Merchant Blog

Restaurant Location Strategy: How to Choose a Restaurant Location

Whether you’re opening a new restaurant or expanding, here are key considerations for your restaurant location strategy.

9 min read
restaurant location strategy

There are a few obvious questions to consider when it comes to your restaurant location strategy: How much are you willing to spend on rent? How much space do you need? What's the best neighborhood for your target customer base?

But beyond these basic queries, there are additional questions that are equally important—and not so readily apparent. Here are a few tips to help you understand why restaurant location is important and optimize your search for the best spot to open up shop.

Know your restaurant’s niche

Fast-casual restaurants, cloud kitchens, and food trucks all have vastly different needs when it comes to restaurant location strategy. To figure out yours, it’s important to know what type of establishment your business is and what type of experience you want your customers to have. Here are some questions to ask yourself before opening up a restaurant:

  • Will customers primarily dine in or take food to go? If your goal is to create an in-house dining experience for your customers, you’ll need the space to do so. Some experts recommend locations where you can allocate 60% of your space to diners and the other 40% to your operations. However, if you don’t plan to serve customers in your space, you can be more flexible.

  • What type of atmosphere do you want to create? There are many different types of restaurant vibes—from friendly neighborhood joints to upscale experiences. Before you can find the best space to make your restaurant dream a reality, you need a strong vision for the experience you want to create for your customers. Consider what you’ll need to support that atmosphere—from the location’s neighborhood, to the ceiling heights, access to natural lighting, availability of outdoor seating, and more.

  • Where and how will the food be made? Your kitchen has specific needs depending on the cuisine you serve. For example, are you baking wedding cakes or preparing sushi? To envision the right restaurant kitchen floor plan, start thinking about exactly what you’ll need from a kitchen and food prep spaces to create your signature dishes.

Choose a neighborhood for your restaurant

A neighborhood is what connects you to your customers, both in person and through your delivery radius. Every neighborhood has a distinct personality—and you want to make sure that your restaurant character fits in. Spend time in each area you're considering and take note of what you see.

Here are a few questions to consider when developing a restaurant location strategy:

  • Is it busy or quiet during the day? What about in the evening?

  • Are there a lot of nearby offices or workers, suggesting a thriving lunch crowd looking for quick options?

  • Do the neighboring restaurants offer dine-in seats, or do they do most of their business through delivery?

  • Are there other businesses in the area that provide a lot of foot traffic, or do people generally drive to and from the area—making convenient parking options a necessity?

  • What are other restaurants like in the area? Are they similar to yours, or would your restaurant provide a unique alternative to what they offer?

  • Is there a predominant age group or demographic in the neighborhood? For example, keep an eye out for families with kids, retirees, working professionals, and other groups that you’ll want to keep in mind as you develop your menu and hours.

  • Is seasonality a factor for that neighborhood? Do people tend to visit more during a certain time of year, depending on weather or local community activities?

The answers to these questions will help provide key data points about the neighborhood's competitive landscape, foot traffic, and the local market.

Think about the logistical details

Details like parking options and street visibility are critical factors in connecting customers to your cuisine. Providing an easy place to park can be what brings diners to your door, and great street visibility can attract new customers who wouldn’t have discovered you otherwise. 

Take the time to dive into details like these when finding the best location for your restaurant:

  • Is this space accessible? If you plan to host diners on site, you want to make sure that your space is inviting and accessible to everyone. As you look at a space and imagine a potential layout, you should be thinking about whether or not the space will allow you to comply with certain regulations, such as those put forward by the Americans with Disabilities Act (ADA). It’s an added bonus if you can find a place with solid transportation and parking options for diners who drive to you.

  • Will the location give me good visibility? Think about how many times you’ve stumbled upon a restaurant and fallen in love—now think about where those restaurants were located. An inviting storefront on a busy street can be all you need to reel in hungry customers and turn them into regulars. Conversely, a location where customers need to know about your restaurant in order to find it might make you lose business—or be a boon if your restaurant’s brand thrives on being a bit under the radar (and you plan to use other means to boost visibility, like a strong social media strategy). Whenever you see a prospective location, ask yourself about its visibility.

  • Are people in the neighborhood hungry for your food? When looking at neighborhoods, you need to assess not only whether your establishment will fit in, but also whether or not locals are hungry for the food you’re making. Focus on demand, talk to locals, and do customer research to determine how locals might respond to your menu and offerings. It’s hard to perfectly predict customer behavior, but you should aim to move into a space where the surrounding population is eager for your arrival so that you can always count on local business.

How to find restaurant space

Once you’ve gotten a sense of the neighborhood, zoom in on the actual restaurant real estate you’re considering. Think about your block and your neighbors: will you be adjacent to any loud noises or unpleasant smells? Will you be lost amidst a torrent of similar restaurants? Are you near public transportation or easy parking? Does the spot you’re considering get a lot of foot traffic—and if so, do those people align with your target customer? The answers to these questions can help determine whether or not a space is right for you.

Unless you’re looking at newly built properties, it’s also important to think about the past life of a building or storefront. What type of establishment used to occupy the space you’re looking at? For example:

  • Is there an existing kitchen? If you’re moving into a space that used to be a restaurant, you may assume that it will have the appliance infrastructure necessary to support yours—but that isn’t necessarily the case. The ovens needed for a bakery differ tremendously from the fryers needed for a burger joint. You don’t need to move into a space that has 100% of what you need, but you do need to move into a space that’s capable of supporting the type of equipment you plan to use.

  • What will you be replacing? If you’re opening a late-night spot in what was formerly a quiet cafe, your introduction to the neighborhood might cause a stir—which could be a good thing, but something to be mindful of nonetheless. If you plan to serve alcohol, investigate whether the former occupants also had a liquor license.

Ultimately, you want to ask yourself: do I have an opportunity to fill a gap in this neighborhood? If the answer is yes, then full steam ahead.

More help with your restaurant location strategy

Because restaurant location is so important, it can also be the most expensive part of opening a restaurant. Check out how to pitch to investors about your concept.

Whatever location you choose for your restaurant, a partner like DoorDash can help you connect to customers in your area, market your restaurant, manage delivery orders, and more. Learn how to optimize your location for pickup and delivery, and sign up for DoorDash today.


Andrew McCarthy

Andrew McCarthy

Content Lead

logo subscribe to blog

Subscribe for insights to help you run a great business, delivered weekly to your inbox.