3 Ways Restaurants Earn ROI from Outdoor Heating

3 Ways Restaurants Earn ROI from Outdoor Heating

Posted by Alfresco Heating on Dec 1st 2023

There are many advantages to outdoor heating, but if you own or manage a restaurant or any other kind of hospitality establishment, the bottom line is earning a return on investment (ROI). The good news is that the return is clear, in fact, we’ve got three good reasons for you to invest in outdoor heating.

Reason #1: More Tables Mean More Profits

First, outdoor heaters maximize your seating; and, thus, it maximizes your profits.  

Think of permanent patio heaters as an investment rather than as an expense. For example, let’s assume that your restaurant has ten tables and you need to seat eight tables in order to cover your overhead. If you’re able to seat two additional tables outside because they're heated, that’s a 20% increase in revenue. In this example, without outdoor heating, you were only able to profit on two indoor tables. On the other hand, with heated outdoor seating, you now have four or more profitable tables, and you can double your potential profit at a minimum! 

This kind of expansion is very manageable. In this example, going from 10 to 12 tables, you’re probably not going to add more staff. Food costs will be slightly higher,  and your staff will be a little busier, which is a good thing. And, the wait staff will make more money, too. 

Outside heating is also a way you can expand your square footage at no additional cost.  For example, San Francisco is a friendly city regarding issuing sidewalk seating permits. As a rule of thumb, six feet of the sidewalk need to remain open for pedestrians. If your establishment fronts a 12-foot sidewalk, you may be able to use 6 feet of it without increasing your rent.

The bottom line is that the increase in operating costs is nominal, and outdoor heating will help you increase profit by increasing capacity.

Reason #2: Outdoor Heating Is a Crowd-Pleaser for Those Who Love Sitting Outside

Some people have a penchant for being outdoors and choose to dine at your restaurant because outdoor spaces are available. They may want to enjoy the view of the landscape or they may love people watching. On Columbus Avenue in the North Beach neighborhood of San Francisco, California, locals, as well as tourists, sit at heated tables on the busy sidewalk just to watch the characters passing by while they dine. At Cavallo Point Lodge, in Sausalito, California, outdoor heating allows visitors to enjoy the view of the Golden Gate Bridge, even when the fog comes in.

In this way, outdoor heating makes your restaurant more attractive to people who might otherwise choose to go somewhere else. 

Reason #3: Curb Appeal. Outdoor Heating Makes Your Restaurant More Attractive

Outdoor seating attracts attention, even more than a sign does. 

If the outdoor seating is in front of the house, on a sidewalk or front patio, it's a real attention grabber. It's the best marketinga restaurant can have for drive-by and foot traffic. When passers-by see people sitting outside, eating, enjoying themselves, they take notice.

In many areas of the country, heating outside seating is beneficial for a few months of the year. Depending on your location, the impact can be even greater. In much of the San Francisco Bay Area, for example, adding profitable seating thanks to outdoor heating has year-round benefits. If you're in San Francisco, even in summertime, outdoor heating never goes out of season.

As these three reasons illustrate, the bottom-line benefits of outdoor heating are “built-in.” Outside heating has the potential to increase your ROI in multiple ways, from more profit, to a more attractive ambiance, and to the marketing impact of “curb appeal.”

Contact Alfresco Heating for expert advice on how to heat your restaurant’s outdoor seating area. 

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