How to Conduct a SWOT Analysis for a Restaurant

Photo of author

By Jacob Maslow

Conducting a restaurant SWOT analysis is essential for all restaurant owners. It doesn’t matter whether you are a minor player in the restaurant business, a larger company looking to gain an even larger market share, or perhaps holding on to what you have.

Companies should regularly conduct a SWOT analysis, especially if a business plans to enter a new market.

But what is a SWOT analysis? How does a restaurant carry one out? Let’s explain.

What is a Restaurant SWOT Analysis?

We understand that there may be many of those in the restaurant industry who aren’t quite sure what a SWOT analysis is. This is fine. However, you must become familiar with the concept. This is because it will be a part of your restaurant business plan.

A SWOT analysis is not just limited to restaurants. It is something that all businesses need to do, although we are focusing purely on restaurants here. Reviewing a SWOT analysis of any company you invest in is also a good idea. Here is a SWOT Analysis of Tesla.

A SWOT analysis is an acronym for Strengths, weaknesses, Opportunities, and Threats. With a SWOT analysis, restaurants are going through what their business does right, what it gets wrong, and what may or may not impact their business in the long term.


Strengths are the things that a business gets right. It is the things that make people flock to your business. It may be good food. It may be unique dishes. It may be the high pay that you give your staff.


Restaurants must look at the weaknesses of a restaurant. These are the things that a company may not get right and may need further improvement. For example, cleanliness can be an issue, as there can not be enough staff during the busier periods of the day.


Opportunities are new areas that may be open to restaurants in the future. For example, new ways to get foot traffic through the door and changes to the menu may help. Even the loss of other companies in the city may be an opportunity for a business since they can open themselves up to enter new markets.

Anything that could potentially benefit the business will be an opportunity. It doesn’t mean a business needs to follow through on these opportunities; it knows it can enter them if it wishes.


These are external factors that may influence the business. Restaurants may not have much control over these threats, but they must be wary of them. For example:

  • New restaurants in the area could cause restaurant guests to fall.
  • Economic woes may result in people eating out less.
  • Rent increases.
  • Bill increases.

If a business can identify potential threats, it will find it far easier to combat them.

Why You Need To Do a SWOT Analysis

A restaurant’s SWOT analysis is essential. It’s a powerful tool for both new and existing restaurants to gauge their overall health. For new restaurants, a SWOT analysis helps identify the right approach to enter the market.

By offering unique services instead of following competitors, they can attract more customers. Existing restaurants benefit from conducting a situation analysis to pinpoint strengths and weaknesses. By making strategic changes, they can greatly improve their success. 

For example, local eateries can eliminate weaknesses and quickly draw in new patrons. Restaurants that conduct SWOT analyses gain a significant advantage in today’s challenging market. Those that neglect this crucial step are destined for failure.

Look At Restaurant SWOT Analysis Examples

Now we know the basics of why you need to be doing a SWOT analysis for your restaurant, let’s talk about how you can carry one out.

Your first step is to look at examples of the SWOT analysis example at the bottom of this article. Get a feel for the format. Find out what you need to be thinking about. If this is your first time putting together a list of your strengths, weaknesses, opportunities, and threats, then this information can be significant.

Why Reading a Restaurant SWOT Analysis Example Is Important

Many people doing their first SWOT analysis may not know what goes into creating one. This isn’t a surprise. There isn’t a wealth of information out there. You may be told that you need to do one, but not why you need to do one.

Examples will show you that you need to look at your business critically. You can have some pretty harsh criticism for your business. The harsher the complaint, the better. Many people never do this; examples should set you on the right path.

Don’t Copy The Examples

This is important. Never copy anything you read. Produce something unique. The issues of another company are not like yours. Copying their information is futile. It benefits your company in no way whatsoever. We gave examples of the significant chains, and you want to do something unique and different.

Solicit Feedback From Staff and Customers

Once you have looked at some examples, the next step in a restaurant SWOT analysis is to start getting feedback.

Encourage Honesty

You must encourage honesty when you are soliciting feedback on your business. Don’t just go up to people and ask them for their opinions. That won’t give you the competitive edge as they will be positive.

