When opening or relocating a brick-and-mortar store, the location of your new store is a serious issue to think about. Location is really important because a proper location will get people into your store to buy your product. When opening your business in particular, you have to take into consideration many different aspects of your business. The wrong location can tear apart a business while the right location can help a business grow and profit.
So what makes a location right for your business?
Overall, it is a subjective opinion. What might be right for one business, like a family-owned diner, could be very, very wrong for another business, like an after-school tutoring center. There are many aspects of your business you need to take into consideration when choosing a new location such as what sort of customer you are looking for and how to target those demographics.
When looking at your location, think about a few key things such as
· Plan for Future and Further Growth
· Location in Regards to Suppliers
· Zoning Rules
· Local Labor Market
· A Business-Friendly Area
As a small business small business owner, you need to be thinking about the needs of your business and customers when considering a location.
Do you need customers to visit you on a daily basis? Will you have walk-in business or will customers make appointments? How do you get your goods delivered to your storefront? Does your business involve anything that may violate zoning restrictions? Make a list of business-specific needs and think about how a location can fulfill those needs.
Demographics are also a very important part of choosing a location for your company, so keep an eye on your customers.
Get a demographic overview of the area you’re thinking of moving into – income, age, households, etc. There are location analysis tools that will explain traffic patterns, demographic, and local lifestyle data as well as analyses of competitors in the area. Most of this information you can find out by talking to people and asking them about the location you’re thinking of. It’s also very easy to access demographical information from the U.S. Census Bureau or local and state agencies.
Try to stay close to your ideal customer.
You need to go to the customer and not expect them to come to you. Something more convenient to your customers and closer to your ideal demographic is better than some place on the edge of an area nearby. Think like your customer would, so after you’ve done your research and gathered information, create your own idea of your ideal demographic. If you want to open an after-school center for toddlers, try to find a open place near a local pre-school in an area with many families, specifically ones with two-income households, so you know to target families who may need some after-school care for their kids.
Once you have found a location you like, ask around.
See how often people walk through this area and how much foot traffic your store will get. Look at neighborhood traffic and the places or events that increase traffic like offices, parks, schools, colleges, and hospitals. Look at highway and foot traffic, too. Try to think about your ideal hours, and then find a location with a good traffic flow around that time. Also, take traffic and accessibility into account when thinking about your employees. If your location is difficult to access, you will have difficulty finding employees and customers who will come to you on a regular basis.
In regard to taking care of the competition, try to be as close to your biggest competitor as possible.
If you are in close quarters with your competitors, you can benefit from their marketing efforts. Odds are that they chose their location because of the demographics in the area. You should still check in on evaluating local demographics, but don’t be afraid to get close to your competition. It shows that you are confident in your product to outsell your competitors.
Assess the space that you’re thinking of buying or leasing.
How old is the building? Is everything up to code? Can it all handle your technological needs? Is the electrical system new enough to handle your expectation? How old is the roof? Is the condition of the building OK for your needs? Aesthetically, does the building fit your company’s taste or style if necessary?
Think about cost and other factors.
Yes, the cost of a location is incredibly important, but don’t forget to look at the situation from a step back. If a location has a very attractive price but is impossible to reach, then your business won’t last very long. If you spend more on a great location, your business will thank you as will your customers. Think about how accessible your location is and if the infrastructure can support all of your needs before signing off on a lease or purchase agreement. And don’t forget to think about hidden costs. It’s rare that you will find a space that is walk-in ready. There will probably be costs for renovation, decorating, IT upgrades, and other important but forgetful things. In addition to upfront costs, don’t forget to research the income tax and sales tax rates for your state and see how that affects your company, as well.
When researching a new location, do your own research and devote a good chunk of time to doing this research. If you rush through this process and end up signing on a location only to find that it’s out of the way in a not-so-nice area, you’ll be kicking yourself until you find a new location. Think clearly and for a long time about a new location and physical spot for your business and you will thank yourself in the future.