Many successful shopping center food courts have inadequate seating. While it can be overlooked somewhat in downtown food courts because of strong take-out business, it cannot be ignored in suburban malls. Seating to food courts is like parking to shopping centers. When you don't have it, you lose customers and sales. The total number of seats, however, is not the most important factor. Instead, the number of available tables with seating is the critical element. An occupied table, even if three seats are unoccupied, is not available seating. People prefer to sit alone or with friends and rarely share a table with strangers.
How do you determine your food court's table and seating situation? Follow these steps, designed to identify the needs in your food court, rather than relying on industry averages. Each food court has its own personality and, therefore, it must be addressed individually.
1. Count the number of tables and seats in your food court. Classify them by types of tables (i.e., moveable or fixed "twos", "fours", etc.) This is important because often the seating has changed somewhat since the food court was originally designed. You may find the numbers have changed since the food court was built.
Much has been said and written about food courts from the shopping center developer and individual food tenant point of view. However, little has been written about collective concerns and the pros and cons of food courts. As a consultant to shopping center developers, retailers, and restaurants, I am uniquely qualified to respond to this topic. Additionally, I set up the original Kentucky Fried Chicken development department in the latter 60s. Finally, I have recently written a book entitled, Restaurant and Fast Food Site Selection which will be published by John Wiley & Sons by the end of the year. The book reflects my over 33 years addressing food location opportunities and problems. From both the developer/owner and food operator's perspective, food courts have not been a panacea.
It is important to understand that food courts were established, not to help the fast food industry, but rather to address the shopping center industry's desire to add fast food facilities to shopping centers. Developers and owners did not want to provide the space to individual operators to which they were accustom. Common seating was the answer. Furthermore, the objective was to capture more rent, and hopefully, overage percentage rentals. In some cases, they succeeded, while in others, they failed.
There is an old axiom in the food business that says that strong sales cure all. However, there are times when that is not entirely true. In the last several years, declining customer mall traffic and frugal shoppers have put this axiom to the test. Surprisingly, few have been tested more than the franchisee of a major franchise food company. Nationally known franchise units, with instant recognition, appear to be excellent for food courts. What you may not know is that flat or declining sales affect them more than the other non-franchise units, even if they have high sales levels. Many of our franchise clients are frustrated with food courts, while our mall clients are upset with franchise operator's menu changes. What is the cause of this deteriorating relationship?
The landlord, at the onset, is usually delighted to have a national or well-known regional franchise food operator in his or her food court. The name recognition, image, potentially high sales, limited menu, operating consistency, product quality, cleanliness, value, good service, trained employees and generally well-rounded operations normally make the franchise operator a good tenant. It is important to note that the franchise operator is answerable to both food court management and the franchise company. The franchise operator must meet operating standards set and monitored by the franchisor.
Excerpted from Melaniphy's book - - The Restaurant Location Guidebook, a comprehensive guide to picking restaurant and quick service food locations (2007).
Over the years of reviewing and selecting restaurant locations, it has became obvious that the industry needed a set of guidelines regarding location selection. Formulated over the last 25 years, these guidelines are included in my book entitled, The Restaurant Location Guidebook; To select good locations, one needs to be aware of the following:
Over the years of reviewing and selecting restaurant locations, it has became obvious that the industry needed a generalized set of guidelines regarding location selection. Thus, in 1992, my book entitled, Restaurant & Fast Food Site Selection, was published. Furthermore, my latest book entitled,The Restaurant Location Guidebook, published in 2007 amplifies the need for these guidelines. Interestingly, there is a feeling in many parts of the country that dining is a very personal thing, and therefore taste can overcome a secondary location. Perhaps that sometimes occurs, however, in my experience, it is very rare. In fact, the exact opposite is usually true, namely taste cannot overcome a poor location, and thus failure is usually eminent.
During the Recession, thousands of marginal and successful restaurants have closed because of fewer people dining out, the loss of significant luncheon business, other financial problems, lack of anticipated sales, rising gasoline prices vs. dining out expenditures, fewer frequent customers, smaller check averages, and consumers trading down, along with locational factors like poor access, limited parking, and numerous other reasons. This is the food business where every customer is a food critique.
