 Hello, friends. Welcome back to Module 2, Lesson Number 3. This is a really juicy lesson that I really, really want you to pay attention to because we're going to be talking about how do you find the perfect restaurant location, super action-packed. Let's dive right in. You're going to learn the four elements to watch out for when choosing the perfect location, some of the common pitfalls, and the two types of restaurants that you should be looking into. Now, previously we talked about the golden trifecta. If you are not aware of it, definitely go back to the beginning of the lessons and to find this specific lesson. We talked about it because this is your highest chance of success when you can have all three things and components overlap. We talked about the concept earlier. Today we're going to be talking about location and our next lesson we're going to be talking about customers. When all three of them are aligned, that's when the golden trifecta would emerge. When that emerges, that's your best chances of success. Mind you, this is what's going to get your lineups out the doors when all three of these components overlap. Without further ado, let's dive right in. Why location type is crucial to your success? It all comes back down to pricing because if pricing was not an issue, we always want to choose a location that has the highest walk-by traffic to ensure that you have more potential to convert these walk-by traffic into potential customers. We talked about that budget is a real factor for your decision, which is the reason why it's important to break down the two different types of restaurants that we can encounter. The two types are high traffic foot traffic locations versus destination locations. High traffic location type are situated at large foot traffic spots. We can think about downtown, the malls, financial district. These are the places where there's a lot of walk-by traffic, a lot of foot traffic around the area. The pros of that is that you have more potential for revenue. Why is that the case? It is because you have more people walking by. If your signages are good, if you're convenient enough, then people will come over and purchase from you. Whereas the con for that is that it's usually much more expensive in rent because, once again, you have more potential way to make more money. Therefore, that estate is even more expensive. Versus a destination location which is situated at a low foot traffic area. We're talking about more closer to residential area, industrial areas, side streets where you particularly need to probably drive over. Not as much public transit would be able to get you there. Those are called the destination location. Oftentimes, when you do go to a destination location, you have the intent of going. You have an intent of, hey, you know what? Let's go check out this place. Let's drive over and try them out. Versus a high foot traffic location, it's like you're walking in the malls, you're hungry, and you're like, hmm, what should I eat? Oh, you see this restaurant? It looks good, great menu. Boom, you go and try it out. That's the difference between the two. The pro of having a destination location oftentimes is much cheaper rent because it is in the middle of nowhere. The con of that is less walk by traffic, less potential to make revenue, and it's more of an uphill battle to get your customers to come through the doors. However, having said that, having a destination location doesn't mean you're not going to have a busy restaurant. It means that it is harder to get people to notice you and it is harder to get that walk by traffic. That's what I mean by destination location. Now, after choosing your type, after understanding, okay, you know what, it is a balancing act. It's not just walk by traffic. It is not just destination location. There could be a hybrid of both of them. But at the end of the day, it really comes down to the budget, right? If it fits your budget and you're comfortable with it and if you've done all your projections and your finances to figure out what you can afford for rent, then you can go ahead and choose a hybrid of the two. You can lean more towards higher foot traffic or you can lean more towards the destination. But knowing the different types would allow you to understand the pros and cons which helps you to understand where the shortfalls might be. Now, after figuring out that type that you're looking for or understanding that, it is time to choose your community. This is by far one of the most important things that we're talking about. No one talks about this, right? But it is super important to choose a community that you love and that your customers, your ideal customers are hanging out super, super important. We talked about this a little bit and so you need to be able to spend time within the community to see if it is aligned with the customers that you would like to serve. You don't want to be building a community or building a restaurant in a place that is really far from where your ideal customers hang out. That is no good because even if they love your restaurants they're not going to come all the time. They're not going to be repeat customers which is why you need to be able to choose a location that is close to them. You need to spend time at your competitor's location to see who is it that they're serving and how is it that they're serving it. Is it in line with what the concept you have in mind? Is there a sense of belonging? Is there a lot of repeat customers to verify and to validate your assumptions to see if your concept could work in that particular location? It could mean a difference between you closing down or not. Super, super crucial is the community, guys. But you don't need the whole city to come visit you to have a successful restaurant. You also don't need to be running crazy ads on TV or have a huge marketing budget because all you need are loyal customers that come back again and again. Ultimately, it really comes back down to the customers that you're serving and that's the reason why choosing the community that you're in and identifying the concept that fits their needs are super crucial for success and it all ties back down to the golden trifecta. It takes skills and patience to develop your loyal customers but, and it's something that we will cover is how do you turn a regular customer into a loyal fan? We cover this in the 1K loyal fan journey