New digs or a new problem? Avoiding the pitfalls of a bad location

By Caileen Kehayas

Every neighbourhood has a dead spot, a space where restaurant after restaurant cycles through, each attempting to overcome the curse that did in the last before succumbing to the sea of red ink that’s formed beneath them. It’s both unfortunate and probable: the median lifespan of a restaurant is a scant 4.5 years, and even less for the mom-and-pop restaurants with fewer than five employees.

A common misconception is that great food and a good amount of capital is a recipe for sure success. There are bevy of reasons, a restaurant can fail. Bad management, ineffective hiring, faulty food costing, bad financial planning, spikes in rent and equipment failure, amongst myriad other problems, can all upend the best laid plans. Location, however, doesn’t have to be one of them. Don’t eye that dead spot thinking you’re the one to turn it around, at least not before some sober analysis. First, consider these location mistakes business owners make when opening a restaurant.

Opening a restaurant off the beaten track

No matter how groundbreaking your menu or how amazing your architecture is, your restaurant is nothing without its customers. Opening a restaurant in a place that is not easily accessible can be hugely detrimental.

When opening your first or fifteenth location, you will want your restaurant in a highly visible and accessible location. Look at your surroundings. If your restaurant is in the middle of Toronto, it’s unlikely that parking will be an issue. But if your restaurant is in a Calgary suburb, you better be sure you have ample, accessible parking for your customers.

Additionally, make sure your restaurant is accessible from main thoroughfares, visible from the road and in a safe area. Up-and-coming neighbourhoods are tempting locales — cheaper rent, diverse clientele, distinctive vibe — but you’ll will want to make sure customers are willing to make the trip there, and that they feel safe when they arrive.

Opening a restaurant in an over-saturated area

On the flip side, don’t open a restaurant right on the beaten track, either. While you would ideally want to open your location in a heavily-trafficked area, you’ll want to make sure you’re not up against too much competition. The hottest strip in town might seem like ideal place to open up shop, but it’s the hottest strip in town — people are flocking there to check out your neighbours, not you.

There might be some room, though. Before opening a location in a saturated area, make sure to do your market research. You don’t want to compete with an established Mexican restaurant by opening up your own just down the street. Make sure you’re serving the needs and wants of the masses and that it’s appropriate for the age and demographics of the neighbourhood.

You want to make sure your restaurant is not lost in the chaos of everything going on around it. Just as it is important to be visible and accessible in a rural or suburban location, it’s important to be able to stand out in a highly-trafficked area, too.

Not making the most of your location

Your location is important, but don’t neglect the details of your building. Once you find a location with good bones, use them to help create your own unique atmosphere.

In Eater, restaurateur Danny Meyer explains that, after he finds his location, he creates a space that’s in tune with it, rather than imposing on it. “More and more what I find interests me is if you give me the frame. I’ll figure out what kind of art belongs inside that frame, and I’ll figure out who to do it with”

Consider how your restaurant fits into its surroundings. Is there a booming jazz scene? Is it a popular sports town? At Toronto’s Carbon Bar, restaurateurs David Lee, Yannick Bigourdan and Franco Prevedello included nods to the room’s previous life as Disney rehearsal space, broadcast studio and nightclub. They uncovered the history of the space and paid homage to it rather than paper over it. Consider these cultural elements and let your location reflect it.

Homework

Before opening a restaurant in any particular location, run the idea through a few filters:

  • Population
  • Business growth trends in the area
  • Proximity to main thoroughfares or highways
  • Large enough lot for restaurant space and ample parking
  • Accessibility
  • Safety of neighborhood
  • Other retail spaces within walking distance

The restaurant business is tough. It’s also easy to get swept up in the romance of running your own floor, pouring wine for friends and dishing out perfect cuisine. But wherever you open up, do your homework first and avoid opening in a subpar spot. Consider speaking to other local businesses in the area. Find out their pain points, struggles and triumphs. They might be your neighbours soon, and you might end up with a lot in common.

Caileen Kehayas is the SEO and Content Specialist at BlueCart, the online and mobile hospitality industry marketplace. When she is not blogging or tweeting, Caileen enjoys hitting the nearest trail for a run, curling up with a good book or watching The Golden Girls. 

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