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Opening a quick-service restaurant in a challenging economy can feel like venturing into a risky commercial real estate development; there are heavy capital expenditures, significant operating costs, and months without revenue. So, more than ever before, operators are seeking ways to open their doors earlier through strategic permitting, new design strategies, and smarter negotiations with property and municipal authorities. With the development of this trend, experienced operators know one thing to be true: Better speed to market has very little to do with an operator’s actions in the final days and hours before open, but rather what is done months and years in advance.
The following are some insights and tips for implementing an informed, effective speed-to-market strategy.
‘Permit’ Yourself Some Time
Securing appropriate permits for your operational needs can either add or subtract several months to your development process. Your building type can play a role in your speed-to-market success. Typically, there are two main building types: existing buildings where operators rent space, and standalone buildings.
Tenant Improvement (TI) projects in existing retail centers or commercial properties are generally easier to permit. In several cases, the retail use has already been established with the property management, which is helpful because that effort usually includes traffic, parking, and accessibility studies (all endeavors that would otherwise be done at the operator’s expense). Operators also typically save costs here by bypassing the need for hydrology work or landscaping. Essentially, the major drivers for design have already been established.
Standalone, or “ground up,” projects provide the inherent value of flexible drive-thru capabilities and a division of space from competitors, though they require more time for planning and construction. Two of the most important issues to plan around are traffic and zoning. Operators who are swift to facilitate a traffic study and establish a manageable impact on surrounding road systems have a better chance of expediting the permitting process. Zoning can also be a problematic area if operators don’t facilitate adequate research early in the process. When looking at potential properties, check the type of use for which the property has been zoned. Trying to procure permits that contradict the zone’s intended uses will assuredly cause delays in the process.
Know Your Building
The first tip in smoothly and swiftly planning your building space doesn’t stem from the brick and mortar that frames the floor plans—it’s the relationship with your property management. In TI projects, create an early and open dialogue with your landlord to determine weight restrictions for equipment and parameters for heating, ventilation, and air conditioning. Some landlords may require an occupancy separation, and those needs can change based on your estimated occupancy. For example, restaurants with an occupancy of 50 guests can have entirely different requirements than a general retail space with the same occupancy.
Knowing the building codes set by your local and state jurisdictions is also important when evaluating your store space (even in the scouting stage) as compliance issues—if unaddressed—can be a major obstacle later. For example, many state building codes require two exits for a dining room that seats more than 50 guests. In the quick-service sector, this can present a challenge, as operators often seek to front-load dining rooms and the unexpected addition of an exit can require new floor plans. Knowing the prerequisite specifications set by your potential property managers and your governing bodies can be valuable in assessing if properties can meet your needs. That information can also serve as a guide when creating store designs and seeking permits to ideally expedite your store openings.
Notify the Authorities
Working cohesively and quickly with local and regional permitting bodies is a two-part recipe that calls for great networking and thorough homework.
First, build your network and know the people. In most municipalities, city managers and economic development directors are the champions for new business and revenue. They can sometimes help to move things along and are a valuable relationship to foster. Equally important is the city planner. Showing an understanding of the planner’s needs in your proposals will bode well for seeking approvals.
Second, understand the organization. A fundamental fact that some operators overlook is that permitting bodies often operate completely independently of each other. Securing a building permit may not mean that you’ll surely qualify for a mechanical or fire permit. Similarly, multiunit operators quickly learn that health departments can enforce entirely different codes from county to county. Knowing the right questions to ask in advance can save time, money, and stress.
The positive note is that most permitting bodies are available to help with the process. Start the process by going to a city’s website and you’ll find most permitting departments have checklists for restaurant operators to give a sense of issues they find most important. Some health departments can even review your menu and tell you what facility specs they’ll be interested in seeing on your property.
Find the Right Partner
With operational issues consuming the lion’s share of their time, most quick-service restaurant owners will enlist the support of an architectural partner to help with the planning and permitting process. If you choose this route, it’s advisable to pick a local firm or an organization that has people on the ground in the market you’re entering. A local presence means local expertise and relationships with city planners and permitting bodies. Some municipalities even maintain preferred practitioner lists of these groups to expedite their requests, based on their consistent credibility. Also, make sure your architects are fluent with the issues. Storm management, HVAC systems, ADA compliance, and jurisdictional codes—these are all terms and topics that should be second nature to them.
As experienced operators can attest, gathering the right people, resources, and information—with ample lead time—is the best formula for maintaining a healthy restaurant-opening timeline.