New restaurants and new restaurant locations are popping up every day. For this reason, the restaurant industry may be the most competitive. It requires more than good food and marketing to make a new eatery successful.
Our restaurant market research company often recommends encourages new establishments or those opening a new location to conduct a feasibility study.
The insight and data gathered from restaurant feasibility studies will predict how likely the eatery is to be successful based on a number of different factors. Of all the market research studies available for a new business, feasibility studies are the most advantageous.
Before we get into the why and the how, let’s briefly discuss the what.
Before investing too much money and time into a new restaurant or market, a feasibility study will use predictive analytics to inform better business decisions for your team and investors. Learn more about the power of restaurant feasibility studies.
What is a restaurant feasibility study?
A restaurant feasibility study is a hybrid market research approach as it combines both qualitative and quantitative elements. This methodology will assess the concept of your restaurant or the potential new location to predict the potential supply and demand.
Feasibility studies in the restaurant industry can answer questions such as:
- Is there a demand for this type of restaurant?
- Is there a risk of investing in this new restaurant?
- How frequently will community members eat at my restaurant?
- Who will be my main competitors?
- What are my competitors currently doing that the community likes and dislikes?
- Where are there gaps in the market that my restaurant can fill?
Our feasibility studies company utilizes core methodologies to paint a picture to dictate how likely the success of a restaurant will be.
What are the benefits of a feasibility study for a restaurant?
Finding success in the restaurant industry is really tough. Each year, the industry adds about 10,000 units a year, from a combination of 60,000 openings and 50,000 closures. How can you feel confident your restaurant will not be a part of the 50,000 closings?
Before investing too much money and time into a new restaurant and location, a feasibility study relies on predictive analytics to inform better business decisions. In short, data-driven decisions drive better feasibility of a restaurant. This will not only give you peace of mind but is a great study to present to potential investors.
When working with a restaurant feasibility studies company like Drive Research, your team will receive more than charts and data. We work as both research analysts and consultants to assure your new venture is set up for success. We act as an extension of your team to recommend the best approach possible.
What are the components of a restaurant feasibility study?
A feasibility study is typically broken down into three components to offer a mixed-mode approach of both quantitative and qualitative research. The three components recommended by our restaurant feasibility studies company are outlined below.
Component #1: Syndicated Research
The first step of a feasibility study for a restaurant is conducting syndicated research. This helps provide overall market insights and demographic data. At a high level, this component is advantageous for new ventures because it highlights market supply and shifting target populations.
Component #2: Competitive Assessment
It is no secret that the restaurant industry can be tough to break into. Before choosing a site location and opening your doors for business it is important to assess what restaurants will serve as your biggest competitors with a competitive assessment. This component will evaluate competitor pricing, the share of market, customer likes and dislikes, etc.
Component #3: Market Survey
Finally, the third recommended component of a restaurant feasibility study is a market survey. A market survey will help asses the concept and location of your establishment to understand the appeal, barriers, and how often the community will eat there.
What is the process of working with a restaurant feasibility study companies?
If you are looking for a research partner for your restaurant feasibility study, Drive Research can help. It is important to understand that no two feasibility studies are the same.
Like most of our market research studies we do not use a cookie-cutter approach, rather take the time to understand objectives, specifications, and budget in order to recommend the best approach.
Typically our feasibility study projects are broken down as such:
- Proposal. After contacting our team to discuss your project needs, our team will send an in-depth proposal with our recommendations.
- Kickoff Meeting. If your team decides to move forward, our restaurant market research firm will schedule an initial kick-off meeting (via phone or in-person) to introduce your dedicated project team and learn more about your objectives.
- Workplan. Next, Drive Research will create a project workplan to show outline the timeline and responsibilities of each party.
- Fieldwork. This stage expands based on what component(s) of your restaurant feasibility study you have signed on for. Drive Research will draft an interview guide or questionnaire for your approval before we are off and running.
- Post fieldwork. After fieldwork is complete, we run our final audits to assure our survey data is clean and ready to draft into a report.
- Report. Drive Research will create a feasibility market research report with an executive summary, recommendations, breakdown of question by question results, an infographic, and much more.
- Debrief Meeting. Our restaurant market research company will schedule a debrief meeting to walk through the report and any potential barriers to your new establishment.
Now your team is ready to take action on the in-depth and customized insights!
Thinking about opening a new restaurant or expanding into a new market? A restaurant feasibility study can get your establishment the answers it needs.
Contact Drive Research to get started!