Best Cities to Start a Restaurant

There are certainly plenty of factors to think about when it comes to opening a restaurant. Buying restaurant equipment, hiring staff, obtaining permits and marketing are only a handful of “to-dos” that aspiring restaurateurs must keep in mind before opening their doors to the public.

And perhaps the biggest factor of all is location, location, location.

So, what’s the best market to open up a restaurant? We were curious to find out. After ranking the best cities to start a restaurant, we were able to find out where restaurateurs can get the best return on their investment. To narrow down our list to the top 50, we analyzed four key factors across 236 cities including:

• Annual restaurant sales per capita
• Restaurants per capita
• Number of restaurant industry workers per capita
• Median income in each city

Check out our findings below.

The Washington D.C. area dominates the top of the list with both D.C. and Arlington ranking No. 3 and No. 1, respectively. San Francisco, which is home to the most restaurants per capita, also falls within the top 5. Elsewhere on our list, cities with growing restaurant scenes like Austin, Nashville, and Denver show why aspiring restaurant owners might not want to rule out second- and third-tier cities.

While there are many cities that made are list which known for their cuisine, such as San Francisco, Miami, Charleston, and New Orleans, it’s interesting to see smaller cities like Chattanooga, Fort Collins and Raleigh make the cut as well.  

Overall, when it comes to finding an ideal location to start a restaurant, it’s not all about sales. Factors like over-saturation, competition and disposable income are all metrics to keep in mind when researching a market.  

Methodology

To determine the best cities to open a restaurant, we compared 236 cities - including the 150 most populous cities in the U.S. From there, we considered annual restaurant sales per capita, competition and market saturation (restaurants per capita), workforce (the number of restaurant industry workers per capita) as well as median income in each city. Data for restaurant sales, restaurants per capita and workforce was collected from the U.S. Census Bureau. Median income data was collected from the American Community Survey. Each factor was graded on a 100-point scale and then weighted to reach a final ranking.

We determined an overall weighted average based on the following:

Sales: 50 points

(Annual restaurant sales per capita)

Competition: 25 points

(Number of restaurants per capita)

Workforce: 10 points

(Number of restaurant industry workers per capita)

Income: 15 points

(Median income)

What has been bringing buyers to Bid on Equipment through the month of January and what are they looking for when they are here?
 

Below are the top ten search terms that have shown the largest increases from Internet search traffic this month.

Interest in each of these terms has grown 100% - 1500%!

The top ten overall categories for Bid on Equipment in the last month.

The top ten overall Manufacturer Pages for Bid on Equipment in the last month.

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What has been bringing buyers to Bid on Equipment through the month of December and what are they looking for when they are here?
 

Below are the top ten search terms that have shown the largest increases from Internet search traffic this month.

Interest in each of these terms has grown 100% - 1500%!

The top ten overall categories for Bid on Equipment in the last month.

The top ten overall Manufacturer Pages for Bid on Equipment in the last month.

The Top Ten Viewed Items in the Last Month.

What has been bringing buyers to Bid on Equipment through the month of November and what are they looking for when they are here?
 

Below are the top ten search terms that have shown the largest increases from Internet search traffic this month.

Interest in each of these terms has grown 100% - 1500%!

The top ten overall categories for Bid on Equipment in the last month.

The top ten overall Manufacturer Pages for Bid on Equipment in the last month.

The Top Ten Viewed Items in the Last Month.

When it comes to the American dream, owning a small business is arguably at the top of the list.

For those who want the autonomy of owning their own business with the safety and security of a large, well-recognized brand, buying a franchise may be the best solution. Sure, you’ll still need to have the proper amount of finances to cover start-up costs like restaurant equipment, business permits, and initial inventory, but once you’re off the ground, you’ll have the corporate support from the brand as well as a dedicated customer base built in.

We wanted to take a look at franchising opportunities around the country. Specifically, we wanted to know where where aspiring entrepreneurs were interested in opening fast food franchises as well as what type of franchise they wanted to open.

To get a sense of this, we took a look at Google search volume trends that were specifically based on searches for franchising opportunities in every state. After analyzing hundreds of different search phrases, here’s what we found.

Fast Food Nation

Depending on where we live, we all have our allegiances to our favorite regional fast food joints (Dunkin’ Donuts in the northeast and Chick-Fil-A in the south)—but which franchises are the most popular to open in each state?

Per Google search volume data, Chick-Fil-A is the most popular fast food franchise to open nationally, and we found that it is also the most popular in the southeast, which includes Texas, Louisiana, Mississippi, Tennessee, Georgia, Florida, South Carolina, North Carolina, Virginia, Maryland, Ohio and Pennsylvania.

According to Google, the second most popular franchise to open in the country is Dunkin’ Donuts. The franchise is specifically the most popular to open in Illinois, New York, New Jersey, Connecticut, Rhode Island and Delaware. Coming in third place for the most popular food franchises to open nationally is Subway, which is also the most popular food franchise to open in Minnesota and New Mexico.

Little Caesars is also a popular franchise choice around the country with Nevada, Utah, Arizona and Kentucky opening them the most. Jimmy John’s—the quick and fresh sandwich shop—is the franchise of choice for Washington, Wisconsin, Missouri, Indiana and Michigan while Montana, South Dakota and Nebraska have been opening up several Burger Kings in their states.

Surprisingly, the fast food kings, McDonald’s, is only the most popular to open in California and Massachusetts, and fast food giant Taco Bell only reigned supreme in Oregon and North Dakota. “Finger lickin’” KFC was only the most popular in Alaska, Idaho and Maine, and just two states were big franchisers of the southern favorite, Waffle House: Iowa and West Virginia. Interestingly, Waffle House does not offer franchise opportunities, but it looks like Iowans and West Virginians are hoping that changes.

