Dishing It Up With the right recipe for success, your ethnic fast-food restaurant will reach a hungry market.

Q: I am planning to open an ethnic fast-food business.How do I find the right location, and what can I do to help mybusiness stand out from the popular and established fast-foodchains?

A: Ed Engoron, president and CEO of Los Angeles-based foodconsulting firm Perspectives/The Consulting Group Inc., has morethan 30 years of experience in the industry:

This is the perfect time to open an ethnic quick-servicerestaurant if you adhere to a few proven adages, and, mostimportant, don't set as your goal a plan to take overMcDonald's. Your greaBODY advantage is America'sopen-mindedness toward taste trends, which is a result of Americanstraveling abroad more than ever before and the influx of immigrantsbringing their cultural preferences for particular, seasonings andspices with them.

Contrary to the old saying, America is better described as apatchwork quilt than a melting pot and this definitely works inyour favor. Our nation has been introduced to virtually everyethnic flavor on earth, and consumers in many new taste sensationson an ever increasing basis. But an exciting menu is not enough toensure success. When asked about the three most important factorsfor fast-food success, McDonald's founder Ray Kroc declared,"Location, location, location." Indeed, in the finalanalysis, location will most likely determine the profitability ofyour venture.

But how do you select your ideal location? To begin with, youmust know your target audience specifically, whether they arepredisposed to buying the food you want to sell. You could bedishing up the greaBODY saag paneer ever created and be situated ona prime piece of real estate, but if nobody in the area likesIndian food, you're going to have a lot of troublesucceeding.

You can do some location research yourself by contacting theU.S. Census Bureau and requesting market demographic information.Or, you can enlist the help of a market research firm to collectand analyze demographic data for you. But remember that no matterwhat, you'll need to visit the sites you're considering inperson to answer the following questions:

Who is your competition in the area? What are people eating?What are people wearing? What side of the street would be best foryour restaurant? Is there plenty of parking? Is there sufficientfoot and street traffic to supply plenty of customers? Is thelocation convenient? During what times of day is the busiest? Makesure you're situated between at least two well-traveledarteries like malls, places of work and homes.

As for the second part of your question making your businessstand out from competitors keep in mind that it is very expensiveand nearly impossible to educate people about food. People knowwhat they like and they like what they know, and will onlygradually make changes in their diet. For example, even with allthe hubbub about health, nutrition, fat intake and cholesterolcounts, 60 percent of fast-food restaurant products still come outof the deep fryer. That means the public hasn't been listeningto the Food and Drug Administration admonitions over the past 20years, or they don't care. To you, it doesn't matter; theresult is the same.

The fact is, ethnic food is fundamentally foreign, and it'sa wise restaurateur who introduces unusual foods in such a way asto make them seem familiar. At the very least, describe your dishesin a language your target customers will understand. The saagpaneer mentioned earlier, for instance, could be billed as creamyspinach with spices and homemade cheese.

So armed with this knowledge, how can you best situate yourselffor success? While there are no guarantees, applying the followingthree-part strategy may help you gain a competitive edge: 1) Takethe fast food pledge, I will offer convenience, fast and friendlyservice, and great taste at a low price; 2) go after the big check(Why chase the 99 cent breakfast when there are $5 dinners to beeaten?); and 3) don't compete with the biggies you'll neverbeat McDonald's. They not only do what they do very well buthave years of service and a strong reputation behind them. Insteadof trying to beat them at their own game, offer your customerssomething different.

Also consider taking your quick and delicious ethnic food out ofthe traditional fast-food race and entering it into thehome-meal-replacement market. Instead of settling for afeedbag-in-the-car experience, your customers can pick up readymade dinners and serve them at home. Americans still tend toperceive fast-food chains as snack and lunch stops, not places toprovide their main evening meal. But chains like Boston Market havehad great success catering to home-meal-replacement customers.

Almost 70 percent of Americans consume their meals at their owndinner tables. That's a huge potential market for home-mealreplacement. (See the December 1996 issue of BIZ Experiences for moreon the ethnic-food and home-meal-replacement trends.)

Opening a quick-service restaurant, or any restaurant for thatmatter, is a challenging task in the best of circumstances.Although taking on specialty food is particular ambitious, with theright product formula, service and positioning, you could begetting into the market at exactly the right time. Good luck!

Contact Sources

Perspectives/The Consulting Group Inc., fax: (301)479-8448, 74521.1165@compuserve.com.