August 27, 2018

Location, Space, & Vibe: How to Set the Scene for a Winning Restaurant

Location, Space, & Vibe: How to Set the Scene for a Winning Restaurant

Location, location, location.

Those are the three most important parts of real estate, as the old saying goes. And that’s true for your restaurant, as well — your location is one of the most important choices you face as a new owner or manager.

Choosing and styling your location may seem daunting.

But even though this is one of your biggest decisions, it doesn’t have to be as hard as it sounds. There’s a lot of good advice out there that can help you make smart choices when it comes to your restaurant location and real estate.

How to Choose the Right Space for Your Restaurant

When opening a new restaurant, the right space can make or break it, regardless of how great the concept is. Obviously, there’s a lot that goes into choosing a space that will help your restaurant succeed.

Let’s start with the basics: renting economics.

Your budget will be the single most important factor in choosing a location, especially since rent will be your restaurant’s largest fixed cost. No matter what, you have to work within a reasonable rent budget that you’re able to afford. The initial stages of opening up a new restaurant are costly enough, make sure you plan ahead so that this tough time isn’t made harder with an outrageous rent.

There’s some debate about how much is actually the right amount to spend on rent. You should do some market research first, and determine the average price per square foot for retail rentals in your area, particularly in neighborhoods where you think your restaurant would do well. Then, you need a projection of your expected sales. The general rule of thumb for restaurant rent is that the total cost of occupancy (including rent, insurance and any additional costs for taxes) should be around 6-10 percent of your gross sales. That means if you expect to gross $1 million in your first year, your occupancy costs should range from $60,000 to $100,000 yearly. There’s some argument that 8 percent is the best figure, but some give and take is OK.

Keep in mind that the rent price for restaurants can often be negotiated. Particularly if the location has been vacant for some time, there is likely room to haggle with the landlord and secure a lower price. It’s common for restaurants to negotiate pro-rating rent, or not beginning to pay until the restaurant opens for business. It may also be possible to pay a low rent your first year and gradually increase it after that.

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Once you have a budget in mind, it’s time to choose your location.

Remember that a great location can often make a restaurant, but a great restaurant is less likely to be able to make a location. At the same time, don’t stress if you don’t find a location in the first month. Successful restaurateurs have reported taking anywhere from a few months to nearly three years to find the right spot.

Be flexible with your vision, because the location may be more important than the space itself. No matter how much you’ve envisioned what your dream restaurant looks like, it’s probably worth it to redesign it to fit a space in a great, lively location.

And once you’ve chosen the perfect space, your work isn’t over. It’s important to do some legwork to make sure the space is as good as it appears to be. Talk to other tenants at that location, if there are any. Perform a background check on the landlord. And know exactly what’s included in your lease so there aren’t any disputes down the road over building maintenance or renovations. Legal counsel is probably a good idea at this step, just to help you sort through everything and know exactly what you’re signing.

Make the Space Your Own

Once you’ve signed the lease, the work is just beginning. It’s time to style your location in a way that will bring your restaurant vision to life, but without getting too expensive.

When you plan the interior of a restaurant, there are some functional considerations.

A great restaurant design is laid out in a way that:
  • Keeps travel distances short
  • Keeps waste disposal out of sight of guests
  • Separates the dining and kitchen areas
  • Separates the movements of guests and staff and ensures there are no crossover paths
  • Encourages a one-way flow of traffic through the space
You should also consider design best practices for all spaces.

Keep in mind such principles as embracing natural light and sticking to a neutral color schemes to create the kind of space customers can embrace and want to spend time dining in.

How you decorate will depend a great deal on your restaurant concept. For example, a fast casual restaurant and a fine dining establishment will not look the same.

But there are some design principles that any restaurateur can implement to make a space look its best on a budget.

Outfit the space with good-looking, but low maintenance plants, like ferns or succulents. Greenery can make an indoor space look much brighter and more inviting.

You can also get creative with your lighting. Edison bulbs or string lights are a few current design trends that are low-cost and look great in almost any space.

Another way to add some life to your space is to offer non-traditional seating. Booths and stools are all too common, so think about going with colorful re-purposed chairs, or mix-and-match seating styles all done in your color scheme.

And an easy way to add decor to your restaurant without having to drop a lot of cash is to open your space to local artists to exhibit your work. You’ll get a rotating set of decor for free, and build goodwill in the community while you’re at it.

Moving Up and Out

Moving is a huge hassle for a restaurant, but sometimes it needs to happen. Maybe your old lease is up and the landlord isn’t interested in renewing. Maybe you’ve outgrown your current space.

Whatever the reason for a move, there are ways to make it as painless as possible.

First, you’re back to square one in choosing a location. Carefully research new spaces, keeping in mind everything you’ve learned as you’ve operated your restaurant so far. The new space should offer benefits you didn’t have at your old space, so keep that in mind as you’re looking.

Once you’ve chosen a new location, you need to let your customers know about your planned move. Hopefully, you have a customer database you can use to send out an email or a postcard to customers to give them a heads up on the move. If not, talk to customers about the move as they come in. Announce your plans on your website and social media. Posting progress updates about the move on social media is a good way to keep your customers engaged and get them excited about your new location.

If you’re moving somewhere far from your old spot, it might be a good idea to offer incentives to your customers to entice them to make the trek to visit you again.

Carefully time your move to have the least possible impact on your sales.

If you’re able to move over a holiday break or your normal closed days to avoid having to shut the restaurant down during the move, that’s best. And when you move your equipment and furniture into the new space, it’s usually best to hire a professional moving company to help.

Doing it yourself might seem like a good way to save money, but it’s possible you could damage something and end up spending more than you would had you just hired the movers. Most moving services will also come with insurance and all the boxes, trolleys, blankets and other supplies you need.

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Finally, once you’re settled in the new space, host an event for your grand re-opening.

It’ll help get customers, old and new, excited about your new space. You could also offer giveaways or discounts during the opening to give loyal customers and locals to your new a spot an incentive to check it out.

Obviously, there’s a lot that goes into choosing a space - but these tips have been shown to lend to success.

Good luck! 

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