How to Find the Right Location for Your New Business

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Source: | How to Find the Right Location for Your New Business | Choosing a location for your retail business is one of the most important decisions you will make as a  startup owner. The building you choose will have a big impact on the success of your business. This is why it is important to consider the layout, size, appearance, and location of a property. You also want to think about how it will affect your operations before signing a lease.

Where to Begin?

  • Do a Cash-Flow Analysis 

A cash-flow analysis will help you decide which option would be more viable for your business; do you rent or buy? Why? The cost of a lease on a building will be based on location and size. Before you begin your search, we recommend settling on a sum for your budget. This should be easy if you already have a business plan; in this case, you probably already know the amount you can afford to spend on a mortgage or rent. 

  • Consider Local Taxes

Some locations are more tax-friendly than others. If this is an incentive that you would like to enjoy, then it is something you should consider before settling on a location. Taxes aren’t the same between municipalities. It is a good idea to speak with your commercial real estate agent about this before choosing a place for your business.

  • Separate Your Wants from Your Needs 

You can quickly become overwhelmed with the options and features available to you, especially if you do not make a list of what your business needs in a property and what it can do without. Draw up a list of features to look for and separate them into “must-haves” and “can do without”.

Buildings that do not meet all your must-have requirements should be taken off your list. The goal is to keep this list short. No building will qualify if the list is too long. Then, choose a location based on how well it meets the requirements of the must-have section of your list.

Things to Look out for

  • Accessibility 

Choose a location that your customers can find easily. It is also important that your vendors can easily deliver inventory to you. For example, if you own a furniture store, you will need a mole parking space for trucks.

  • Who are Your Neighbours?

We recommend choosing the right location where you will have complementary, non-competing businesses as neighbours. For example, if you are opening a high-end women’s apparel boutique, having an upscale women’s jewellery store would be a plus because clothing shoppers usually visit several stores in one shopping trip. Please note that the current tenant mix might change at some point; you will want to ask your future landlord about any possible competing stores that might move in before signing the lease.

  • How Ready is it for an Immediate Move?

A lot of retail spaces will require refurbishment. Sometimes, the conversion of ample spaces like garages will need to happen to really suit your business needs. The cost of these modifications can quickly add up and increase the time needed to get the business up and running. To help keep your costs low, you will want to negotiate with landlords and try to get them to share some of these costs. You can also ask for rebates on the rent to offset your initial investment in the property. 

  • Local Zoning Restrictions 

The zoning laws of the location you choose the right location will affect factors like the operating hours of your business, the type of business you can operate on the premises, and how your signage should be done. 

  • What the Rent Covers

Before choosing a location, you will need to inquire about services like trash removal, security, maintenance of common areas, and real estate taxes. It’s important for you to clearly understand your overall costs. Some landlords have the cost of these services included, while others charge a service fee separate from the rent. 

  • Safety 

What type of security does the building have? Is there CCTV? Are there alarm systems in place and security guards on duty? Is the parking lot well-lit at night? 

The security features available in the right location will affect your insurance rates; this means you will want to ask your insurance agent to estimate insurance costs for each location that you are considering.

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