So you’ve taken the herculean decision to branch out of employment and into self employment. First of all congratulations on this leap of faith, it’s going to be an arduous but potentially highly rewarding task. But before you make any swift decisions regarding your business, one of the most important things to consider, and what will determine a large part in your future business trajectory is the location. Get this right and you can potentially compete with the best of them, get it wrong and your start-up may never get up off the ground.
Some tips to help guide your business location decision process:
Research
Do your research, conduct thorough market research into the behavior and motivations of your target audience. You will need to understand them as much as possible in your attempt to convince them to buy your products/services.
Demographics
Some areas are famed for their student culture, others for their retirement aged demographics. Know your customers, if they are young, trendy professionals perhaps a city centre location would suit, if they are a more mature target audience perhaps a location which displays higher figures of people over a certain age would be more beneficial to your future business figures.
Suppliers
Can you access the suppliers you want in your chosen location? Plus, is it easy for them to get to you? There is no point being tucked away where suppliers cannot deliver.
Competition
What other businesses surround you? Are you situated in a highly competitive area with competitors at every turn? Locate too close to competition and it makes it easier for customers to switch and could encourage price wars. Too close to a well established competitor and it will be hard to persuade people to change but it is advisable to be in the vicinity so you have access to relevant footfall.
Budget
Unfortunately you cannot get away from the fact that where you can locate your business will be governed by the budget you have to spend on property. So get the best bang for your buck – Consider facilities and future expansion as well as exact location.
Environment
Different locations will be governed by different councils and regulations. Some may be more generous and nurturing to local start up businesses whilst others may offers may offer little to no help at all. If you are less experienced and reliant on supportive services ensure you do your research into what is on offer to you which may help your business get off the ground.
Post code power
If you are a service provider such as an accountants or consultancy your business may benefit from some postcode power. This is where you new business stands to gain legitimacy from being in a more prestigious post code. People tend to trust businesses form well known or prestigious post codes in more affluent areas. The wrong post code could put potential customers off before they have even come into contact with you, you may be offering a superior service but if you cannot gain their trust you will find it hard to get off the ground.
Identifying the right location for your business is a balancing act. You must balance visibility to your potential target audience, which will inevitably come with a higher price tag, with anticipated revenue, all within your budget.
If your business relies on footfall your location is very important, perhaps even the most important consideration for your business. Cafes, retailers etc all rely on footfall. As a new business start-up you will not have any sort of reputation so people will not be willing to travel to find you. If you are not visible in the right location you are not going to generate any sort of revenue to rave about.
Follow these golden rules when deciding upon the ideal location for your start-up business, and then once you’re settled in, all the hard work will begin!
Photo Credit: Flickr/Hotel Concorde Berlin
