Restaurant Business Success Series | Blog #5
Lessons from Nearly 20 Years of Opening and Operating Restaurants in Greater Vancouver
Evaluating the right restaurant means understanding the location, customers, and business potential before you buy.Introduction
(How to Evaluate a Restaurant Business)
After nearly 20 years of opening and operating restaurants in Greater Vancouver, one question has always interested me.
Why do some people buy an ordinary restaurant and turn it into a successful business, while others purchase a restaurant with impressive sales and still fail?
Over the years, I discovered that many buyers evaluate the wrong things first.
They search for the perfect restaurant business.
I search for the right location for my customers.
That difference changes everything.
One principle has guided almost every important decision I have made:
There is no perfect restaurant business.
There is only the right location for your customers.
What Most Buyers Look At First
When people begin searching for a restaurant to buy, they usually compare businesses based on information such as:
- Monthly rent
- Kitchen equipment
- Interior condition
- Sales history
- Customer traffic
- Google reviews
- Asking price
- Existing menu
- Business reputation
These are all important pieces of information.
In fact, every serious buyer should review them carefully.
However, there is one problem.
Most of these numbers describe the seller’s business, not your future business.
That is a very important difference.
The Seller’s Past Is Not Necessarily Your Future
A restaurant may have performed very well under the previous owner.
Perhaps the menu perfectly matched the neighborhood.
Perhaps the owner built loyal customers over many years.
Perhaps their management style fit that market exceptionally well.
Those achievements deserve respect.
But they do not guarantee that you will achieve the same results.
Likewise, a restaurant with only average sales is not necessarily a poor opportunity.
If the location perfectly matches your own concept and target customers, it may become far more successful under your ownership.
This is why I never evaluate a restaurant based only on its past performance.
I evaluate whether it has the potential to succeed in my future business.
Your Customers Should Evaluate the Restaurant—Not You
One of the biggest lessons I have learned is that buyers often evaluate a restaurant from their own perspective.
Instead, they should evaluate it from their customers’ perspective.
Ask yourself:
- Who are my target customers?
- Where do they spend their time?
- Why would they choose this location?
- Does my menu match their lifestyle and expectations?
- Will they return regularly?
These questions are far more valuable than simply asking whether last year’s sales were good.
A restaurant is successful because customers choose it—not because financial statements look attractive.
The Right Location Is Where Your Customers Already Are
In my second article, I explained that the best location is not always the busiest street or the most famous shopping center.
The best location is where your customers already are.
Every restaurant serves different customers.
Families.
Office workers.
Students.
Tourists.
Local residents.
Each group has different habits, different schedules, different expectations, and different dining preferences.
That means the best location for one restaurant may be completely wrong for another.
The question is never:
“Is this a good location?”
The better question is:
“Is this the right location for my customers?”
That single question has helped me make better business decisions throughout my restaurant career.
Restaurant Data Is Only Reference Material
When evaluating a restaurant business, financial statements, equipment lists, lease agreements, customer reviews, and previous sales are all valuable.
But I treat them as reference material, not as the final answer.
These documents tell me what happened under someone else’s ownership.
They do not tell me what will happen under mine.
The future of the restaurant depends on completely different factors:
- My menu
- My service
- My pricing
- My management
- Most importantly, whether my target customers are already in that location.
Numbers provide information.
Customers provide the answer.
One Lesson I Have Never Forgotten
Looking back over nearly 20 years in the restaurant industry, I have learned that the restaurants with the highest sales were not always the best businesses to buy.
Likewise, some businesses that attracted very little attention eventually became excellent opportunities because they were located exactly where my target customers were.
That experience completely changed the way I evaluate restaurant businesses.
Today, before I study financial statements, I first study the customers.
Before I evaluate the restaurant, I evaluate the location.
Because the restaurant itself can be changed.
The menu can be changed.
The interior can be renovated.
Even the brand can be rebuilt.
But if your target customers are not there, none of those improvements will create a successful restaurant.
Practical Evaluation Checklist: What Really Matters Before You Buy
When evaluating a restaurant business, many buyers become overwhelmed by financial statements, equipment lists, and renovation estimates.
These documents are important.
But they should never become your primary decision-making tool.
Instead, I recommend evaluating every restaurant in the following order.
