The goal of any restaurant is success and growth. For many restaurants, if success is achieved with one venue, their ambitions shift to expansion.
Expanding your restaurant from one venue to multiple has the potential to maximise revenue and secure financial stability for your business.
However, if you don’t know the most effective and secure methods for restaurant expansion, you could be setting yourself up for failure. Without proper planning or experience, your revenue could be negatively impacted and the success of the original restaurant you’ve worked so hard to grow could be damaged.
In this blog, we’ll highlight key considerations when looking to expand your restaurant. This includes finding the best locations to expand to, and discovering other ways to successfully grow.
Factors to consider when expanding your restaurant include:
There are many different ways to go about restaurant expansion, and choosing the right option is crucial for long-term success. Here are seven of the best ways to sustainably grow your business:
Expanding your business to a new location is a potentially risky, high-cost move. However, it can have a significant pay off if it succeeds.
It can boost not just your immediate profits, but your brand's financial stability as a whole. That said, this strategy is not without challenges. You’ll need to consider the costs of your move, and attracting diners to your new location.
Opening up a new venue can involve significant rental and refurbishment costs, as well as the price of purchasing new equipment and hiring additional staff. And once your venue is established, you’ll need to put budget behind rolling out marketing campaigns to spread the word.
Offering an on-brand experience in your new venue can be a major challenge, but as long as you keep aligned with your restaurant mission statement and brand, then you can retain the distinct qualities that make your business special. You might also want your new location to be different in some way from your existing venue, to motivate diners to go there even if it’s not the closest location to them. For example, this could be by accommodating outdoor seating at one venue, to make it a go-to spot for the spring and summer months.
It’s important to foster customer loyalty to your brand before you consider growing to an additional location. With a strong existing customer base, a new location poses less of a risk because your regular diners will likely be willing to extend their support.
You’ll also have an existing target market that trusts your reputation and quality of food, and an email database of diners who have previously made a booking that you can effectively market your new opening to.
With a new venue comes new challenges to your businesses communication and daily operations, too. Luckily, ResDiary’s features and integrations are built for restaurant groups. We can seamlessly support multi-site businesses, offering restaurant owners central oversight of multiple locations through booking management solutions.
Plus, with ResDiary’s Cross-Sell widget, you can take advantage of having multiple venues with increased availability to ensure your diners get the table booking time they prefer. If a customer’s preferred time at one venue isn’t available, you can instantly offer them the same time at your other venue. This means you don’t lose customers when one venue is booked.
For more information, check out our guide to chain restaurants.
By franchising your restaurant, you can expand your food business to an impressive scale. This strategy involves allowing another operator to open a venue using your restaurant’s branding.
Restaurant franchising can help you achieve rapid growth. You’ll get cash inflow through franchising fees, while taking on limited financial risk and delegating the management of all restaurant operations to the operator of the venue.
Franchising generally requires you to have a distinct restaurant concept to help attract diners and stand out against competitors. Make sure to do a high level of research to ensure that franchising is a viable business model for your restaurant.
While the risk to your business is lower than opening a new venue under your complete control, unsuccessful franchising can certainly harm your brand if any of the venue operators don’t uphold your brand values and service standards effectively. Bad reviews at one venue can lead to distrust of all within the franchise.
ResDiary’s analytics suite is the perfect tool to help make the decision of whether to franchise your business or not. Our analytics suite allows you to make the most of your booking data, and identify customer preferences, as well as using information you gain from integrations like EPOS systems to draw on sales data and forecast whether your business is ready for an expansion like this.
A hospitality group is a company that owns and handles multiple businesses within the industry. These businesses can include bars, restaurants and hotels. By creating a hospitality group, you have a versatile selection of different brands and businesses that can reach a larger customer base than an individual venue can.
Unlike a chain restaurant or franchise, a hospitality group features venues that retain their individual brands and operational models. This means that a restaurant can be incorporated into your hospitality group without having to sacrifice its unique appeal or established audience.
At the same time, each member of a hospitality group gains all the benefits of unified management. This can extend to shared resources like finances, in-house marketing teams, and a centralised supply chain.
Even with a diverse range of establishments, you will need a table management system that can handle multiple venues and is easy to use for all staff. ResDiary’s table management system and integrations are tailor-made to handle multiple venues at once with streamlined software.
ResDiary can also be a unified source for all brands to manage their marketing campaigns and restaurant data.
Pop-ups and food trucks are a fantastic way for restaurants to test the water of general interest before fully committing to a full restaurant expansion. With food trucks or pop-up events, you can clearly measure interest in your brand and general popularity. You can also test out fresh recipes and menu items with limited impact on your venue's reputation if things go wrong.
A pop-up or food truck is also a perfect tool to gauge if a particular location is suitable for your business. If your food truck visits a general location and you find you have plenty of diners and customer interest, that may be the ideal location to create a new venue.
For more information on making the right decisions for testing expansion for your business, check out our complete guide to restaurant demographics.
With ResDiary’s promotions feature, you can create widgets for your pop-up events to showcase on your website or social media. You can also use ResDiary's marketing tools and integrations to directly promote them to your customers.
Even if your business may not be ready to grow into new venues, you can still gain the benefits of restaurant expansion by increasing your restaurant’s general capacity.
This could be done through venue renovations to expand your indoor space, making better use of your outdoor space or repurposing sections of your business to host events:
Download our Complete Guide to Mastering Events to learn more.
Another easy way to expand your restaurant without heavy financial commitment is to offer a larger product range. This can include offering gift cards, take-home products, and branded merchandise.
