One of the tricks of a sharp restaurateur is the ability to spot new locations with hidden potential. Some owners look for years for that second or third location, while others find them fast, remodel quickly, and suddenly open.
Finding that perfect spot is not easy. It often takes hunting and research and a bit of snooping. Frequently, you may think you are overstepping with your inquiries but that may be what it takes to get the perfect location before someone else does.
It takes the ability to ask questions, keep your eyes open, and realize there is something strange going on when a cooler is on the sidewalk.
Here are ten tips on how to get a new space at a reasonable price before it hits the real estate market.
1). Pick out a location that you like and think may be profitable and begin to eat there, frequently, daily.
2). Talk to other restaurant owner’s about how business is. Discount what they say by 50% to get a true number.
3). Go to neighboring bars and ask the bartenders about the food and clientele of the space you are interested in. They are the best source for restaurant real estate.
4). Look at the rental market in the neighborhood. If there are a lot of homes for sale, houses or apartments for rent find out why. Also, evaluate the rental market. Are the apartments so expensive that tenants will not have any disposable income for food?
5). Get to know the waitresses. They have the inside scoop on vendors, payroll, taxes and customer count. If a waitress is making great tip income the price of the restaurant is going to be high.
6). After you do your research and compile your data approach the owner. If he is a working owner he is tired and may want to get out of the business. If he is an armchair owner, he is frustrated with the problems and the lack of cash flow. (Arm chair owners seldom have cash flow.)
7). If the owner doesn’t want to sell after the first meeting, meet again and again if you believe the space has potential.
8). Drive around the neighborhood and look for other spaces that may be available. Do not pursue a space if there are a lot of other vacancies in the area.
9). Spend the last week of every month observing your favorite spaces. If they are on the way out, they will be out of menu items. There specials will be limited, and the back bar of the restaurant will be stark and empty. They will be out of wine list selections. The deserts will be tired. The staff will be minimal.
10). Finally, the last day of the month is the day of the deal. Many owners wait until the last day to move their coolers, furniture and inventory on the street. That’s a day that really signifies if a location is available or not.