Restaurant Feasibility Study in the Duluth, MN-WI Metro Area

Duluth: a restaurant market with small tickets

For full-service restaurant loans, Duluth stands 90 of 821 among areas, and within Duluth the restaurant class ranks 1 of 39. The location quotient, 1.61x, marks the class as the top SBA class in the area and weighs it heavier than in the nation. The area crosses into Wisconsin and the files hold 57 loans for $16.8 million, FY2017 to FY2026. A $150,000 median loan compares at 0.55x with the national restaurant median, while $94,400 to $342,000 holds the middle half of restaurant loans. The median ratio is the distinctive metric: Duluth restaurant loans run small beside the country's.

St. Louis County, Minnesota has 41 loans, Douglas County, Wisconsin 10 and Carlton County, Minnesota 6. Of the restaurant approvals in Duluth, 49 came through SBA 7(a) and 8 through SBA 504. Northeast Entrepreneur Fund, Inc. holds 29 of the 7(a) loans, worth $3.3 million; Members Cooperative Credit Union holds 5 for $2.4 million. The lender rows show the current holder SBA lists, without judging how Northeast Entrepreneur Fund, Inc. lends. Holdings, not wishes. The median of $150,000 and the middle half from $94,400 to $342,000 are the range a study should place its request against.

Loan Analytics prints no floor for post-approval cancellations in Duluth and no charge-off rate, because the count falls short; read both as missing. By year, Duluth shows 10 loans and $5.9 million in FY2017, 15 and $2.6 million in FY2018, 8 and $3.2 million in FY2019, 9 and $747,200 in FY2020, and 5 and $645,800 in FY2021.

Because one community lender holds 29 of the 57 loans, a study should say how the proposed project would sit beside that concentration.

What a Duluth restaurant study must test

A study should test seasonal swings, including how sales swing by season; seat counts against local demand; lease cost against sales; payroll for the local labor pool; and whether a smaller loan can carry both equipment and working capital. The appraisal question is mostly leasehold and equipment value. A restaurant loan counts toward Duluth by the county of its project under the July 2023 boundaries; loans with unplaceable counties are skipped. These records give background only, and approval is the lender’s call.