Hi Al, Its me again. We have all heard it A few glasses of Burgundy’s best -“I’ve got this great idea for a great restaurant, we’ll make a fortune selling six star cusine” Roughly translated means “Build a better mousetrap and they will come” and how often dear fellow, does that happen?
With competition for the ever decreasing “leisure £” becoming keener and keener if you are investing in opening a new restaurant or even updating that old place you have in Inversnekie you had better be sure that you have taken a good look at the feasibility of your most recent brainfart.
We are not just talking about the site here but getting together all of the information and research you can from demographics to design. What you are trying to do is make a better informed decision about your concept and if it’s the correct one for your potential location. You’ll remember you recently watched that footballer chap Ramsay’s “Kitchen Nightmares USA”, on his efforts to rescue some upmarket Californian restaurant. A fine example of how we should all understand the perils of opening a fine dining operation with a couple of grill chefs at a property location that can only be classed as “on the wrong side of the tracks”. Location Al – number ONE. You’ll recall that man Forte once said Location, Location, Location – and a long time before Phil and that Jolly Hockysticks woman.
Here’s a quick guide to avoiding choking on your first set of figures.
The Five Stages of a Feasibility Study
Gather the Data
- What’s your market area? Specifically the population / potential customers that the restaurant will serve?
- What are the “demand generators” – commercial, residential, hotel guests that will potentially supply you with your customers?
- What are the demographics of these possible customers? Age, sex, dining habits, income, local traffic patterns, footfalls in your area.
- Are there any plans for changes in the area, big office developments, housing developments or tourism related projects?
Develop a Concept
- Use the data gathered above to develop an offer that fits the needs and preferences of the potential customers in your area.
- Make decisions about theme, menu, opening hours, service style, customer experience and atmosphere
- Define the restaurant concept, describe the restaurant concept and the evaluate the concept referring back to your data
How Good Is Your Site
- Having carried out a local competitive restaurant survey ask yourself the question does my site have the potential to support my concept – or has the guy down the street “built the mousetrap” and beaten you to the marketplace?
Analyse Your Competitors
There are many areas that you can take a look at here, here are a few examples. Survey all restaurants in your area that have the potential to compete with yours.
- Document the features that the competition offer
- How difficult are these restaurants to find?
- Do they have good signs?
- What’s their offer?
- Is their style of service appropriate?
- Is car parking available?
- When are they busy?
Put Together Some Numbers
- What will be your average spend?
- Estimate your payroll
- What will your overheads be?
- Put together a spread sheet showing your monthly cash flow
- Calculate your annual profit or loss!
Now doesn’t that feel better? Enjoy your dinner.
Regards The Concierge