Location, location, location. You're probably tired of hearing inexperienced realtors repeating this every single time you ask them about which retail business lots they have available.
The truth is that choosing the right retail space for your business is far more complex than simply choosing what seems like the best fit for your budget.
Here are some of the key considerations you need to take into account before signing a lease:
Pricing of Retail Space:
We've seen it countless times—most new business owners base their choice of location on the costs. In the real world, excessively low pricing for a retail space can be a major warning sign that all is not right - there's a reason why the rent is so low.
Conversely, there’s a very good reason why more expensive space you've been avoiding might be the best choice for you. Perhaps, that spot is a prime business location for you. Don’t choose your new place because it’s cheaper than everywhere else. You’ll regret that decision in a few months.
The rental costs of your new business premises should take second place to the amount of pedestrian and vehicle traffic passing by it each day. There's no point in renting an affordable business unit that is invisible to potential customers.
When it comes to "foot fall" figures, don't take somebody's word for it. Instead, you should spend an afternoon or two checking out your new location. Numbers can be skewed, and local circumstances can change. Do your due diligence.
Need ways to simply improve your foot traffic? Check out Vend’s advice.
Be Your Customer:
Some great advice for choosing your retail unit is to think like your customer - put yourself in their shoes and ask yourself where you'd like this business to be located. How much floor space should it have? Is it visible from the road? Once you start thinking like a potential customer, you'll be surprised at just how much this will change your perspective.
Check out all the potential business competitors in your area. If you find competition, don't immediately think that you need to start searching for another location.
Think of this:
If there are two other businesses similar to your own in the area, then you know that not only is there a demand for what they're selling, but also that the local infrastructure supports retail businesses of your size.
Look for retail spaces where your business won't be in direct competition with others but will instead compliment them. The one exception to the "competition is good" rule is if there are multiple "big discount" stores situated nearby. Their presence usually means that families in the area don't have a lot of disposable income.
Never make any assumptions about what you'll be permitted to do within your retail premises. Business and zoning laws can prevent you from opening during specific hours of the day. Imagine if your business was prevented from placing signage on their exterior of their retail space because of a local law. Don’t be shocked, read the fine print!
If you have concerns, visit The U.S. Small Business Administration page.
You should also check for any planned constructions projects taking places near your new business. Rerouting streets or citywide projects could hurt your new business.
You might be patting yourself on the back because you've just found an ideal location for your retail business, but what if your employees can't be sourced locally? What if they simply aren't willing to commute for an hour or more each day to work for you? Check the demographics for the location you're interested in. Think like a future employee would - how do I get there? Are there buses? Is there parking nearby? What will my travel expenses be each month?
It's Not A Race:
Rushing to choose a location is the best way to make the kind of financial mistake your business may not be able to recover from. Being an eager entrepreneur is admirable, but it’s better to delay launching your new retail business until you find a location that makes sense.
Starting a new retail business requires a significant investment of time, money and effort, so it’s worth taking the time to get it right. The tips we’ve provided in today’s blog post will help you make better decisions for you and your business.