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Analysing Marketing Environment To Open A New Restaurant

A restaurant ( listen) is a business establishment which prepares and serves food and drink to
customers in return for money, either paid before the meal, after the meal, or with a running
tab. Meals are generally served and eaten on premises, but many restaurants also offer takeout and food delivery services. Restaurants vary greatly in appearance and offerings,
including a wide variety of the main chef's cuisines and service models.

S. R. Luthra Institute of Management

Analysing Marketing Environment To Open A New Restaurant


Surat is Gujarat's second largest city with a population of 2.1 million at the 2001 census and
4.6 million at the 2011 census. It is the eighth largest city and ninth largest metropolitan area
of India. Surat is the 34th largest city by area in a study conducted by The City Mayors
Foundation, an international think tank on urban affairs. The city registered an annualized
GDP growth rate of 11.5 per cent over the seven fiscal years between 2001 and 2008.Surat
ranks 4th in a global study of fastest developing cities conducted by The City Mayors
Foundation, an international think tank on urban affairs. Surat Bags Best City Award in 2013
constituted by Annual Survey of India's City-Systems ( ASICS).

The people of Gujarat are very passionate about their food and besides enjoying their own
food, they are also fond of spreading out delicacies for their guests. The restaurants in Surat
very well manifest this passion of the people living there. Surat is an important industrial and
business city of India and is therefore perennially full of tourists and visitors. Surat
restaurants are perfect places for them to try out the local delicacies as well as the other
regional specialties of India.

There are a number of vegetarian restaurants at Surat but with a colossal increase in the
cosmopolitan crowd in the city a number of non- vegetarian multi cuisine restaurants now dot
the city. There are some special restaurants in Surat that serve the most authentic Gujarati
thalis and other North and South Indian dishes. But the restaurants of Surat are not restricted
to their regional specialties and there are Restaurants that serve Continental, Chinese and
other Western dishes.
S. R. Luthra Institute of Management

Analysing Marketing Environment To Open A New Restaurant


For many would be restaurateurs, a franchise presents the perfect opportunity to open their
own restaurant. There are a lot of benefits of restaurant franchises, such as instant name
recognition and built in marketing. However, buying a restaurant franchise is not always as
easy (or as cheap) as one might think. Here is a step-by-step guide to finding and buying a
restaurant franchise.
1. Understand What Defines a Restaurant as a Franchise:
Not all restaurant chains are franchises. For example, Starbucks is one of the most recognized
chains in the world. But it is not a franchise. It is corporate owned and operated. Applebees is
a restaurant franchise. Owners, called franchisees, purchase the rights to open and operate an
Applebees. As part of the deal, the franchisee pays royalties to the head office, called a
Franchisor. In return, the franchisor (in this case IHOP is the owner of Applebees) takes care
of marketing, menu design and problem solving for all its franchisees.
2. Consider Which Type of Restaurant Franchise is Best for Your Local Market:
Restaurant franchises include fast food (think McDonalds, Taco Bell and KFC) and fast
casual (think Applebees, Panera Bread, Chilis Grill & Bar) as well as smaller chains, like
Cold Stone Creamery. Before pursuing any restaurant franchise, first find out if it will fill a
market niche. This means doing a study of the local competition as well as a profile of the
local economy. For example, if the area already has several Mexican restaurants, investing in
a franchise of On The Border Mexican Grill & Cantina may not be the best idea. It could also
be deemed too expensive compared to the average household income. On the other hand, a
market analysis may show that it will be welcomed with open arms by the locals.
3. Examine Your Budget and Restaurant Qualifications:
Restaurant franchises are expensive ventures. Cost more than anything else will limit your
choices when it comes to buying a restaurant franchise. Experience is another important
factor in opening a restaurant franchise. Parent companies (franchisors) dont hand out the
keys to a franchise unit to just anyone. Consider the following:
Applebees requires a minimum of $1.5 million in net worth and $500,000 in liquid
Brinker International, the parent company of On the Border Mexican Grill &
Cantina, Chilis, and Romanos Macaroni Grill requires a net worth $500,000 and a
minimum of five years experience in casual dining.
Panera Bread requires a net worth of $7.5 million and liquid assets of $3 million.
Plus experience in real estate and managing multi-unit restaurants.
Many restaurant chains list franchise requirements right on their website. is an online company that also lists current franchise opportunities
for sale.

