Making the most of your Restaurants Location

Updated September 19th 2013

Location analysis is highly important for successful restaurant marketing. It makes it easier to develop new marketing strategies you can use to attract new business and compete effectively.

As Restaurant owners you need to be alert to any new developments in your surroundings. You need to check the current market trend and any new competition at least once in two months. Environmental analysis basically involves checking the market conditions close by and coming up with ways to utilize any external factors to boost your business and profitability. An ideal location analysis covers general business conditions in your region, number of businesses and citizens living nearby, and what means of transportation your customers have convenient access to.  Take into consideration the traffic near your business and if it is seasonal so you can adapt your marketing plan. No point in promoting to tourists or locals when they are not there.

Before you begin your location analysis it is always important that you understand your trading area and any physical, behavioural, and economical barriers. The radius of your market is basically 3-5 miles from your restaurant as most consumers don’t dine very far from their homes and workplaces. However, if your restaurant is a destination or full service restaurant you can extend the radius of your trading area to about 10 miles. You need to study this area at least once every month or two. Check out all neighbourhoods of your loyal as well as potential customers. Examine any geographical barriers like lakes that affect how customers get to your establishment.  If your trading area has a wide economic range then analyse the areas where the economic class you are interested in lives or works.  It is also important to consider the general behaviour of your target market and what influences such behaviour.

How to Analyse your Environment

Your Environment simply refers to the area around your restaurant. You always have to pay extra attention to any competition or factor that directly affects your business. Apart from such factors, it is also important to analyse the entire region or town during this analysis. Here is how to go about it.

1. First you need to explore your trading area – As explained above this is basically the area located 3-5 miles from your establishment. You need to explore it in order to clearly understand the cultural, economic, and physical conditions in your trading area. You should also identify all direct and indirect competition within your trading area.
2. Next, you need to spy on your direct and indirect competition – It is important to visit all the other restaurants close by to check and rate their food and services. You should lay more emphasis on direct competition and ensure that you note all their strengths and weaknesses. Don’t forget to check on any new competition in the area.
3. Next, study the population within your trading area – It is important to know the demographics of your trading area. You can always conduct an online search or contact the relevant government department.
4. Next, you need to identify any threats to your establishments – Check out any economic, legal, and cultural factors that can adversely affect the operation of your establishment. This will enable you to adapt to any new trends in the neighbourhood.
5. Next, identify any new opportunities – Look for any new business opportunities that can be of benefit to you and adapt accordingly. For instance if a new business opens close by you can market your restaurant to the employees.
6. Finally, check out your own location – This is basically the micro-micro environment around your location. You need to consider how visible your restaurant is from the main road and the overall traffic of potential clients.  Ensure that your signage is strategically placed and you have ample parking.

How to Analyse your Industry

Apart from your environment it is also important to analyse the Industry. This basically involves checking out the general trends in the restaurant industry. Here is how to go about it.

• Keep yourself updated with all economic and business news in the food industry – It is always important to subscribe to any newsletters and magazines covering the restaurant industry. Such publications ensure that you get to know about new products, laws, disease outbreaks and more.
• Research on the regional and national population – It is also important to look at the demographics of the whole region apart from that of your local trade area. This gives you a clearer picture of what the population is composed of and their tastes.
• Ensure that you follow the current market trends – Keep track of any emerging trend that directly affects your business by identifying consumer preferences and behaviour regionally and globally.
• TIP! If particular topics or specific industry terms are of significant interest to you, make sure to use Google Alerts services, which will easily send you an email as soon as its tools has identified new content available online on the subject.

 

In case your establishment is located in close proximity to tourist attractions, you need to focus more on international industry trends as majority of your customers will be tourists from different parts of the world.

Written by Daniel Grossmann