A good restaurant in a poor location will become a poor business!
The number one reason for restaurant failure or poor performance is due to a poor location. A poor location ultimately results from poor site selection. How else can you explain that identical restaurants from the same chain or franchise system will vary as much as 200% in sales volumes? Of course you will need to factor in store size, marketing budgets, management and so on; however, these are all secondary to the importance of location, in my opinion.
There are essentially three types of restaurant businesses: profitable, break-even and go-broke. A truly profitable restaurant location will make money and the business will appreciate in value. A break-even restaurant location will pay the owner a small salary and pay the rent but not much more. The go-broke location that comes to my mind lasted less than three months from opening to closing for one unfortunate tenant. Despite my warnings that this was a go-broke location, the business owners poured in $80,000 into their store setup and couldn't pay their rent by the second month of operation. Usually, a go-broke location will not only steal your capital but also put you into personal bankruptcy - after you have maxxed out your credit.