Admittedly, in the last several years even restaurants and quick service food unit in good locations have fallen victim to the worst recession in my lifetime. However, even with economic these problems, picking the right locations given all of the problems can help to keep the grim reaper away. Up until 2009, I thought that the 1974-1975 Recession was the worst I had experienced. This one is at least twice as bad.
In my book, The Restaurant Location Guidebook and in my previous book, Restaurant and Fast Food Site Selection, I address Site Selection and Procedures that will maximize sales and minimize the recession hazard, providing some insulation from the recession blues.
Melaniphy says that infill locations can often cannibalize sales from your existing restaurant(s). Obviously, that is not what you wish to accomplish. This problem can be easily avoided.
Know your existing restaurant’s customer characteristics, trade area, and where the existing restaurant’s most frequent diners reside. Many restaurant chains utilize “customer intercept surveys” to better understand their customers. They plot the customer data so they can visually portray where their customers reside and how often they come to the existing unit(s), (See Chapter 3 in The Restaurant Location Guidebook).
The process of determining sales transfer or cannibalization is simple, but for whatever reason, most food people do not do it. They should! That way you can know what your impact may be and either avoid it or plan for it. Moreover, if you face a franchise situation, you have data and visuals to fight the battle, first with the franchisor, and perhaps, in the courts or in arbitration. The process is as follows:
1. Develop the needed customer data
2. Make it visual – plot the data on a map that clearly shows where you customers are coming from and the likely impact of another unit
3. Estimate the likely impact
Over time, I've reviewed and evaluated both good and bad food courts and food operations for the shopping center industry and independent and chain food operators. In addition, I have been an expert advisor and witness in legal actions regarding food courts. Lastly, I have written a book entitled Restaurant and Fast Food Site Selection which includes a chapter on malls and food courts. Here are a few of my current opinions on the subject.
1. Food courts need pedestrian traffic; they often cannot create sufficient action by themselves. Food courts should be placed where people will logically congregate or certainly pass.
2. Food courts are generative, but in an unusual way. They usually generate the majority of their traffic during normal dining periods, when the body's computer signals its time for chow. Thus, food courts should not be looked at as a generator for a wing of a shopping center or mall. While they will generate traffic at their peak periods, they usually will not generate much traffic during their non-peak periods. Remember, a considerable amount of food court sales come from "impulse" decision making.
Originally published in Pizza Today, August 1988
Getting necessary marketing information and data entails the the use of four primary elements. The first is knowing what to get, the second knowing where to get it, the third getting it, and the fourth knowing what to do with it once you've got it.
Collecting and evaluating data needs to be done within the context of the previous Site Selection articles found in Pizza Today. These include: Understanding the Importance of Location, Recognizing the Principles of Location Selection, Knowing Your Customer Profile, Understanding Your Trading Area, Recognizing Different Types of Locations, and Understanding the Need for Accurate Demographic Data.
What to Get
Most food operators recognize the factors that affect the sales potential of a location including population, income, employment, competition, accessibility, and other factors. Where to get the information can be perplexing. The Reference Table included presents a list of the items, usually available, that can help in evaluating market opportunities. Often, it is not necessary to obtain and study all of the items listed. Instead, they represent sources for different types of data, which can be helpful in deciding what is beneficial to you in your own situation. Let's look at the key elements.
In pursuit of the magic site selection formula, one must recognize that there are numerous types of locations. Moreover, each type usually has a different set of trade area characteristics, requiring modification of site selection criteria. This is one of the reason why many computer models don't work, and why many real estate site location people make mistakes. Additionally, today it seems that pizza is being sold or delivered from every fast food operation, store and restaurant. Why are some so much more successful than others? Let's examine the differing types of locations that I have identified over the last three decades.
In a sense, downtown areas are "where it all started". Downtown was the original market place, the major activity area, the initial concentration of people and the major employment center. Many changes have occurred in downtowns throughout North America; some for the better; but sometimes for the worse. Downtown locations must be approached, evaluated and selected with caution. If done correctly, some big winners can be found.