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Running a restaurant can be a rewarding experience. Waterfront restaurants can be even more so, with stunning views, a peaceful atmosphere and the chance to get a lot of business.

As many benefits as there are to opening a waterfront restaurant, they won’t come by themselves. It takes a lot of forethought and a solid strategy to succeed in this line of business. In that spirit, here are five tips to keep in mind when opening a restaurant on the waterfront.

1. Inspect the Market Closely

Some experts say the number one reason businesses fail is that they don’t investigate their market. If you want to succeed on the waterfront, you’ll have to know the area. You need to understand availability, your competition, what consumers want and if there are any unmet needs or desires.

Compare a few locations and see what other businesses are in the area. If there are a lot of other restaurants, there may be too much competition. If there are none, see if you can find out why. Look into what people in the area like to do and why they may travel somewhere else to do things, finding potential niches to serve.

2. Find What Makes You Unique

Once you understand your market, you can focus on how you’ll stand out in it. It’s not enough to just be a place that serves food with a good view. Do you specialize in a certain kind of dish? Do you have a unique service model? Is your decor quirky? Find something that makes you different.

This often boils down to finding and serving a specific niche. Look for four key consumer elements to help you find a niche that works:

Easily identifiable customersAccessible customersAn underserved marketA large potential market

If you can find a market base that meets these four qualifications, you can hone in on them to create a successful restaurant.

3. Take Full Advantage of Your Options

One way to help you stand out is to capitalize on your location. If you already have property on the water, why not lean into it and offer other amenities and activities? You could run boat tours, snorkel equipment rentals, surfing lessons or anything else to expand your business.

Look for unmet needs to figure out which extra services would benefit your business the most. Remember to acquire any necessary skills and knowledge, too, like how to operate a boat lift safely to ensure you don’t take on more than you can handle.

4. Get the Right Insurance

Insurance is easy to overlook when planning everything else, but you shouldn’t ignore it. Nine of the ten costliest weather events in the past decade have been hurricanes, which waterfront businesses are particularly vulnerable to. Having insurance against extreme weather will offset these potentially high costs.

Compare rates from various insurers to see how you can get the most coverage for the lowest rate. Even then, expect to pay higher premiums than you would farther inland. However, many companies offer perks for combining policies, so you may be able to save some money by bundling your insurance.

5. Expect High Costs

Solid financial planning is essential for running a successful business. If you’re planning on opening a waterfront restaurant, you should plan for high operating expenses. Waterfront property is expensive, you’ll face high competition and your insurance will likely be costly.

Gross margins for waterfront restaurants typically fall around 43%, lower than some more traditional businesses. While that can be challenging, if you expect and plan for it, you can have a smoother start to your business. Look for affordable equipment solutions and aim for timid growth, and you’ll see more success.

Start Your Waterfront Restaurant Off Right

Opening a waterfront restaurant comes with its fair share of obstacles, but none of them are too big if you know what to expect. With the right preparation, you can get your restaurant running with minimal bumps in the road.

These five steps will help you ensure success for your waterfront restaurant. You can then enjoy all this business has to offer.