Optimal location selection of a casual-dining restaurant using a multi-criteria decision-making (MCDM) approach

Abstract

The location of a restaurant contributes greatly to its success or failure. Therefore, the factors affecting such location-related decisions must be carefully studied and prioritized systematically. This study aims to adapt the analytical hierarchy process (AHP) for selecting the optimal location for a casual-dining restaurant and determine the critical factors affecting the selection. After a comprehensive review of the literature, this study first determines the factors affecting casual-dining restaurant location selection and then applies AHP steps by soliciting experts' opinions under several criteria and sub-criteria. The AHP model used in the study consisted of seven criteria, twenty-five sub-criteria, and three locations alternatives. The three most important criteria that affect the location selection of the casual-dining restaurant are Costs, Location, and Traffic patterns and accessibility, respectively. To illustrate the framework of using AHP as a tool to select the right location for a casual-dining restaurant, three locations were nominated and ranked according to the calculated weight scores of the criteria. Moreover, the results of the sensitivity analysis show that the location alternatives are not sensitive to the physical characteristics, location, area's future, costs, or, competition criteria, while they were slightly sensitive to the visibility, and traffic patterns criteria. The results of the study provide a range of managerial implications that may guide casual-dining restaurant investors in choosing the optimal location.