Look at all sources of information. Get people to submit anonymous feedback cards (particularly your staff) and look at online reviews for your business. There are plenty of great resources that you can tap into on that front.

Gather as much information as you can. If the same issues keep coming up about the dining experience (or the same pros), then that can be worked into the SWOT analysis.


Ask your staff about the strengths and weaknesses of working there. Again, try to get this feedback anonymously. The team may not be looking to give their criticism to the business owner.

Your staff will be dealing with customers all day in the restaurant, so they will hear what the customers say. However, your staff may have other ideas about how the business is being run.

Customer Feedback

Customers can be harsh, and that is precisely what you want. You want them to be honest in what they say. Know whether they like the food. Whether the location is a good place for them, etc.

Not everything that your customer says will have value. Some restaurants hear insane feedback from customers that isn’t rooted in truth. But, consider as much advice as possible. It will give you an advantage.

Come Up With Your Ideas

You will also need to have your ideas about the business. There are internal factors that your staff won’t be privy to, e.g., industry positioning, rising costs (including building rent, etc.)

You must also consider the restaurant market to build up your strengths and weaknesses. Honestly, a restaurant SWOT analysis is a pretty research-intensive exercise.

Preparing Your SWOT Analysis For a Restaurant

Once you have gathered some feedback, you can build your restaurant SWOT analysis. How you approach this is up to you, but we encourage you to include as much information as possible in your analysis. Although, we do understand that some businesses will bullet-point everything.

In this section, we will give you some ideas about the things you would need to consider. For each team on your SWOT, try to come up with 5-10 different points (at minimum) and, once again, don’t forget to be brutally honest.


You can get off on a positive foot by looking at your restaurant’s strengths.

As mentioned, your restaurant’s strengths are things your company gets right. For example, it may be the following:

  • Good food
  • Good selection of menu items
  • Clean location
  • Your staff is never run off their feet during busy periods so everybody is served quickly.
  • You are not over-staffed during slow times.
  • You have a strong brand that people have heard of. We don’t expect you to have a strong McDonald’s brand, but something people know of.

Essentially, this is a list of all the pros of your business. Since many business owners tend to think way too highly of their company, you will need to look into feedback here.


These are areas where your business may be suffering. For example, a restaurant may have the following problems:

  • Poor quality food
  • A bloated management team
  • Require better service
  • A bloated menu that pushes costs up
  • Slow delivery of items during rush hours.

Be critical of all of your service areas here. You will improve on these aspects later on, but weaknesses will be essential for improving your restaurant, so ensure you get this right.

We like to think of this as thinking about what your restaurant lacks. What is your idea of a good restaurant? Look to your competitors here. You may look at competitors that have the same restaurant type. For example, if you were running a Michelin-star restaurant, you wouldn’t compare yourself to a Denny’s.



Opportunities are areas that could lead to growth for your business. You do not have to follow through on all opportunities; know they are there. For example:

  • A new residential area may be being built, leading to increased sales for your business.
  • Trends may be pushing your particular food a lot. Always look to social media for trends.
  • There may be a cheap way to expand your business.
  • Increased marketing campaigns may lead to better business.
  • Opportunities to increase menu items with better food.
  • Introduction of online ordering


For many, this may be the most challenging section to put together. However, it is easy. We promise. Considering all the external factors that could influence your business would be best. For example:

  • If a new competitor is entering the arena
  • Rising supply costs
  • If the chef you own leaves, could you survive without them?
  • Adverse changes to the economy.
  • Rising operational costs

These are the things that are out of your control. However, you must be aware of them so you know how to deal with them.

Your opportunities and threats should be considered together because you may notice some options as you go through the negative aspects. For example, a poorer economy can result in losing your competitors but can increase your opportunities to wrap up a market.

Conclusion – Restaurant SWOT Analysis

We have included a lot of information here, but we assure you that putting together a SWOT analysis for your restaurant isn’t all that difficult. However, it is something that will benefit your company in a lot of ways.

Remember, try to review your SWOT analysis at least once a year. This way, you can see the progress that your company is making.


Images Courtesy of DepositPhotos