![]() Prepare for worst-case financial scenarios, and factor this into your budget. While setting a budget, determine factors like your projected revenue upon opening, and if you have any wiggle room. This step is especially important for first-time restaurateurs who don’t know how much they should be spending on rent. A clear budget will eliminate all options in your search that won’t work, therefore saving you time. Know your budget.īefore you even begin your search, set your budget. Source: Restaurant Real Estate Advisors, 2020 2. Your idea for a full-service jazz supper club would work best in a downtown area, ideally in an area with a buzzing nightlife.Ĭhipotle Mexican Grill’s Form 10 K shows its occupancy costs are equal to 6.3% of revenue. For example, you might want your quick-service, affordable sandwich shop right near a university. The concept will be a major determining factor for where your establishment should be located. Choosing the right location is a crucial step in opening a new restaurant, and therefore, a restaurant business plan will detail your research into potential locations.Ī business plan will also give detail into the restaurant’s concept. This step helps you become prepared, but it also shows potential investors and partners that you are prepared for this venture. Ensure you have a good business plan.Ī good business plan sets your future restaurant up for success, and this is true for any new startup. If you know exactly what you are looking for and what you can be flexible on prior to beginning your search, it will make the search for an ideal commercial space run smoothly. Being prepared with your budget, desired square footage, and business plan will reduce the amount of time wasted on subpar locations that don’t fit the requirements. Know what exactly you need before you start looking. This does not factor in the amount of time it will take to build out and remodel the space. On average, it takes about six months to find the right spot and sign a lease. By giving yourself ample time, it will allow you to view all the viable options and make a well-thought-out decision without the pressure of feeling rushed. This process can be lengthy, and you should be prepared to not sign the first place you see. When you are ready to start looking for a restaurant space to lease, ensure that you give yourself plenty of time. If leasing the right restaurant space is so important, what is a restaurateur to do if they have no real estate experience? Luckily, there are several steps they can take and resources they can use to make an informed decision about finding their future restaurant space and negotiating a commercial lease. The average amount spent on rent was found to be $6,914 per month. According to a survey of 496 restaurants conducted by RestaurantOwner, restaurants typically spend between $3,000-$8,750 on rent per month. The cost of leasing a restaurant space is very dependent on location. Even if the space seems like the right size and price, it is key to consider the location’s visibility, parking, accessibility, competition nearby, and the area’s demographic. ![]() Your restaurant’s location can be more important than your menu and the dishes you serve. The downside to this prime location? The New York City cost of rent. Junior’s Time Square restaurant is the busiest out of its three locations in the city, and in 2019, it served approximately 914,500 meals. The location of a restaurant can be so excellent that it markets itself, but an off-the-beaten-path location can ensure that you will need to market your business heavily to get customers in the door. If choosing to lease a space for their restaurant, restaurateurs will need to know how to pick the ideal location while also being able to negotiate a lease.Ĭhoosing the right location for a restaurant business can be crucial to its success, especially in the first few months of being open. Restaurateurs must have a firm grasp of business, marketing, customer service, food, and hospitality, but many don’t expect that they might have to dip their toes into real estate.
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