The purposes of this study were to a) examine using status, b) measure the service quality attributes, c) analyze IPA and customer satisfaction, d) develop the LSM(Local Store Marketing) by location of K theme restaurant such as residential type(A), complex type(B) and downtown type(C). The questionnaires were handed out to 346 of 450(usage rate 76.9%). The statistical data analysis was completed using SPSS(ver 12.0) for descriptive analysis, $X^2$, t-test, ANOVA, reliability analysis, factor analysis, multiple linear regression. From an analysis on service quality attributes, most importance of service quality attributes was more highly perceived than performance of those, except for 'attractive exterior', 'variety of kid's menu', 'convenient facilities for kid' and perceived importance and performance were also significantly different by location of branch restaurant. The attributes to be improved were 'convenience of restaurant's parking lot', 'food tast', 'speedy service' and 'service competency' as branch A(residential type) restaurant, 'convenience of the restaurant location' as branch B(complex type) restaurant and 'convenience of the restaurant location' and 'speedy service' as branch C(downtown type) through IPA analysis. The Overall customer satisfaction was 3.74 and service quality factors had significant effect on overall customer satisfaction. Location of restaurant, which gives a great effect on its operation and marketing, has a important correlation with success or failure of restaurant business enterprises. Therefore, marketing strategy by restaurant location should be developed.