Step 1. Identify Your Target Customers
Before looking at the restaurant itself, clearly define your customers.
Ask yourself:
- Who will be my primary customers?
- What do they expect from my restaurant?
- How often are they likely to visit?
- What price range fits their lifestyle?
Without clear answers, no restaurant can be properly evaluated.
Step 2. Evaluate the Location Through Your Customers’ Eyes
Forget the current owner’s business for a moment.
Instead, stand outside the restaurant and observe.
Ask yourself:
- Are my target customers already here?
- Do they naturally pass this location?
- Would they stop and come inside?
- Will they return regularly?
This is the most important research you can do.
Remember,
A busy location is not always the right location.
The right location is where your customers already are.
Step 3. Use Business Information as Reference Material
Now begin reviewing the business itself.
Consider:
- Lease terms
- Rent
- Equipment condition
- Sales history
- Customer reviews
- Financial statements
- Asking price
These are valuable sources of information.
But they are not the final answer.
They describe the previous owner’s business—not necessarily yours.
Step 4. Ask One Final Question
Before making an offer, ask yourself one simple question.
“If I opened my restaurant here with my menu and my concept, would my target customers choose this location?”
If your answer is uncertain,
keep looking.
Buying a restaurant is a long-term investment.
Patience usually costs far less than buying the wrong business.
Common Mistakes Restaurant Buyers Make
Looking back over nearly two decades, I have noticed several common mistakes.
Many buyers:
- Fall in love with beautiful interiors.
- Focus too much on kitchen equipment.
- Assume strong past sales guarantee future success.
- Believe a famous location automatically means good business.
- Make emotional decisions because they fear losing the opportunity.
I have learned that successful buyers behave differently.
They stay objective.
They ask difficult questions.
Most importantly, they evaluate the location through the eyes of their future customers, not through the success of the previous owner.
My Advice From Nearly 20 Years in the Restaurant Business
If I could give only one piece of advice to someone buying their first restaurant, it would be this:
Never buy a restaurant because someone else succeeded there.
Buy it because your customers will succeed there.
The previous owner’s menu is not your menu.
The previous owner’s reputation is not your reputation.
The previous owner’s business history is not your future.
Your success begins the day your customers decide that your restaurant belongs in their neighborhood.
That decision has very little to do with the previous owner’s sales.
It has everything to do with understanding your customers before you invest.
Restaurant Buyer’s Golden Rule
Don’t look for the perfect restaurant business.
Look for the perfect location for your customers.
Because after nearly 20 years of opening and operating restaurants in Greater Vancouver, I have learned one simple truth:
There is no perfect restaurant business.
There is only the right location for your customers.
FAQ
Should I buy a restaurant with high sales?
Not necessarily.
High sales may reflect the previous owner’s menu, management, and customer relationships.
The more important question is whether your own restaurant concept fits the location and the people who live or work there.
Is location more important than the restaurant itself?
In many cases, yes.
A restaurant can be renovated.
Equipment can be replaced.
Menus can change.
But if your target customers are not in that location, success becomes much more difficult.
What should I evaluate first?
Start with your customers.
Then evaluate the location.
Only after that should you analyze the restaurant itself.
This order helps you make decisions based on your future business rather than someone else’s past.
About the Author
The author has spent nearly 20 years opening and operating independent restaurants in Greater Vancouver, Canada. Rather than sharing theory, this blog series is based on real-world experience—successful openings, costly mistakes, operational improvements, and practical systems that help small restaurants achieve long-term success. My goal is to help future restaurant owners avoid costly mistakes and make better decisions before investing their time, money, and energy.
Beyond Canada
Although the examples in this article come from my experience opening and operating restaurants in Greater Vancouver, the principles themselves are not limited to Canada.
- Understanding your customers.
- Choosing the right location.
- Making decisions based on research instead of emotion.
- Preparing for unexpected costs.
- These principles apply to restaurant businesses almost anywhere in the world.
- Markets may differ.
- Cultures may differ.
- Customers may differ.
- But successful restaurants are still built on the same fundamentals.
Internal Links
You can naturally connect this article to the following posts:
My Restaurant Startup Principle
Successful restaurants are not built by spending more money.
They are built by making better decisions.
Every restaurant I’ve opened has reinforced one lesson:
Customers come first.
Location comes second.