6 Restaurant Expansion Strategies to Know About

If your restaurant business is thriving, there’s a good chance you’re considering expansion.

After all, why not replicate a successful concept to reach new customers and increase revenue?

While opening a new location is often the first idea that comes to mind, it’s also worth exploring other creative and profitable expansion strategies.

In this article, we’ll explore six strategies to help you expand your restaurant operations sustainably and strategically.

Increasing Existing Capacity

Expanding your restaurant doesn’t always mean opening a new one.

You can boost revenue potential by increasing the capacity of your current space, avoiding the overhead of managing another venue.

Depending on your restaurant’s layout and surroundings, this can be achieved in several ways. 

For instance, if the property next door becomes available, you could take it over. 

Provided the available space and local regulations allow it, you can merge the two spaces to create a larger dining area or add features like a bar or lounge.

If the next-door space must remain separate, consider adding a private dining room for special events or larger groups.

Another option is to build an outdoor patio, like Racalto’s in Hornell, New York, is doing.

Source: The Evening Tribune

The new patio will accommodate up to 24 guests, allowing the restaurant to serve more guests simultaneously.

It will also include heat lamps and a fireplace, enabling guests to enjoy their outdoor dining experience throughout the year.

Another option for increasing capacity is to reconfigure your restaurant’s current seating layout.

By analyzing peak-hour demand and evaluating how guests move through your space, you can design a more efficient arrangement that maximizes capacity without sacrificing comfort. 

However, if your floor plan is already optimized, further changes may be limited from a design perspective.

Interestingly, expansion doesn’t always mean adding more seats. 

In some cases, it may involve reducing the number of dining room tables to create a more exclusive and diverse dining experience.

This was the approach Quince, a San Francisco restaurant boasting three Michelin stars, took during a redesign.

As Lindsay Tusk, who owns Quince with her husband Michael, explains:

Illustration: Tablein / Quote: Michelin Guide

Quince demonstrates a creative way to expand a restaurant’s appeal and revenue potential without physically enlarging the space.

This highlights that expansion strategies can focus on quality as much as quantity.

Similarly, optimizing kitchen and storage areas is another way to increase capacity. 

By improving workflows, your team can serve more guests during peak times without compromising on quality.

When executed thoughtfully, one or more of these ideas can help grow your business while continuing to delight customers in a familiar space.

Opening New Locations

Opening a new location is a popular expansion strategy that allows restaurants to tap into new customer bases and strengthen their brand presence.

If your current restaurant is consistently profitable and demand exceeds capacity, replicating that success in a new area can be a natural next step.

However, expanding to a new location isn’t without challenges. 

So, before taking the leap, ensure you have the necessary funds or access to financing and be prepared for the complexities of managing multiple locations.

If these requirements are met, your next step is to conduct thorough market research.

Here are seven key factors to consider when choosing a new location.

Illustration: Tablein / Data: Gloria Food

Taking a deep dive into these factors is essential to ensure the new location aligns with your target demographic and overall brand concept.

For instance, if a potential venue is close to direct competitors, this might lead to market saturation, making it harder to stand out.

However, if you’re selling pizzas, having neighbors like a taco restaurant or a burger joint could complement your offerings and draw diverse crowds to the area.

Of course, other factors like foot traffic, local dining trends, and proximity to your existing locations should also be carefully evaluated to maximize the new site’s potential.

When planning a new location, it’s also crucial to consider operational logistics.

Will the new restaurant follow the same menu and service style, or will it be tailored to fit the preferences of the new market?

Finally, upholding the same standards of quality and service that made your original concept successful is key to retaining customer trust and loyalty.

Overall, a thoughtful and strategic opening of new venues can expand your restaurant brand’s reach, boost revenue, and establish a stronger foothold in the industry.

Introducing Additional Revenue Streams

Expanding your restaurant doesn’t always require larger premises or a new location.

Diversifying your offerings to introduce additional revenue streams is an effective way to grow your business while staying within the same footprint.

One popular strategy is online ordering, which has become a standard in the industry, especially for quick-service restaurants.

As research has shown, food and delivery pickup are the main sources of revenue for such establishments.

Illustration: Tablein / Data: Kantar

If you haven’t hopped on that train yet, partnering with delivery services can be a practical way to boost sales.

Catering is another excellent option, allowing you to serve events like weddings, parties, and corporate gatherings.

With minimal investment—such as a delivery vehicle or service—catering can generate extra income while showcasing your food to a broader audience of potential customers.

Another way to expand your brand’s presence and increase revenue is by selling well-designed branded merchandise, such as t-shirts, aprons, or mugs.

Packaging and selling signature sauces, meal kits, or other unique items from your menu can further boost sales, offering customers a way to enjoy a taste of your restaurant at home.

This is exactly what Kata Robata, a Japanese restaurant in Houston, TX did.

Source: Kata Robata on Instagram

You might also consider maximizing revenue by renting out your restaurant space for private events or hosting ticketed experiences during non-operational hours.

By implementing one or several of these strategies, you can diversify your income streams and expand your brand’s reach beyond the dining experience.

These approaches not only create opportunities for immediate revenue growth but also pave the way for sustainable, long-term success without the complexities of physical expansion.

Opening a Ghost Kitchen

Opening a ghost kitchen, also known as a delivery-only restaurant, can be an effective way to expand your business while keeping costs low.

Unlike traditional restaurants, ghost kitchens eliminate the need for a dine-in space, significantly reducing overhead expenses like rent, utilities, and staffing.

This model focuses exclusively on preparing food for delivery, catering to the increasing demand for online food orders.