later on down our lesson. So make sure that you guys keep watching. Okay, other elements to consider. The four elements that we talked about that we're going to be covering, we're going into it right now. Visibility, do people even know you exist? Types of foot traffic, car traffic patterns, time at which there's an influx of traffic. Signage is to let people know that you exist whether there are nearby office buildings and schools. This is something that is crucial and it is really, really important because let's just tell you a quick story. We have been running our ice cream shop in this neighborhood called Kitsilano and it's been like five years that we've been there and then after we had a business meeting, one of our partners put there like, hey, you know what Wilson, what do you want to try out this Vietnamese place? We're like, sure, let's go try it out. It's a new place, we tried it out, we love the food and then we asked them, we're like, hey, you know how long have you been open for? They've been open for seven years, guys. Seven years, yet we still had no clue that they were just a block down from where we are because they were tucked in the little store, they didn't have much visibility and people can just kind of walk by and just completely forget about them. That's the reason why visibility is super, super crucial for your success. If you're a little bit tucked in, it is okay then work on your signages, work on the sandwich boards, figure out how you can maximize the visibility for you. Now, mind you, if your visibility is hurting for your location, then subsequently the pricing for that specific location would be lower as well, which is the reason why knowing these factors and these elements are also crucial for you to be able to sign the lease. Second thing is accessibility. Is it easy to get to? Is there parking available? If, for example, if you're doing a fine dining experience and there's no parking, then what kind of fine dining experience is that? Not really that fine dining, right? Most likely fine dining you can expect to have a, what's that called? Ooh, the people that drive your car, valet, there you go. You would expect to have a valet to take your car and so on and so forth, but if there's no parking spots or not enough parking spots for a hundred shop location, then that probably is not that good of a choice. Same thing, is it transit friendly? Our ice cream shop is located right in front of a bus stop. The reason why I chose that location is because now the university kids can come by and once they get off the bus and boom, we're right there. What mode of transportation fits your target audience? As I was saying, fine dining experience, that's the type of experience that I want to be able to provide my customers who are a little bit more established, who have vehicles, who drives, who has families versus if it's transit friendly, mostly high school kids, university kids. So understanding the accessibility for your specific concept is also equally as important. Next up is safety. Is the area safe? Will the area make your potential customers feel uncomfortable? What's the crime rate in that area? These are all very, very valid items that you would bring up to your landlords when renting their place or even considering, for example, if you want to create this family fun concept restaurant. And yet, there are oftentimes break and enter within the area. Probably not the best area and location to have your concept because how safe would you feel to bring your kids to that location? You would always be thinking, oh my goodness, all these bombs kind of loadering around. It's really affecting the way that I'm eating. The peace of mind is not there and thus I would not want to stay there for longer than I want. And that would really deter your customers from coming again and again. Lastly, it's their surroundings, the businesses and the competitors. This is something that is oftentimes overlooked as well. Are your competitors doing well? This is a really good sign to see whether that your concept in this area is validated. Or if they're all struggling and if they're all closing down, it's probably not the best idea to have your shop there. Is there room for your business? Vice versa, if it is super busy, well, can you still put your foot in there and still be able to have a piece of the pie? Understanding that is crucial for your success. So the four types of elements to consider when talking about your location, visibility, accessibility, safety and your surroundings. Common pitfall and confirmation bias. I talked about confirmation bias previously in my lessons. Let's dive in a little bit further. You walk into a unit, you love it. Everything about it is perfect. It's beautiful. People are nice in the area. High traffic and you're like, wow, this is a perfect location. Rent is cheap. Everything is taking off Wilson's checklist. Visibility and everything, wow. Amazing. You fall in love with this location. You're like, hey Wilson, where are you going tomorrow? Well, you fail to see that there's a huge rentals that's needed to be done within the location. Probably hundreds and thousands of dollars, which is the reason why rent might be cheaper. You fail to see that there's no foot traffic at night, yet the concept that you're trying to do is going to be fine dining. You fail to see that there's no parking at all and that doesn't work with your fine dining experience because if I am going to bring my date to dazzle them, press them, yet I can't drive and my parking spot is like 10 minutes away, probably not the best experience for my guests. You see other three ice cream shops around you and you're like, wow, yet I still want to open up this experience here. Probably not the best case, guys. Confirmation bias happens when you basically ignore all the other variables that are telling you no Wilson, don't do it, and you just ignore it because you fell in love with the place. Never, never fall in love with the location. Rule of thumb, number one. Never fall in love with the location. It's about making the best judgment and not mixing in your emotions and just because of the fact that I'm telling you about the confirmation bias would allow you to catch yourself to see, hey, you know what? Am I falling into this phenomenon? You need to understand that. Not negotiating is a huge, huge thing for new first-time restaurantiers. Super, super