Currently, dining out is more than just serving great food. Food delivery apps are flooding the market and it’s more important than ever for investors in the food industry to create an outstanding dining experience that allows their customers to feel special. Excellent customer experience begins the moment a customer walks into your restaurant. They need to locate it easily and are assured that they have come to the right place where they can get a meal they have been craving.
This is the main reason for choosing a great restaurant is everything when it comes to your business success. If you were an investor looking for the right home to buy, you would visit Movoto.com and choose a home that suits your needs. Now you need a restaurant. What should you consider when choosing one?
Your budget largely depends on your income minus other operating expenses. According to investment experts, the total occupancy cost includes utility bills, insurance, rent, and other related costs. These expenses should not exceed 6% to 10% of your restaurant’s gross sales.
That means you must invest and time into creating reliable financial projections. Before you sign a lease contract, it is important to make decisions based on reliable data and rent a space that costs less than what you can afford. This is because financial projections can sometimes be a little bit off. So, you need enough wiggle room with the related operational expenses.
Depending on the specific terms of your lease, the rent could increase while you still occupy the premises. So, you should ensure that you can handle various expenses that might show up in the future.
Demographics and location
You should know the kind of customers you want to attract as this is a significant part of choosing the location of your restaurant. For instance, if you want to be serving breakfast and lunch, you should situate your business in an urban community where most people who have 8 to 5 pm job eat. On the other hand, if you intend to be a romantic bistro vibe, it is recommended to open a restaurant where most people congregate during night hours.
After analyzing a few promising sites, it’s time to choose the best location. Sometimes, you may need to talk to the locals and experts just to be sure that you’ve made the best decision for your business. Remember, location and demographics play a key role in the success of restaurants and other businesses in the food industry.
The size of your business
Generally, your business plan must include a rough idea of the expected square footage for effective operations of a restaurant. Though it is possible to scale up or down a business, it would be helpful to consider the available space for rent that can fit within your expectations.
A big restaurant space will require you to spend a lot of money on taxes, utility bills, and insurance costs. On the other hand, too small space will make it challenging for your staff members to operate freely and also limit the number of customers you can serve at a given time.
A good way of estimating sufficient restaurant space is based on the seating plan you intend to implement in your restaurant. Determine the number of tables you should have and the seats you will set up. From there, you can walk backwards and they determine your desired restaurant’s size. Remember, there is no specific formula that you can use but these estimations and help you figure out the size of restaurant you need.
Just like accessibility considerations, laws and regulations regarding safety are evolving. In case you are taking over a restaurant business that has been in use for many years, it is in your best interest to double-check just to be sure that it meets all the security requirements. Also, if you intend to take over a business space that was being used for another purpose, you should make sure that it is renovated to meet the requirements of a restaurant business.
Over the years, restaurant real estate has been changing. Technological advancements and natural forces such as the coronavirus pandemic are changing the way restaurants operate. When choosing a prime location for your business, it is also important to consider other factors such as enough room to grow, availability of parking space, accessibility of your restaurant, competition, and more.
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