Picking a good location for your business?

There are things to know that will make it easier to find just the right place for your business, even though the most experienced business owners can make the mistake of being at the wrong place at the wrong time.

Many business development experts say the location of a business is very important to its survival and success.

According to them, it is therefore very important that entrepreneurs avoid rushing the decision about where their ventures will be located. However, many business owners fail to take appropriate steps before settling for a location for their business.

Many of them fail to realise that such things as the safety of the location and taxes they have to pay in a location matter. Some others settle for the cheapest space available, ignoring the fact that the nature of their business ought to be taken into consideration as well.

It is true that cost and the type of space you need also matter, as do your potential customers. The point is that instead of considering just one or two of these factors, entrepreneurs should strive to take as many of them as possible into consideration in order to get the best possible location for their business.

Nature of your business/product

As explained briefly above, the type of business you intend to do matters when it comes to choosing a location. For instance, if you want to establish a poultry business, a shopping mall is not an option for you in terms of location. So, to get the ideal location, consider the type of business you want to do. Is it one that can be home-based? If it is a retail business, there are a variety of options when it comes to location – from shopping malls to hotels, and airports or filling stations, etc. It could be a mobile business, in which case where the main office is located does not matter much. Rather, care must be taken to ensure that the vehicle used for the business is in good shape and suited for the business. As with the example of the poultry business above, if an entrepreneur wants to go into manufacturing, then an ideal location should be an industrial estate, not some residential neighbourhood where a company, especially one that produces such things as batteries, may cause harm.

If you intend to sell a product or provide a service which involves you dealing with customers regularly, then it is important that your business is located in a busy area. If you want to open a restaurant, for instance, a densely populated area may be best for you.

Your customers

Who are your potential customers? Where do they stay or work? This is a very important factor to consider. Your business is meant to be close to your customers. If you are too far away from them, they may be deterred from patronising your business because of the stress they have to go through to do so. So, know your target customer and keep the business close to them.

Ease of access

This is an extension of the previous tips. For your business to be easily noticed and patronised, which is important if it is to succeed, it has to be visible. This means people (customers) should be able to access it easily. So, how accessible is the location you are looking at? Is it going to be visible to your target customers? For example, a funeral home may be better off if it is located close to a hospital as this makes it visible to those who may need it.

Safety of the location

Safety is another important factor when it comes to locating your business. If you locate your business in an area that has very high crime rate or is known as a hot spot for violence, it is unlikely to attract the kind of patronage that will help the business to grow. Also, your business could become a target for robbers and vandals. Many businesses have suffered losses due to robbery and violence and a number of them did not survive. There had been instances where car dealerships lost all the cars they put on display to violence. So, in choosing a location, ensure that you take the level of violence and crime in the area into consideration. A little research via the Internet may be enough.

Financial costs

Sometimes, different locations have different laws and taxes for businesses. It is important to take this into consideration. Some states have established free-trade zones, while others are working on that. Some have higher taxes than others. In essence, the business environment in one location may differ from that of another location. So, take note of which is best for your business in terms of costs.

Other financial costs may include hidden charges for a location. The fact that the rent for one location is less than that of another should not be all that is taken into consideration. This is because some locations require upgrade and that could lead to charges that in essence make the rent double what it was thought to cost, while others require little or no upgrade. It is therefore important to take that into consideration as well as taxes and other government incentives that may apply to the location.

Location of your competitors

According to experts, businesses that ignore or take their competitors for granted are likely to fail. This is because they fail to position themselves to compete favourably or to seize control of the larger market share. This can be achieved when you take note of the location of your competitors, their customers and offer them better quality or lower prices. Without knowing where they are, you are unlikely to achieve that.

Experts say choosing a location for a business can be very complex, as is the case with other aspects of establishing a business. This is why it is important that you take your time and ensure that you get it right. By taking these factors into consideration, you may be able to avoid the mistakes that many entrepreneurs have made in choosing a location for their business.