The Importance of Restaurant Location


After deciding to open a restaurant, you must select the perfect restaurant location where your new business can thrive.  A restaurant’s location is critical to its success.  Even if you are aware that a suitable restaurant location with plenty of space is required, there are numerous other factors to consider.


There is no doubt that choosing the right restaurant location is important. Not only does the location affect the quality of the food, but it can also impact the restaurant’s overall success.


Your restaurant’s location will be different for different target audiences. If you’re trying to attract a young and trendy crowd, for example, you might choose a location in a trendy part of town. If you’re targeting a more traditional clientele, you might want to go for a more tranquil setting.


Here are a few tips to help you choose the best location for your restaurant. The following is a list of selection factors that can be used to determine the quality of a specific site.


How To Choose A Restaurant Location


One of the first things to consider when looking for a restaurant location is what uses the building is permitted to use under the Town and Country Planning Act.  This divides land into various use classes.


The Importance of Restaurant Location


The Order of Use Classes And Permitted Changes of Use


The Order of Use Classes outlines relating to restaurant and hospitality businesses are:

  • A3 Use
  • A4 Use
  • A5 Use
  • C1 Use


So, What Exactly Is A3 Use Class?


A3 is the classification for restaurants and cafés that serve hot food on the premises.


Premises in Use Class A3 may sell “food or drink for consumption on the premises or hot food for consumption off the premises,” which includes most restaurants and snack bars.


The A4 Use Class


The A4 Use Class applies to drinking establishments such as public houses (pubs), wine bars, and others. Nightclubs are not included in the user class.


What Role Does A5 Play In Commercials?


A5 Use Class is for hot food takeaways where food is sold for off-premises consumption. To name a few, there are fish and chip shops, pizza shops, (fried) chicken shops, Chinese, and Indian takeaways, kebab shops, and so on.


C1 Hotels


Hotels, boarding houses, and guest houses that do not provide a high level of care (excludes hostels).

A Comparison of Restaurant Location and Rent


It goes without saying that a restaurant should try to be in a prime location with good exposure and nearby traffic flows.


These types of locations, however, come at a cost, which is the high rent that you will have to pay. A less visible location, such as down a side lane or on the second floor of a building, can be a good alternative.


You will then be able to save a lot of money on rent and negotiate better lease terms with the building owner.


However, you must compensate for a poor location by having an excellent marketing strategy as well as food and service that encourages repeat business.


How To Choose A Restaurant Location


Size Of The Operation


You should have a good idea of the size of the restaurant operation you want to open. One of the most basic requirements for a location is that it be large enough to accommodate a restaurant of your desired size and concept.


Health and safety laws will dictate how many people can occupy the building, so you should learn about these requirements before beginning your search.  You may discover that the property you thought was ideal is actually too small for the customer base you need to attract.




Restaurants are typically located in areas that are easily accessible and close to business districts and residential areas. Being approachable will ensure that you can attract the number of people required to sustain your business.


Stand outside the building where you intend to open your restaurant. Count vehicle and pedestrian traffic flow and compare them to other locations under consideration.


The exception to this rule is if your location is “out of the way,” such as a beach vineyard.


The unusual location of a restaurant can sometimes be a selling point.


Keep in mind that, in the right circumstances, people prefer features such as a beach view or mountain scenery over convenience and accessibility.


Purchase vs. Leasing


You must decide whether leasing or purchasing restaurant space is the best option for your business.


Both alternatives have benefits and drawbacks.


Rather than investing in property, most restaurant owners begin by leasing and saving their capital for startup costs and business growth.


Conduct preliminary negotiations with building owners to determine how flexible they will be on lease terms.


Reaching a lease agreement can be a time-consuming process, so it helps if you can work with building owners with whom you can effectively communicate.


They should allow for some wiggle room and debate.


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Demographics And Market Research In The Area


Consider the type of neighbourhood in which your proposed restaurant space is located.


Then consider the type of restaurant that would be appropriate for the surrounding residents.


Spend some time researching the demographics of the area to learn about the age, ethnic background, and socioeconomic status of the locals.


Restaurant Location


Local Economic Development And Site Selection


People will only eat out in restaurants if they have jobs and extra money to spend. Before opening your restaurant, consider the local economic conditions.


How Is Business Sentiment In The Neighbourhood?


The local economy will also have an impact on your concept selection. Fast food is still popular in a bad economy, but higher-priced menu options are unlikely to do well in a town where businesses have closed.


Competition And Other Businesses


One of the criteria that you must consider before deciding on a restaurant location is the other businesses in the area.


A high level of competition is not necessarily a bad thing because it indicates that the market is healthy and can support a large number of restaurants.


However, you will obviously want to minimise the competition near your restaurant as much as possible.


At the very least, choose a restaurant concept that is unique in the area, so you will have few direct competitors. Second, find out if there are any other businesses nearby that could complement a restaurant.


For example, if your restaurant is located across the street from a movie theatre, you may see an increase in business from moviegoers who come in to eat before watching a movie.




You should have a good idea of how your proposed restaurant’s customers will arrive. A fantastic restaurant, ideally, should have its own car park. Depending on your plan, nearby public parking may suffice.


However, keep in mind that if they can’t find a parking spot, many people will simply drive to another restaurant. It is worth noting that closeness to transport services may be more important in some cities than parking.


Exterior And Surroundings


Examine the side streets and other structures in the vicinity of the location you’re considering.  They can sometimes have an impact on a prospective diner’s perception of your establishment.


Because you will have little control over your neighbours, you should select a restaurant location with neat, tidy, and well-maintained surroundings.


Costs Of Renovation


The costs of converting an available space into a restaurant will vary depending on the location.  The previous use of the building will have a significant impact on the scale of renovations. If the previous owner also ran a restaurant on the property, remodelling should be minimal.


If you are leasing a space for your restaurant, you should keep remodelling costs to a minimum.


If you are able to negotiate with the building owner and have them contribute to these costs, you may want to consider spending more.


The amount you should spend will also depend on how long your lease is.


Ask for cost estimates from a building inspector or a few contractors who have worked with owners of restaurants to modify premises.




When planning to build a restaurant, keep in mind that location is one of the most crucial elements that will affect your success.


During the choosing process, keep the aforementioned requirements in mind.


For your restaurant to run well, the building you choose should not only be in a visible location but also be practical and useful to achieve the success you desire.


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