Thinking of Buying a Restaurant in Australia? Here Are 3 Vital Questions to Ask

The Australian restaurant industry generated $24.1 billion in revenue in 2025, employing 176,697 people across 29,116 enterprises. Profit margins averaged 3.9%, reflecting strong competition and high input costs.

Revenue has grown at 6.6% annually over the past five years but contracted by 2.2% in 2024–25 due to cost-of-living pressures. Looking ahead, revenue is forecast to rise modestly at 1.0% annually through 2030, reaching $25.5 billion. Growth will be supported by population increases, multicultural dining, and takeaway services, though profitability will remain challenged by wages, rent, and food prices.

1. Is the Business Financially Resilient in a Low-Margin Industry?

Why It Matters

Restaurants operate in one of the most competitive segments of hospitality. Margins are slim, with profitability depending on efficient operations, strong cash flow management, and adaptability to fluctuating demand. Businesses that diversify into takeaway and delivery alongside dine-in are more resilient.

What to Check

• Profitability – Benchmark against the industry’s 3.9% average margin.

• Revenue sources – Assess reliance on dine-in versus takeaway and delivery channels.

• Cost base – Review wage costs, rents, utilities, and food price exposure.

• Cash flow resilience – Examine how the business performs during downturns in discretionary spending.

2. Does the Restaurant Have Strong Market Positioning and Customer Demand?

Why It Matters

Market positioning is critical in such a crowded sector. Restaurants that stand out with unique cuisine, premium service, or community engagement attract repeat customers. Location in high-footfall areas is a key success factor.

What to Check

• Menu and concept – Confirm distinctiveness, quality, and alignment with local demographics.

• Customer base – Review reliance on locals, tourists, students, or office workers.

• Reputation – Assess online ratings, social media presence, and word-of-mouth.

• Location – Consider accessibility, visibility, and proximity to competitors.

3. Is the Business Positioned for Future Dining Trends?

Why It Matters

Trends in takeaway growth, health-conscious eating, and sustainability are reshaping the restaurant sector. Operators that adapt with innovative menus, eco-friendly practices, and digital ordering will be better placed for long-term success.

What to Check

• Delivery and takeaway – Review integration with Uber Eats, DoorDash, or in-house systems.

• Health focus – Confirm inclusion of plant-based, allergen-friendly, and lighter menu items.

• Sustainability – Assess practices for sourcing, packaging, and food waste management.

• Technology adoption – Evaluate use of online bookings, loyalty programs, and digital engagement.

Ready to Invest in a Thriving Restaurant Business?

With strong long-term demand supported by population growth and Australia’s dining culture, restaurants remain attractive investments despite margin pressures.

Success will depend on careful financial management, strong market positioning, and readiness to align with future consumer trends.

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