big, big mistake, right? Because we feel like that, oh, you know what? We shouldn't negotiate or like, how do I negotiate? Do we just throw back a number and you just don't know where to start? But knowing the fact that landlords are expecting you to negotiate. Know that for a fact because me, I have rented from someone before and I've also on the other side as a landlord speaking I also lease my units out to my tenants, right? So knowing both sides of the equation allows me to understand that as a landlord what am I expecting? And as a tenant what am I expecting? And I can tell you that for a fact me as a landlord, I'm expecting people to negotiate with me and oftentimes that doesn't happen as much as you think it would. People are afraid of negotiating. Because they're ill-informed, they just don't know what they don't know. But because of the fact that you've taken this course I can almost guarantee you that you're going to be able to at least save one month's free rents by taking this course, okay? It is because you've done your homework and within the link below download that worksheet and start doing your homework, okay? We're going to cover that later on in the lesson. But start downloading that sheet because we're going to cover a few things that you should be aware of when doing your homework. When you know the square footage when you know your surrounding units how much they're charging, when you know the foot traffic around the area when you know how much the buildout cost would be, then you can take all these different statistics and these numbers back to your landlord and tell them, hey you know what? If I were to rebuild this whole place to make sure that it's in compliance with the city, I need to spend $200,000 to build a new washroom, grease shop, hooded fans and everything. Hey, why can't you give me two or three months worth of free rent? And your landlord most likely will know that this is happening and they, oh, you know what? You busted me. You know what? I'll give you two months free rent because in their minds, I better pay you and give you the two months free rent right now so that we can start building and start paying rent. Then for me to leave the unit out there for another two months squatting flies. Once you've taken this course, like I said, you're equipped to ask the right questions which will get you free rents. I've done this multiple times myself with my mentees and I can almost guarantee you that you taking these numbers out and talking to your landlord will guarantee that it's lowered rent and free months rent. Okay guys, super, super important for you to do your homework. They can either split the build out cost with you, lower the rent or not even increasing your rent regardless of the fact when you know your statistics, your visibility, your accessibility, the surroundings, your competition, all these things and on top of that, what is the surrounding areas like you can bring all these statistics back to your landlord and they will understand. They can reason with you. Usually people that are owning these land, they know exactly where their shortfalls are and if you can be objective when you bring out these conversations and tell them, hey, you know what, I know about all this. This is great. You know what, a lot of people walk by this during lunchtime but at night there's no one. When you bring that up they know and tense they will work with you in helping you save some cost. Location hunting. Where to look guys. Drive around different areas looking for these signs. Tell you the truth for our first very location. We drove three months to locate a location for our screen shop and it took us three months of driving around and that's the location we found. The first location we found was the one that we actually signed the lease with. Three months of driving around. Take your time with it and have fun throughout the whole process. I enjoy driving around looking at the areas because once again that allows me to understand the community a little bit better and allows me to understand, hey you know what, is this area great? How is it like in the lunchtime? How is it like at the dinner time? And that allows me to judge whether this location is good for my demographic or not. The second location to look, second place to look for a location is Talk to a Broker. Talking to a broker is often a really, really good choice but something that I prefer driving around but talking to a broker, a good broker is also very good because they have, a lot of times they have a lot of listings and on top of that they have these pocket listings. What are pocket listings? It means that it's not even up in the market yet. It's like probably for a friend and they know that they want to be able to rent it out and they're like, hey you know what, I know a friend that wants to lease something out in a great location and everything. Do you want to hook up? That's usually the relations that you're going to get and opportunities that you get dealing with a broker. Listing sites Craigslist is also another good avenue for you to look for a great location. Nonetheless I personally really enjoy just driving around different areas to look for locations. Now it is your time to go hunting guys. Don't be impulsive because at the end of the day you're going to spend years in this location and you can take your time with it. You're going to spend 5 to 10 years in this location. What is another month? What is another 2 months for you to get this started? Spend the time in locating your location. The process might take months but that is okay. Let's go guys. Start going hunting. It is your turn. Find 5 different potential locations. Identify them as high traffic or destination. Identify the 4 different elements in the link below. Download it and start working on it. After this lesson in the next module we're going to talk about how do you negotiate leases, free rent with your landlord. Start doing your homework now and when you have finalized and shortlist your location we're going to go over the negotiation process. What you have learned today are the 4 elements to watch out for when choosing the perfect location. In the next lesson we're going to be talking about the pitfalls in creating your customer avatar for your restaurant. This is a very, very crucial lesson so make sure that you guys go there and check it out. I'll see you guys in the next lesson.