S. R. Luthra Institute of Management

Analysing Marketing Environment To Open A New Restaurant

4. Create a Restaurant Business Plan:
A restaurant business plan, which you need for bank or investor financing, will help fill in
any gaps in your restaurant franchise concept. It will force you to examine things like the
population base of an area, profiles of the local economy and choices of location. As part of
writing a restaurant business plan for a franchise you will need to investigate the franchises
history and current financial status. This is especially important if you are investing in a new
restaurant franchise.
5. Go over a Restaurant Franchise Contract With a Lawyer:
Once you get through the initial process of being approved for a restaurant franchise and
secure your financing, you will sign a lengthy contract with the franchisor. Review the
contract with a fine tooth comb before signing on the dotted line. Most importantly, know
what can happen if the franchise fails. Are you locked into paying the franchisor a set amount
of money each month or year, regardless of success? Who owns the equipment? Will you get
any of your investment money back? Dont assume that because it is a chain it will be an
instant success. It still takes hard work and patience.

S. R. Luthra Institute of Management

Analysing Marketing Environment To Open A New Restaurant


What You Need to Know About Opening Small Restaurant
Before you fantasize in running your own restaurant, you need to know first that it requires
hard work. If you would not be willing to work that hard, then just forget about your dream.
The first step you need to take is choosing the restaurants corporate structure.

Choosing the Right Corporate Structure: You can choose from 5 structures to
incorporate in your business such as C corporation, LLC, sole proprietorship and
partnership. The best and most ideal structure is the limited liability corporation or
LLC because this will provide you protection from personal liabilities. So, if someone
sued you, your personal properties such as cars, house etc. will not be affected.
Anyone who wishes to start a small business should consider having this kind of

Hire Quality Workers: There is always a high demand in quality food today. So, it
will depend on the skills of the workers and employees you have. To make sure that
there will always be repeat customers in your restaurant and you can establish a good
name in the industry, you should prioritize their overall satisfaction.

Another important are that you need to study is the minimum and maximum pay rate
of every employee based on their position.

Startup Costs and Other Expenses: If you already have a restaurant and you are
planning to remodel it, you will jut spend less. But if you are starting from scratch, the
estimated sum you need to spend is from $100,000-$300,000 to buy the needed
materials and equipment such as cooling and heating systems, shelving, counters and
cutting stations, bar stools, chairs, tables, refrigerators, freezers and other ventilation
an cooking equipment. To get these pieces of equipment at their lowest possible
prices, you need to shop around local stores and online stores for the best deals.

Startup Budget Management: You need to ascertain that you have enough money to
buy all the things you need during the first few months after your restaurants
operation. You should also be able to reach a positive cash flow. Apart from that, you
also need to create a good credit record because this will help in making your small
restaurant grow into a bigger one.

S. R. Luthra Institute of Management

Analysing Marketing Environment To Open A New Restaurant

Competition in the restaurant industry in general, and specifically within the upscale casual
segment of the restaurant industry, may adversely affect guest traffic at our restaurants.

The restaurant industry is highly competitive with respect to price, value and promotions,
service, location, and food quality. There are a substantial number of restaurant operations
that compete with us for customer traffic, some of which have significantly greater resources
to aggressively market to consumers, which could result in our concepts losing market share.
Consumers are highly focused on value and if other restaurants are able to promote and
deliver a higher degree of value, our guest traffic levels may suffer, impacting revenues. In
addition, with improving product offerings at quick-service restaurants and grocery stores,
coupled with the present state of the economy, consumers may choose to trade down to these
alternatives, which could also negatively affect revenues. Some of the competitors are as
1. Leonardo Ristorante Italiano
2. Jalaram Khichdi Restaurant
3. Mainland China
4. Mr. And Mrs. Somani
5. Caf Piano
6. Chhote Miyan
7. Village
8. Dil Se Re Restaurant
9. Kansar Gujarati Thali
10. Temptationz Live BBQ
11. Sasuma
12. Center Court
13. Wok On Fire
14. Sizzling Salsa
15. Pizza Hut
16. O2 Ristorante
17. Black Pepper
18. The Glorious Restaurant
19. Mexican Rodeo
20. Sky Muncch
21. Go China
22. Balaij Restaurant
23. Garam Masala Restaurant
24. Dominos
25. McDonalds
26. Lakeview
27. Machaan Jungle Restaurant
28. Tasty Restaurant
And many more
S. R. Luthra Institute of Management

Analysing Marketing Environment To Open A New Restaurant

It is found out that in Surat City, people not only prefers good qualities and different dishes
always, but they prefers the time, the moment they spends with their families enjoying
delicious foods and different dishes in great ambience, where they feels pleasurable
experience .
But it is also found out that there are more than 292 restaurants in Surat city, each of them
having different ambience and food taste. Number of restaurants having number of different
dishes containing different taste.
But it is also true that there are lakhs of people lives in Surat city and prefers to go to new
restaurant every weekend. And the people of Surat city are fond of having different foods.

S. R. Luthra Institute of Management

Analysing Marketing Environment To Open A New Restaurant

It is advisable for a company to open a new restaurant. The decision of whether having own
restaurant or to buy a franchise depends on the financial budget of the company.

S. R. Luthra Institute of Management

Analysing Marketing Environment To Open A New Restaurant


S. R. Luthra Institute of Management