A wider product range enables your customers to enjoy more of your brand's special appeal. If you have a signature sauce, you can offer it as a take-home product, so they’ll be thinking about your restaurant every time they use it and share it with others.
Everyone loves a little bit of merch too, so if you know your customers enjoy your unique aesthetic, you can offer branded apparel and tote bags for them to enjoy. It can’t hurt to have diners wearing your brand around and promoting your restaurant either!
Offering gift cards is also a great way for your most passionate diners to share their love of your venue with friends and family. With ResDiary restaurant gift cards, you can start offering flexible payment options across your business, and measure their effectiveness simply and effectively.
Collaborating with other businesses can help you introduce your products to a different audience that may not have considered your brand before.
Does your restaurant have signature items like a craft beer or specialised dessert? Why not showcase these by teaming up with a bar down the street to sell your craft beer in their venue, or supplying your dessert to be sold in a local cafe?
Collaborations like these present an opportunity to build positive industry relationships with businesses in your region. For example, in exchange for them showcasing your products, you can offer unique products from their businesses in your venue too. The reaction to this product range can also help you gauge interest in items you may not have considered offering previously.
By expanding through collaboration, you can offset some of the inherent risks associated with expanding and safely testing the waters for specific markets and locations.
While expanding your restaurant to additional locations can be complex, there are best practices to help you get on the path to financial stability.
Here’s a step-by-step guide to expanding your restaurant to additional locations:
Before you even consider establishing a new venue, you must be regularly and consistently delivering outstanding customer experiences at your first location. By perfecting your initial site, you will already know how to optimise your operations across all your venues.
With a popular and profitable initial location, you can offset the risk of establishing a new venue, as you’ll have a steady income stream you can rely on. You’ll also have a large database of customers you can promote your new location to.
It is critical that you have firmly established and defined your brand before you consider expanding to a new location.
A well-defined brand involves a clear mission statement with clear goals and a highly distinctive concept. Without having these features, you may struggle in a new location. This could mean a failure to achieve a return on your investment.
ResDiary can help you build your restaurant branding through features like our built-in email marketing solution, allowing you to easily brand your customer messaging. You can even brand widgets on your website.
This allows you to control your customers’ perception of your brand from the booking process all the way through to post-dining follow-ups.
Before committing to opening a new location, you should gather as much data on your business as possible. This will give you a clear overview of your business’ strengths, weaknesses and opportunities. This allows you to find the areas you’ll need to improve in your new location.
By using ResDiary’s analytics suite, you can better understand your booking data, as well as information from integrations like EPOS systems. This allows you to make the best decisions for the future of your business.
It’s a good idea to create or revisit your business plan when you are considering restaurant expansion. With a business plan, you can take full stock of your business’ standing.
A clear plan can be critical to securing funding for your business by showing confidence and professionalism to your potential backers.
A business plan can also include many details that can help you get your new venue off the ground quickly. This includes sample menus and descriptions of ideal dining experiences.
If aspects of your business have heavily changed since the founding of your initial venue, updating the plan can ensure your vision for the new locations is clear.
A new location will need considerable funding to build and manage. In the initial stages, the location may not immediately turn a profit.
This means additional funds may be necessary to keep your operations running. If you do not have the necessary finances yourself, you will need to rely on external funding.
This could involve a simple loan, or bringing in business partners. Either way, you can have significantly more capital to work with.
However, by using an external funding source, you may become beholden to external parties. You may also sacrifice some control of your brand and day-to-day operations. Be sure to carefully weigh up all these factors before making this critical decision.
Before expanding into a new location, you need to have software capable of streamlining your operations while managing multiple venues at once. With the right software, you will have a familiar system that is easy for staff to use.
Tools like ResDiary offer versatile integrations and can be scaled into new locations as necessary. ResDiary is also a commission-free software, allowing you to keep more of the profits on your bookings as you accept them.
ResDiary’s table management system gets your staff away from ineffective pen-and-paper systems and lets diners make reservations 24/7. With our Cross-Sell feature, you can boost all your venue bookings and ensure diners always get their preferred booking times by showcasing availability across your venues.
With EPOS integrations like PowerEPOS from Triniteq or AccessEPoS, you’ll have reliable point of sale software while also collecting vital data. And with ResDiary’s built-in email marketing features, you can increase customer loyalty and bookings by automating personalised messaging. Messages can be sent once a booking has been made, and you can follow up with satisfied patrons for reviews and future bookings.
Each of ResDiary’s features creates a two-way data flow between each integration. This boosts each function and enables a total overview of your business. You can get complete oversight on everything from customer preferences to your most popular booking times and menu items.
With more data comes more information you can turn into actionable points to improve your business across all your venues.
Finally, before you commit to a new restaurant site, consider what your intentions are with this new location and plan accordingly. You may want to build in a similar area to your initial branch to appeal to a similar demographic. Or you may want to try to appeal to a new audience with a slightly different style of venue and location.
You must also ensure your new venue is totally compliant with the required hiring and health regulations, and that everything is built to code. For more information, check out our guides to legal requirements for opening a restaurant in the UK, and required licences for opening a venue in Australia.
You can trust ResDiary’s booking management system and versatile range of tools to help expand your restaurant, no matter the method. Whether it’s gathering the data you need to know, or streamlining your daily operations, we have the perfect tools for an effective restaurant expansion plan.
Ensure you have a complete overview of your existing venue before you even consider creating a new one with ResDiary’s analytics suite. Our system can be tailored for restaurant groups and multiple venues, so your staff can use a familiar system across your brand. You can even ensure customers never miss their favourite time slots with our Cross-Sell widget.
Book a demo with ResDiary and expand your business with efficient and productive tools.