely only have access to transit.
So consider the location’s:
- Number of customer parking spots (metered, parking lot, street parking, none)?
- How active those parking spots are (always full, always space, some space)?
- Cyclist friendly (bike lock, location is on a hill or not)?
- Transit friendly (nearby bus stop, nearby train)?
- Level of construction?
4. Location’s Community
Last thing that is crucial in choosing a restaurant location is the community. A lot of people make the mistake of not considering this. I suggest sitting at a competitor’s location and observe. Watch and see if you feel a sense of community. A sense of belonging.
This may be watching how staff and customers interact with each other. Such as, any cues that seem as if they are more than a transactional relationship. Something like addressing by first name or going beyond the usual small talk.
It’s important since it signifies that there are repeat customers who come back again and again. If your restaurant location doesn’t get massive volumes, a community of repeat customers will be what keeps your business afloat.
So watch and see whether customers sit there for a while or they just grab and go. Digest the feelings and see if you feel comfortable. If you don’t feel like you belong within the community, it is a big red flag because you’ll be in that location for years.
Now those are 4 crucial elements to consider when choosing a restaurant location. It’s important to think of them when you visit each potential location.
I recommend writing notes based on these 4 elements for each spot and rank which spots would be in your top 3. The beauty of having these notes is that you can bring them up during negotiation time as ammunition.
The more you do your research and know your stuff, the more likely you’ll be able to negotiate successfully and acquire that perfect restaurant location.
For more small business and restaurant tips & strategies to help you grow, check out Wilson’s Youtube channel, Instagram, and FB group for restaurant owners.
Wilson K Lee is an award-winning Top 30 Under 30 business strategist who has built multi-million dollar businesses like an international Dessert Chain with locations from North America to Asia and event business. He is a Brick and Mortar development expert helping business owners and entrepreneurs create explosive Food and Beverage businesses on https://wilsonklee.com/
