What can I do to make this function run faster? I feel like it takes longer than I'd like and i want some optimization tips.

function [Location,x1,x2,y1,y2] = FindWaldo(WheresWaldo1,Waldo1)
%Converting the image of waldo to grayscale
[rowW1,colW1,~] = size(Waldo1);
for r = 1:rowW1
    for c = 1:colW1
        R(r,c) = Waldo1(r,c,1);
        G(r,c) = Waldo1(r,c,2);
        B(r,c) = Waldo1(r,c,3);
    end
end
dim1 = size(Waldo1,1);
dim2 = size(Waldo1,2);
Waldo1gray = zeros(dim1,dim2,'uint8');

for x = 1:dim1
    for y = 1:dim2
        Waldo1gray(x,y) = ((R(x,y).*.2989)+(G(x,y)*.587)+(B(x,y).*.114));
    end
end

[rowWW1,colWW1,~] = size(WheresWaldo1);
for r = 1:rowWW1
    for c = 1:colWW1
        R(r,c) = WheresWaldo1(r,c,1);
        G(r,c) = WheresWaldo1(r,c,2);
        B(r,c) = WheresWaldo1(r,c,3);
    end
end
dim1 = size(WheresWaldo1,1);
dim2 = size(WheresWaldo1,2);
WheresWaldo1gray = zeros(dim1,dim2,'uint8');

for x = 1:dim1
    for y = 1:dim2
        WheresWaldo1gray(x,y) = ((R(x,y).*.2989)+(G(x,y)*.587)+(B(x,y).*.114));
    end
end

%Converting the background image to grayscale
[row,col] = size(WheresWaldo1gray);
[row1,col1] = size(Waldo1gray);
Break = 0;
Foundy = zeros(row1-1,col1-1);
Foundx = zeros(row1-1,col1-1);

%Making matricies of waldo's location in the background
for r = 1:row
    for c = 1:col
        if WheresWaldo1(r,c) == Waldo1(1,1)
            for r1 = 1:row1
                for c1 = 1:col1
                    m = length(Foundy);
                    n = length(Waldo1gray);
                    if m == n
                        Break = 2;
                        break
                    end
                    if WheresWaldo1(r+(r1-1),c+(c1-1)) == Waldo1(r1,c1)
                        Foundy(r1,c1) = r+(r1-1);
                        Foundx(r1,c1) = c+(c1-1);
                        continue
                    else
                        Break = 1;
                        break
                    end

                  end
                  if Break == 1
                      Break = 0;
                      break
                  elseif Break == 2
                      break
                  end
              end
          end
          if Break == 2
              break
          end
      end
      if Break == 2
          break
      end
  end

[y2loc,~] = size(Foundy);
[~,x2loc] = size(Foundx);

%Collecting the location of Waldo for printing
y1 = Foundy(1,1);
y2 = Foundy(y2loc,1);
x1 = Foundx(1,1);
x2 = Foundx(1,x2loc);

%Getting range values for red lines
yrange1 = [y1-7,y1-6,y1-5,y1-4,y1-3,y1-2,y1-1];
%xrange1 = x1:x2;
%yrange2 = y1:y2;
xrange2 = [x1-7,x1-6,x1-5,x1-4,x1-3,x1-2,x1-1];
yrange3 = [y2+1,y2+2,y2+3,y2+4,y2+5,y2+6,y2+7];
%xrange3 = x1:x2;
%yrange4 = y1:y2;
xrange4 = [x2+1,x2+2,x2+3,x2+4,x2+5,x2+6,x2+7];

%Drawing top red line
for r1 = x1:x2
    for c1 = yrange1(1):yrange1(7)
        WheresWaldo1(c1,r1,1) = 255;
        WheresWaldo1(c1,r1,2) = 0;
        WheresWaldo1(c1,r1,3) = 0;
    end
end

%Drawing left red line
for r2 = xrange2(1):xrange2(7)
    for c2 = y1:y2
        WheresWaldo1(c2,r2,1) = 255;
        WheresWaldo1(c2,r2,2) = 0;
        WheresWaldo1(c2,r2,3) = 0;
    end
end

%Drawing bottom red line
for r3 = x1:x2
    for c3 = yrange3(1):yrange3(7)
        WheresWaldo1(c3,r3,1) = 255;
        WheresWaldo1(c3,r3,2) = 0;
        WheresWaldo1(c3,r3,3) = 0;
    end
end

%Drawing right red line
for r4 = xrange4(1):xrange4(7)
    for c4 = y1:y2
        WheresWaldo1(c4,r4,1) = 255;
        WheresWaldo1(c4,r4,2) = 0;
        WheresWaldo1(c4,r4,3) = 0;
    end
end
%Saving picture with waldo marked
Location = WheresWaldo1;
end

Answer 1

[the cyclist]

A few thoughts:

Broadly, you should learn how to profile your code. This will show you where the slow parts of your code are. Focus on those.

MATLAB is vectorized, so everywhere you have code like this

for r = 1:rowWW1
    for c = 1:colWW1
        R(r,c) = WheresWaldo1(r,c,1);
        G(r,c) = WheresWaldo1(r,c,2);
        B(r,c) = WheresWaldo1(r,c,3);
    end
end

you could instead have written this

R(1:rowWW1,1:colWW1) = WheresWaldo1(1:rowWW1,1:colWW1,1);
G(1:rowWW1,1:colWW1) = WheresWaldo1(1:rowWW1,1:colWW1,2);
B(1:rowWW1,1:colWW1) = WheresWaldo1(1:rowWW1,1:colWW1,3);

without the for loop.

If you do need to use for loops, you should learn to preallocate the memory for them.

Finally, if you upload a MAT file with a typical input to this function, we could run your code and possibly give more specific advice.