WHO ARE YOUR COMPETITORS?

The best way to find your competition is with a restaurant competitive analysis: a method of competitive research that looks at your potential competition from different angles, so you can understand the marketplace — and find your place in it. 

To zero in on your competitors, you’ll want to analyze both direct and indirect competitors, along with their menu items, marketing tactics, business practices, pricing, and branding.

COMPETITIVE ANALYSIS FOR NEW RESTAURANTS

If you are looking to open up a new physical location, undertaking these steps can give you the information you need.

STEP 1: LIST COMPETITORS

Compile a list of competitors by neighborhood and identify them as “direct” or “indirect.”

 

  • Direct competitors: These are other restaurants whose offerings are the same as yours and who happen to be going after the same pool of customers. For example, if you sell sushi, your other direct competition would be a neighboring sushi shop.

  • Indirect competitors: Any other restaurants who, while not offering what you offer, might attract the same customer base. Using the same sushi shop as an example, an indirect competitor could be a burger joint down the street that pull in the portion of your customers who like sushi and burgers.

STEP 2: SWOT ANALYSIS

Next assess each of your competitors with a SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats). A SWOT analysis lets you assess what your competition offers customers (strengths),  what’s hindering them (weaknesses), what they can do better (Opportunities), and their vulnerabilities (threats). In doing so, you can get a realistic and complete view of your competition. 

 

For these next steps, do a more specific SWOT analysis in addition to your research. You can also do a SWOT for your own restaurant concept — look for gaps, analyze opportunities, and compare with your competitors.

DOWNLOAD OUR SWOT TEMPLATE

STEP 3: OPERATIONS RESEARCH

Look into their operations with these types of questions: What’s their concept type? What sets them apart? Are they a franchise, group, or independent operation? When were they founded? What are their hours of operation? The number of seats? Do they offer delivery, pick-up, or use an app?

STEP 4: MENU RESEARCH

Investigate their menus, determining their best sellers, differentiators, specials, and pricing strategies. How much variety do they have in regard to dishes or ingredients used? Is there anything unique or stand-out about their offerings? Are their portion sizes big or small? Compare your answers with your own menu.

STEP 5: MARKETING RESEARCH

What kind of marketing do they do? Do they have a strong online presence, detailed website, active social media accounts, or lots of online reviews? Do they offer promos like ongoing deals, special events, coupons, or freebies? Give them a follow on social media and monitor their advertising and marketing strategies — you may learn what to do, or what not to do.

STEP 6: PERFORM SITE VISITS

Become a customer by visiting their establishments to get first-hand experience of their ambiance, service, and overall customer experience. Take note of their operations, staff interactions, wait times, cleanliness, and any other stand-out features. Then dig into their customer reviews to see what they’re doing well, and how customers think they’re missing the mark.

AFTER YOU ANALYZE, STRATEGIZE!

Here are some additional steps and considerations to keep in mind:

  • Menu Planning: Strong menu planning will help give you an edge over competitors. 

  • Staff Training: Your FOH and BOH staff are the face and body of your business. Keep them both happy and learning. 

  • Optimise your tech: Make sure your restaurant is equipped with WIFI, a mobile-friendly website, online ordering partner apps, and mobile payment options.

  • Step up your marketing game: Make sure you are staying competitive with your marketing efforts with social media, Google Business Profile, and a consistent restaurant brand to keep your restaurant operating at its peak.