Where is the Best Place to Open a Restaurant?

Best Restaurant Locations 2014

Where is the best place to open a restaurant?
Where is the best place to open a restaurant?. DAvid Mark via Pixabay

One of the most important factors in the success of a restaurant is its location. It doesn't matter how good your food is or how awesome your staff are, if your restaurant is in a poor location, chances of success are slim. I think that location is often the biggest area overlooked by prospective restaurant owners. They find a great space that would make a beautiful restaurant, the rent is cheap and they think that if they build it, the customers will come.

That usually isn't the case. Typically You really need to go where the customers are. This is varies by area, but generally you need three things: people with disposable income, parking, and visibility.  

Tourism and Restaurant Growth

According  to the 2014 Restaurant Growth Index, from Restaurant Business, the best places to open a new restaurant all have one thing in common: a strong tourist base. The number one spot on the index: Kahului-Wailuki-Lahaina, Hawaii, with over 200,000 visitors each month. Other popular places for strong restaurant growth include Las Vegas, Kappa Hawaii, and Sevierville, Tennessee (Dolly Parden's hometown).  Each of these areas have a eclectic mix of attractions that bring in many visitors. Findlay,Ohio was also listed among the top five best locations, thanks to industrial growth that has led to an increase in business travel.  

How to Choose a Good Restaurant Location No Matter Where You Live 

So what if you If you aren't willing or able to relocate to Hawaii or Las Vegas?

 You can still open a new restaurant closer to home if you are smart about the location. The first step in evaluating an area for a new restaurant is to look at the current restaurant climate.  Are there restaurants doing well? Or are they opening and closing at a rapid pace? You want some healthy competition - it shows that there are enough people who like to dine-out, who can help support a new restaurant.

 

The next step is evaluating the space for a new restaurant.  If you are considering a place that isn't currently a restaurant, will it be big enough to house a dining room, kitchen and storage? Will your start-up budget cover the rennovations? Will the lease be affordable? Is there enough parking? According to the National Restaurant Associations' 2014 Restaurant Industry Pocket Factbook, 67% of consumers cite parking as a factor when choosing a limited service restaurant. If you are considering a location in a busy downtown area, is there ample foot traffic to attract walk-ins? What does the are look like at different times of the day or week? For example, if it is a busy place Monday through Friday, is it also busy on the weekends? Finding out all this information can help you write a solid business plan, which is the next step in opening a new restaurant. 

What About Destination Restaurants?

If I were to open a restaurant again (which I won't) I would do a destination restaurant. Destination restaurants are the exceptions to all the rules I just listed. A destination restaurant is just as the name implies - people go out of their way to get there.  Fine dining restaurants are often destination restaurants.

These are not typically found adjacent to a shopping mall or interstate exits. These types of restaurants have built a reputation largely on word-of-mouth.

 

References

http://www.restaurantbusinessonline.com/boosting-sales/best-and-worst

https://www.restaurant.org/Downloads/PDFs/News-Research/research/Factbook2014_LetterSize.pdf