Looking at the fast food franchise map, you can see some interesting patterns. First, Chick-Fil-A is clearly dominating in the southeast portion of the country. Dunkin’ Donuts, an east coast mainstay, has a hold of a lot of the northeast, and Little Caesars has solid footing in the southwest.

Most Popular Fast Food Franchises Ranked by Cost to Start

Even though you’ll get plenty of corporate support and have a healthy customer base that has good brand recognition from the beginning, starting a fast food franchise can be costly—and it’s not guaranteed to work. We wanted to know exactly how much the start-up costs would be for the most popular fast food franchises and what the failure rates were for each.

The lowest start-up costs in our list of the most popular franchises was Subway, with start-ups costing between $89,000 and $328,700. In order to start a franchise with Subway, you must have $80,000 in liquid assets with a net worth of $30,000. Subway may have had the lowest start-up costs, but the failure rate was considerably higher than the rest of the restaurants, coming in at a staggering 23%. The second lowest on our list was Chick-Fil-A, which has start-up costs that range between $265,265 and $2.2 million, which is considerably more than Subway. However, the required liquid assets for Chick-Fil-A were only $5,000 and the failure rate for Chick-Fil-A franchises is only 5%.

At the top of our list was KFC, which has start-up costs between $1.4 million and $2.7 million with required liquid assets of $750,000 and a required net worth of $1.5 million, according to company data. Even after all that money spent, KFC had one of the higher failure rates on our list, coming in at 13%. And just below KFC was Qdoba, which costs anywhere from a whopping $936,000 to $2.2 million to start a franchise. The required liquid assets for the fast-casual Mexican chain are $738,000 with a required net worth of $2 million. On the upside, the failure rate was one of the lowest on our list at only 2%.

So, from our list, which franchises are the riskiest to take on? We gathered that the highest failure rate was Subway at 23% and the lowest failure rates were Whataburger and Taco Bell, with a roughly 0% failure rate, according to the U.S. Small Business Administration.

What has been bringing buyers to Bid on Equipment through the month of September and what are they looking for when they are here?
 

Below are the top ten search terms that have shown the largest increases from Internet search traffic this month.

Interest in each of these terms has grown 100% - 1500%!

The top ten overall categories for Bid on Equipment in the last month.

The top ten overall Manufacturer Pages for Bid on Equipment in the last month.

What has been bringing buyers to Bid on Equipment through the month of August and what are they looking for when they are here?
 

Below are the top ten search terms that have shown the largest increases from Internet search traffic this month.

Interest in each of these terms has grown 100% - 1500%!

The top ten overall categories for Bid on Equipment in the last month.

The top ten overall Manufacturer Pages for Bid on Equipment in the last month.

The Top Ten Viewed Items in the Last Month

What has been bringing buyers to Bid on Equipment through the month of July and what are they looking for when they are here?
 

Below are the top ten search terms that have shown the largest increases from Internet search traffic this month.

Interest in each of these terms has grown 100% - 1500%!

The top ten overall categories for Bid on Equipment in the last month.

The top ten overall Manufacturer Pages for Bid on Equipment in the last month.

The Top Ten Viewed Items in the Last Month

What has been bringing buyers to Bid on Equipment through the month of June and what are they looking for when they are here?
 

Below are the top ten search terms that have shown the largest increases from Internet search traffic this month.

Interest in each of these terms has grown 100% - 1500%!

The top ten overall categories for Bid on Equipment in the last month.

The top ten overall Manufacturer Pages for Bid on Equipment in the last month.

The Top Ten Viewed Items in the Last Month

 How much would you pay to experience a once-in-a-lifetime event? We asked 2,000 Americans what they would realistically pay to witness a particular moment in history. To help narrow the list, we compiled 40 historic experiences from pop culture, music, sports, world history and personal moments. Check out the graphic below to see how much money people are willing to spend on a moment in time. 

In order to breakdown the value of historical events, let’s get the biggest ticket out of the way first. According to the survey, most people would spend on average $100,622 to relive the day their first child was born. This personal moment is interesting, considering that those surveyed already experienced it within their lifetime and would pay that much to simply do it again. Maybe they want to take more photos or soak in the life-changing day once more, but either way, when compared to all other offered experiences in life—whether personal or historical—most people would choose a deeply personal moment to have déjà vu. How sweet!

Aside from sentimental moments, the next biggest items are major historical events: the 1969 moon landing, where most people would pay $39,334 to witness, and the signing of the Declaration of Independence, which fetched around $36,836 on average.

Both events signify major turning points in American history as the starting point of a new frontier: the birth of our country and the dawn of the possibilities beyond our own planet. Considering that the average cost of a wedding in 2018 is $35,329, witnessing events of such magnitude for under $40,000 seems like a bargain!

Back in 1969, you could attend the historic three-day music festival known as Woodstock in upstate New York for $6.50 each day, $18 for all three days with advance purchase. Imagine what the organizers would think if they knew that in 2018, people would pay $11,110 to attend the muddy musical mayhem. Woodstock experience ranks only a few hundred dollars more than the privilege of seeing the Beatles on their 1964 World Tour (averaging $10,564).

So who wants to relive these milestones? Gen-Xers are most likely to pay for music and personal experiences, while Baby Boomers are more likely to go for historic events. Millennials are more interested in pop culture and sporting events, which might explain the surprising price tag of $14,579 to witness Mark Zuckerberg launch Facebook.

Not surprisingly, women would pay $31,456 more than men to relive the moment their first child was born, probably because it was such a whirlwind the first time.

Whether it’s world history or a special time in pop culture or a personal, sentimental moment, people are willing to open their wallets to witness important milestones—either for the first time or once more.