It is always important to conduct as much due diligence as possible prior to investing large amounts of money into a restaurant. Below is a quick Restaurant Industry SWOT Analysis. To all entrepreneurs, consider creating one of these for yourself to identify your personal area of improvements, the company, and the industry to determine which areas you should be focusing on.
Strengths
- 2.5% annual growth for the past 5 years – expected to grow into 2019
- Low Barriers to entry
Weaknesses
- Intense Competition
- Tight Profit Margins (avg. $15 – $25 is 3.6%)
- High Restaurant Failure Rate
- Government food regulator
Opportunities
- Diversify Products
- New Regions
- Franchise Opportunities
- Growing Market
Threats
- Mature Market (small market share)
- New Entrants
- Increasing labor expenses
- Increasing COGS
Its your turn!
References:
IBISWorld
Statista