Location influences the success or failure of a restaurant in a host of ways, from attracting enough initial customer interest to being convenient to visit. As a business owner, you want to choose a site that is desirable to customers, but there are other factors that will influence and contribute to profitability.

Sanjeev Sanghera

Sanjeev Sanghera

Many beginners choose spaces for the wrong reasons without doing their due diligence, and then realise that the location matters just as much as – if not more than – the food they serve.

First and foremost, you need to understand your target market as this will enable you to find the right location. Once you have established who they are, then you can analyse the demographics of your chosen location, including gender, age and income among others. Not everyone likes the same foods or restaurant concepts, so by undertaking an analysis, you will determine what appeals to your target demographic.

Visibility is equally important for new restaurants, so setting up shop in a location with either high footfall or passing traffic is perfect. Cost is always a bottom-line consideration and can affect your choice of location and length of the lease, so make sure you carry out a simple scrutiny to ensure that the rent or purchase of the space would not destroy your predicted monthly profits.


Source: Shutterstock / Monkey Business Images

The size of your restaurant will also affect the amount you pay for the lease and utility expenses, among other costs. Another factor to consider is who else is in the neighbourhood and whether it is busy – you do not want to be offering the same food in a quiet area full of empty storefronts.

When choosing the perfect location for your new restaurant, check you are making the decision with your eyes wide open, as it can affect both your costs and profits. The key to success is to be in the right place at the right time, so do your homework before committing to a new site or signing a lease.

Sanjeev Sanghera is co-founder and managing director of Döner Shack