It’s especially advantageous for reaching customers in new areas, but without the high costs associated with opening a full-service restaurant.

There are several ways to set up a ghost kitchen.

For example, Nathan’s Famous has opened ghost kitchens by partnering with other restaurants that prepare its delivery menus.

Source: Restaurant Dive

Your other options for establishing a ghost kitchen include:

• opening a new facility dedicated to delivery orders, 
• partnering with a multi-brand ghost kitchen operator.

Additionally, if you already have a kitchen with underutilized capacity, you can launch a virtual, delivery-only brand to maximize your existing resources.

To make a ghost kitchen successful, consider partnering with multiple delivery platforms to maximize your reach.

Designing a menu tailored for delivery is equally important—focus on dishes that travel well and retain their quality during transit.

By embracing this model, you can tap into new markets and revenue streams, adapting to the growing preference for delivery while maintaining a cost-effective operation.

Creating a Mobile Concept

Launching a mobile concept, such as a food truck, kiosk, or pop-up, is a versatile way in which you can expand your restaurant’s operations.

These concepts allow you to reach new customers at different locations or events, increasing flexibility and brand visibility.

Unlike opening a new physical restaurant, such mobile operations require lower upfront costs, which makes them a cost-effective expansion strategy.

But how can you make the most of this strategy?

Well, it’s essential to focus on high-traffic areas or popular events where demand is highest. 

Additionally, offering a streamlined, high-quality menu ensures quick service and customer satisfaction.

Food trucks, for instance, are particularly effective for serving urban areas, office zones, or various events.

Source: Owensboro Times

This new food truck from J’s Good Grub includes innovative features, such as a TV menu board and a second screen for displaying local business advertisements.

The ads screen will also provide an extra revenue stream for this popular local restaurant.

Next, food court outlets or kiosks offer a great way to test the waters before committing to a full-scale restaurant venue.

Similarly, pop-up food stands allow you to explore new locations, menu ideas, or seasonal offerings without long-term commitments.

To sum up, these mobile concepts can be a cost-effective way to boost your restaurant’s brand visibility and create additional revenue opportunities.

Forming a Hospitality Group

If you’re already managing more than one restaurant under the same brand, you’re likely leveraging shared resources, such as purchasing, marketing, and staff training.

Forming a hospitality group builds on this principle but involves developing multiple distinct restaurant brands, each with its own identity, menu, décor, and customer experience.

The benefits of this expansion strategy?

Diversifying your portfolio, spreading risk across different concepts, and creating economies of scale.

Additionally, it enables cross-promotion and loyalty programs, strengthening customer retention across the group.

For instance, Bloomin' Brands exemplifies this approach by successfully managing multiple distinct restaurant brands, as shown below.

Source: Bloomin’ Brands

By operating multiple restaurant brands under one umbrella organization, Bloomin’ Brands reduces operating costs while appealing to a broader range of customer demographics.

On a smaller scale, you don’t necessarily need to form your own hospitality group to enjoy similar benefits. 

Instead, joining an existing one can provide access to shared resources and expertise.

For example, if you own or plan to open a restaurant in Los Angeles, you could consider joining SproutLA, a restaurant collective that currently supports 16 unique concepts.

Source: SproutLA

Some advantages of joining such hospitality groups include:

• access to resources like kitchen space, equipment, and supplies,
• business development support, such as marketing, branding, and menu optimization,
• cost efficiency, networking opportunities, and increased brand visibility.

This support can be crucial for chefs and restaurant owners looking to establish their presence in a competitive market.

Overall, by forming or joining a hospitality group, you can strengthen your brand(s)’ position in diverse market segments, innovate across multiple concepts, and achieve sustained growth.

How Can Online Restaurant Reservation Software Help?

As your restaurant expands—whether by opening new locations, adding more seating, or adopting mobile concepts—managing guest bookings becomes increasingly complex.

This is where online reservation software like our Tablein becomes invaluable.

Source: Tablein

Tablein enables your guests to easily make online bookings through various channels, including Google, Instagram, Facebook, TripAdvisor, and even the Michelin Guide.

Integrating Tablein’s reservation widget into these channels helps convert online searches into bookings, enhancing convenience for your guests and increasing your revenue potential.

On the management side, Tablein automates table scheduling, allowing you and your team to:

• minimize idle times,
• maximize seat utilization, and
• efficiently handle higher customer volumes.

And if you’re managing multiple restaurants or plan to do so after expansion, Tablein provides centralized reservation management.

Source: Tablein

With a single account, you and your team can sync bookings across all locations, streamlining operations and ensuring a unified customer experience.

Features like customized widgets for different restaurant brands and group discounts make Tablein an excellent choice for restaurant chains or hospitality groups.

Source: Tablein

It also integrates seamlessly with payment gateways like Stripe, allowing you to manage deposits and no-show fees efficiently.

By tracking reservation patterns and customer preferences, Tablein provides valuable insights to optimize staffing, menu planning, and targeted marketing strategies.

Source: Tablein

These insights are critical when entering new markets or optimizing operations in existing ones.

By streamlining customer bookings across multiple locations and formats, you can ensure smooth operations and a seamless experience for guests, no matter where they dine.

In summary, online booking solutions like Tablein can play a pivotal role in refining your current operations and supporting future expansion efforts.

Conclusion 

The expansion strategies outlined in this article demonstrate that growing your restaurant business can take many forms. 

Each approach requires careful planning, adequate resources, and the right tools to succeed. 

When implemented effectively, one or more of these strategies can help your restaurant(s) thrive now and in the future. 

We hope this article has been informative and inspired some great expansion ideas.