Lendingtree : Milwaukee, Cincinnati and Minneapolis Are the Most Promising Places to Open a Restaurant

CHARLOTTE, N.C., Oct. 24, 2018 /PRNewswire/ -- LendingTree®, the nation's leading online loan marketplace, today released its study on the best cities to open a restaurant. The study found that while traditional foodie destinations like New York and San Francisco are saturated with restaurants, up-and-comers have room to grow. The restaurant population in cities like Milwaukee, Cincinnati and Minneapolis cities is less dense than in other areas, and labor costs are lower.

LendingTree analyzed the 50 largest U.S. cities to see which offer prospective restaurateurs the best shot at success. Many top spots are in once-overlooked Midwestern cities now experiencing urban renewal. The least promising cities have historically been the restaurant industry's most competitive.

To find out where prospective restaurant owners may have a better chance at succeeding, LendingTree looked at four factors within the 50 largest metros in America:

• Average estimated annual revenue. Using the reported monthly deposits of more than 5,400 restaurant owners who sought loans on the SnapCap by LendingTree business loan platform, researchers estimated their annual revenues and adjusted them based on prices in their particular city.
• Estimated payroll costs per employee. To get a sense of where labor costs may have a smaller impact on restaurants, the study looked at total annual payroll and employees for restaurants in each metro, as reported in the County Business Patterns survey from the U.S. Census Bureau to calculate the average annual cost per employed person.
• Number of restaurants per 100,000 households with incomes of $50,000 or more. These households spend the most on eating out, according to the Bureau of Labor Statistics, but some metros may be underserving these households eager for new restaurant choices.
• Number of restaurants per 100,000 residents aged 35-54. Gen Xers have a greater appetite for restaurant spending than millennials or baby boomers, according to the same BLS survey. This may present an opportunity for cities dominated by this generation with relatively few restaurants.

Opportunity is ripe in 'flyover country'

1. Milwaukee

Final score: 82.5

Milwaukee ranked highest in the study, earning a score of 82.5. There are 709 restaurants per 100,000 households with an income of $50,000 or more. Among residents between the ages of 35 and 54 – the age group that spends the most on dining out – there are 591 restaurants per 100,000 people.

2. Cincinnati

Final score: 78.4

While Cincinnati's restaurant scene is prosperous, the majority of eateries in the city are chain establishments. Residents tend to prefer independent restaurants, creating a prime opening for prospective local restaurateurs.

3. Minneapolis

Final score: 77.4

Ranking No. 3 in the study, Minneapolis has even fewer restaurants among the designated demographics. There are 629 establishments per 100,000 households with $50,000 or more in income, and 574 restaurants per 100,000 residents between the ages of 35 and 54 years old.

Entrepreneurs face challenges in culinary capitals

The lowest-ranking metros are cities with world-renowned restaurant scenes. The local restaurant industry is overcrowded in these places, making it difficult for new restaurant owners to be successful.

50. New York

Final score: 17.3

New York ranked last at No. 50, earning a score of 17.3. The adjusted median revenue is relatively low, $224,640, and payroll costs are high at an average annual payroll per employee of $22,581. There are 993 restaurants per 100,000 households with incomes of $50,000 and 791 establishments per 100,000 residents between the ages of 35 and 54.

49. San Francisco

Final score: 24.8

San Francisco, in the No. 49 spot, is about as equally dense but restaurants in the area rake in more money. The normalized median revenue for restaurants in the city is $361,440, but the average annual employee payroll is $23,325, which means even higher labor expenses than New York.

48. New Orleans

Final score: 32.3

The third least promising place to open a restaurant is New Orleans. Though far smaller by population compared with New York and San Francisco, the Southern city has more a competitive restaurant scene. There are 1,069 eateries per 100,000 households with $50,000 in income, and 759 restaurants per 100,000 residents between the ages of 35 and 54.

To view the full report, visit www.lendingtree.com/business/best-places-to-open-a-restaurant.

