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How to Choose a Location for a New Business: Factors to Consider

Finding the best premises in the ideal location and at the best prices is an intimidating task. Promotion strategies and prices can always be altered, but signing a retail lease or obtaining a mortgage are long-term contracts and can be difficult to get out of. However, done in the wrong way, you will only end up paying an expensive lease or mortgage for an unsuitable location. If done in the right way, selecting a great location for your business will not only help improve your businesses’ productivity and attract good employees, but will also make sure that you target your market effectively and help you boost profits.

First Things First – Deciding Factors

  • Identify Your Market – Booming food chain outlets like McDonalds can survive and prosper anywhere, in wealthy areas as well as in poor localities. On the other hand, other businesses can only survive in specific areas. The first step to selecting an ideal location is to consider the environment your business will require. Is your business related to convenience, commodities or specialty items? The answers to these questions will help your enterprise survive in the cutthroat world of business. If you are considering starting a service business like an accounting practice, then the best location for you may be your home.
    When deciding, do not just consider the overhead costs, but also consider if working from home suits your product as well as service needs. Assess whether prospective clients might have a problem doing business at your residence – consider whether conducting your business mostly by phone, fax or the web, will keep customers away. There are certain local zoning laws that regulate where a home-based business can be situated, so it is advisable to first verify with your city’s administration before making your move.
  • Collect Data – There are specific online websites that provide useful economic summaries of every urban district in the United States. A general summary or a profile of an economy can help you decide on the perfect location for your business. Profiles provide useful information of whether an economy is profoundly dependent on any industry or sector. This information can be used to determine your customers’ buying trends and needs.
  • Think Like Your Competitors Do – In most cities, large retail outlets are generally located very close to each other. It might not seem to be a wise option to start business alongside your own competition, but this kind of clustering can help increase sales. Joining a cluster can help draw a bigger market and can also help set up your own market in some virgin terrain.

Knowing Your Requirements

Prior to starting your search for the ideal location, always formulate a list of requirements. Some of your requirements should include:

  • Building capacity needed
  • How will the office be structured
  • What are your business- growth plans
  • What are your required meeting facilities
  • Layout and size of the proposed premises
  • Appearance
  • Facilities
  • Parking amenities

Selecting the perfect location for your business is one of the most important steps you will have to undertake. A great location will improve sales and production and will also help attract the right kind of customers. You should take great care when choosing your small business location because the perfect site for your business will lead you down the path to small business success.

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