Know Your Market Before You Build
It’s estimated that up to 30 percent of all restaurants fail within the first year of business and up to 60 percent of all restaurants eventually shut their doors for good within the first three years of business. Yes, the restaurant business is highly competitive and there’s a lot of turnover. But much of this failure can likely be avoided if a restaurant owner simply knows the market before building a new establishment. This post will take a closer look at what to take into consideration before restaurant construction begins.
Knowing the Market: Factors
Here’s a look at some key factors to know regarding the market you’re looking to build in:
If you’re looking to build in a college town or city comprised of young professionals, you’re probably going to want to adjust your establishment accordingly than if you were breaking ground in a city with a high senior citizen population or one that’s rich with families.
Planning to open an Italian restaurant? Make sure you know whether or not there are any other similar entities in the area and use that information to either adjust your theme or offer things that they don’t have to give yourself a competitive advantage against them. This doesn’t just go for Italian establishments, but for any style of restaurant. For instance, maybe you can offer car side to-go, delivery or outdoor dining for those pleasant spring and summer days. These are the things that could set your restaurant apart from the others.
Find out what the median income in the area is before you decide on how classy your establishment is going to be. After all, if you’re planning to break ground on a luxury restaurant in a community where the average resident won’t be able to afford the types of prices you’ll be charging, you’re going to have a big problem.
How is your restaurant going to stand out from the other restaurants in your area? This is something you have to plan for. Perhaps it’s in designing the building so that it has an “open kitchen” where guests can see their meals being prepared. Or maybe you’ll install a large bar for watching sports. It might even be worthwhile to invest in conducting a survey with residents in the community you’ll be opening in to get a better feel for what exactly they want in a new restaurant. This can give you a good idea of what to include while going through the construction process.
The restaurant business is very competitive. If you don’t have a plan of action in place long before you open the doors to your establishment, you’re likely going to be fighting an uphill battle after your grand opening. So be sure you know your market before a shovel hits the ground – you’ll be much better served in the long run.