Rank	Metro	Final Score	Est. Median Revs, RPP Normalized	Avg. Annual Payroll per Employee	Establishments per 100K Households w $50K+ Income	Establishments per 100K Residents Aged 35-54
1	Milwaukee	82.5	$350,784	$14,510	709	591
2	Cincinnati	78.4	$370,944	$14,813	757	613
3	Minneapolis	77.4	$293,100	$17,094	629	574
4	Louisville, Ky.	76.3	$360,000	$14,979	794	600
5	Raleigh, N.C.	75.3	$356,022	$15,396	786	600
6	Riverside, Calif.	71.8	$377,808	$17,675	847	544
7	Kansas City, Mo.	70.7	$255,120	$16,489	709	588
8	Hartford, Conn.	70.2	$472,800	$18,119	748	685
9	Richmond, Va.	69.1	$299,232	$15,221	781	634
10	St. Louis	68.7	$275,184	$15,381	757	630
11	Austin, Texas	68.3	$408,000	$18,281	785	627
12	Memphis, Tenn.	67.8	$143,880	$14,696	790	540
13	Houston	66	$283,392	$17,462	793	578
14	Phoenix	65	$209,916	$17,014	759	568
15	Charlotte, N.C.	63.7	$217,260	$15,237	844	591
16	Baltimore	63.2	$222,720	$17,602	690	624
17	Salt Lake City	62.7	$307,836	$15,946	827	661
18	Columbus, Ohio	62	$166,920	$15,575	768	610
19	Tampa, Fla.	61.9	$180,360	$16,785	783	573
20	Pittsburgh	61.7	$228,312	$14,673	777	684
21	Detroit	61.4	$124,920	$15,296	775	589
22	Philadelphia	60.2	$237,132	$16,608	777	646
23	Indianapolis	59.6	$205,824	$15,434	836	628
24	Atlanta	58.7	$223,992	$16,183	866	609
25	Denver	57.7	$327,120	$18,993	773	669
26	San Antonio	57.1	$202,752	$16,472	859	606
27	Birmingham, Ala.	56.2	$106,752	$15,771	815	593
28	Chicago	55.5	$277,056	$18,497	813	645
29	Jacksonville, Fla.	55.3	$225,072	$15,694	883	653
30	Washington	55	$174,744	$19,517	678	626
31	Sacramento, Calif.	54.5	$258,720	$17,475	824	668
32	Nashville, Tenn.	52.7	$253,440	$17,215	873	662
33	Cleveland	50.1	$118,584	$15,166	841	673
34	San Jose, Calif.	49.9	$437,400	$21,724	842	711
35	Dallas	49.8	$131,736	$17,399	835	619
36	Virginia Beach, Va.	48.5	$245,040	$15,128	894	757
37	Oklahoma City	47.6	$156,096	$14,743	900	706
38	Las Vegas	46.7	$355,656	$20,250	963	653
39	Orlando, Fla.	45.4	$244,800	$17,726	998	641
40	San Diego	43.9	$366,606	$19,972	914	733
41	Buffalo, N.Y.	42.1	$152,064	$16,309	869	735
42	Miami	41.2	$194,040	$18,892	991	617
43	Seattle	39.1	$343,680	$21,851	842	757
44	Los Angeles	38.7	$355,536	$19,634	1036	717
45	Portland, Ore.	38.4	$271,308	$19,125	916	748
46	Boston	37	$288,036	$20,570	844	777
47	Providence, R.I.	32.9	$252,756	$17,781	982	797
48	New Orleans	32.3	$251,520	$17,426	1069	759
49	San Francisco	24.8	$361,440	$23,325	938	823
50	New York	17.3	$224,640	$22,581	993	791

About LendingTree

LendingTree (NASDAQ: TREE) is the nation's leading online marketplace that connects consumers with the choices they need to be confident in their financial decisions. LendingTree empowers consumers to shop for financial services the same way they would shop for airline tickets or hotel stays, comparing multiple offers from a nationwide network of over 500 partners in one simple search, and can choose the option that best fits their financial needs. Services include mortgage loans, mortgage refinances, auto loans, personal loans, business loans, student refinances, credit cards and more. Through the My LendingTree platform, consumers receive free credit scores, credit monitoring and recommendations to improve credit health. My LendingTree proactively compares consumers' credit accounts against offers on our network, and notifies consumers when there is an opportunity to save money. In short, LendingTree's purpose is to help simplify financial decisions for life's meaningful moments through choice, education and support. LendingTree, LLC is a subsidiary of LendingTree, Inc. For more information, go to www.lendingtree.com, dial 800-555-TREE, like our Facebook page and/or follow us on Twitter @LendingTree.

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SOURCE LendingTree