Restaurant expansion can be a risky, tricky business.
In many instances, restaurant companies dig deep into analytics, investing extensive time, energy, and money to select the best areas for development. Along with the science, however, resides the art—gut instincts and real-world insights that can round out the picture.
Consider what Hooters of America CEO Terry Marks says about how his casual restaurant brand, which has more than 370 domestic locations across more than 40 states, approaches expansion: “We look to regions that are well positioned for long-term growth in population and Disposable Personal Income (DPI).
“We are more likely to be interested in opening restaurants in states with policies that are supportive of business,” Marks says, a nod that the political and social climates, as well as the experiences of current entrepreneurs, are as important as the numbers.
With that in mind and based on data from agencies including the U.S. Census Bureau, the U.S. Department of Labor’s Bureau of Labor Statistics (BLS), the National Restaurant Association (NRA), and the Small Business & Entrepreneurship Council (SBEC), FSR magazine highlights the 10 states that present the greatest opportunities for full-service restaurant expansion.
Projected Population Gain by 2020: 18.7% Number of Full-Service Restaurants: 4,236
Full-Service Restaurants per 100,000 Residents: 84.2
Colorado Restaurant Association: www.coloradorestaurant.com
Projected 2012 Growth in Restaurant Sales: 3.5%
Business Tax Index: 28.010
Median Household Income: $60,442
Buoyed by stable industries including tourism, aerospace, telecommunications, and energy, Colorado has avoided wild swings in its economy and has shown consistent annual growth in key metrics. Colorado is expected to add up to 1 million residents in the next decade, and the NRA predicts DPI to rise by 2.7 percent in 2012.
More than 300 days of annual sunshine doesn’t hurt either, says Colorado Restaurant Association CEO Pete Meersman.
“We have a healthy population that spends plenty of time outdoors [and] our restaurants are busy year-round,” Meersman says.
Mark Berzins, who runs 19 full-service units in the Denver metro area under the Little Pub company umbrella, says restaurateurs in Colorado, particularly of the independent variety, are bullish.
“People here are not pulling in their horns,” Berzins says. “Restaurant spaces are getting gobbled up, new restaurants are opening, and food spending has held up in spite of the economy.”
Sitting in between the coasts, Berzins adds, gives Colorado a culinary sophistication, and invites the influences and experiences from other spots throughout the country to take root and attract diners in the Centennial State.
“When it comes to food, there’s a sense of adventure here,” Berzins says.