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How to Choose the Right Location for Your Business

business-locationEvery entrepreneur has heard that choosing the right location is extremely important. But there are so many items on the to-do list of anyone starting a new business, that scouting out the perfect location can sometimes slip through the cracks. For many small businesses, not letting that happen is crucial.

So, what should small-business owners consider when choosing a location?

Is It a Good Fit for Your Customers?

For small-business owners whose customers come to them, the effects of location on clientele are a chief concern. They must choose a location consistent with the brand image they are attempting to present. An industrial area might clash with the image of a wine shop, but might be the perfect place for a retailer of heavy-duty work-wear.

It’s not all about image, though. A business’s location should also be in an area that members of its target market are likely to frequent. Opening a high-end restaurant in an economically depressed area would probably make staying in business an uphill battle. The same goes for opening a video arcade in a retirement community.

Making it easy for clients to get to and from a business is also an important consideration. For example, businesses catering to teenagers will probably benefit from locating near stores where parents are likely to shop, and by making sure they’re easy to reach by cycling, walking, or taking mass-transit from nearby schools or residential areas.

There’s Safety in Numbers

Many small-business owners choose to locate their enterprises near other similar businesses. One might think that having so much competition nearby would be detrimental, but the opposite is often the case. In locating near other similar businesses, business owners can “piggyback” on the marketing efforts of their competitors, benefiting from the increased traffic in the area.

Does It Fit Your Budget?

If money were no object, many business owners would choose different locations than the ones they currently occupy. Obviously, budget is going to be a concern for most. For businesses that tend to visit their customers out in the field, the image that a location projects is irrelevant. As long as it’s relatively close to clients and suppliers, erring on the side of affordability is probably a safe bet.

But for retailers, restaurants, and other businesses whose customers come to them, it may be worth investing in a higher traffic location if the increased business is likely to pay for the difference.

It’s also important to remember that a location may need to be altered in order to accommodate a new business. Business owners must figure these extras into their cost analyses. Will the space need decorating? Remodeling? Infrastructure upgrades? If so, there’s a strong chance that these costs will be shouldered by the business owner, and not the lessor.


John R. Klaras is a serial entrepreneur and small business professional, a writer, and an educator by trade. With nearly a decade of experience in the telecommunications industry, he is currently in the process of building a burgeoning new microbusiness. He has written for leading companies in a wide variety of verticals, including travel, finance, motorsports, and real estate.