Top 5 Tips For Winning Competition Analysis – Restaurant Business Plan Part 1
As a restaurant owner, you need to have an understanding of your competitions’ business strategy and model, and how they might respond to any competitive behavior in the market place. For example, a change in strategy within your business.
You also need to identify the strengths and weaknesses of your competitors so as you can identify the needs in the customer base that are not being fully met and develop your own business strategy around that.
Getting an understanding of how your competitors are performing financially, will also help you better understand the returns you are likely to get out of your business. This feeds into the financial section of your restaurant business plan as one of the key factors that will form the basis of your realistic sales projections.
Competition analysis will identify the opportunities and threats to your business. Opportunities which you can capitalize on, and threats which you must be aware of and if need be, mitigated.
As with preparing business plans for any market sector, assessing the strength of the competition will give valuable insight into identifying your own unique selling proposition. If you are intending to start up a restaurant and are writing a restaurant business plan, you will inevitably go through this process once you have found a location for your premises. Restaurants have a defined geographic catchment area, so it is important to analyze the competition that operates in your specific geographic area.
In the competition analysis section of your restaurant business plan, potential investors will look for some key themes that need to be addressed:
- how many competitors operate in your customer catchment area?
- what are the competitor strengths and weakness?
- what is your restaurant’s point of difference?
- how will you capitalize on the weaknesses of your competitors?
- how are they likely to respond to your competition?