8 Tips for Finding Your First Business Location
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Owning your business is often filled with numerous triumphs and various challenges. One difficulty all owners face is determining the best location for their company. With so many factors at play — the real estate market, location, financing, and more — it can feel like an intimidating step.
However, careful research can prepare any business owner for their first venture into commercial real estate. Utilize these eight tips to find the right area for your first business location.
1. Research the Area
Before you settle on a region for your business, you’ll want to look at the demographics and compare them against the demographics for your target audience. If the two don’t match, it’s unwise to open your business in a particular area.
Another factor to consider when committing to a location is whether or not there are multiple competitors in the region. Some signs of competition are good – but you don’t want to fight too much for customers.
2. Find What Your Region Is Known For
Silicon Valley is known for its advances in technology, New York for finance, and Paris for fashion. For what is your region known? Play to its advantages when selecting a location for your business. It can help you develop a professional network, find new customers, and even employees.
Additionally, watch if businesses are thriving in your region. That traffic will eventually spill over to your business. Notice, however, that if the business is slow, it might be unwise to invest in this specific region, as it’s unlikely your business will be the sole one to turn the local economy around.
3. Understand How Areas Impact Expenses
Locating your business in a specific state can contribute to your startup costs and overall business expenses. The varying prices that can contribute to your overhead include rentals, property values, utilities, minimum wage laws, and government fees and licenses.
Certain states and local governments even incentivize small business owners with tax credits. If you have the freedom to move your business to another state, strategically plan which one best accommodates your business and make your decision to relocate.
4. Think About Zoning
Another factor to consider when selecting the perfect location for your business is local zoning laws. Most neighborhoods are zoned entirely for one purpose: either residential or commercial. If you choose to base your business out of your home, you could still face zoning restrictions. The best approach is to contact your department of city planning to understand the regulations thoroughly.
5. Consider Costs
Before you purchase or lease your building, you’ll want to look at your budget and see if you can afford the terms. This may seem obvious. However, 52% of commercial real estate agents reported their clients didn’t get financing for their properties. So don’t skip this essential step of checking to see if the property is within your budget – no matter how perfect it may seem.
Additionally, check the lease terms to see what happens if, for some reason, you need to get out unexpectedly. Always feel welcome to negotiate the terms of the lease. Know that the length of the terms is often one of these negotiable factors.
6. Does the Building Fit Your Business?
Another factor to consider when selecting your business location is whether the property matches your overall business style. Do you operate your business with a more casual or formal style? You’ll want a building that reflects that feeling. For instance, if you run a comic book shop, chances are good you don’t want to rent space in an office building for your operation – that would be confusing for your employees and customers.
Carefully think about the current size of your company and project how large you think it will grow. Doing so will help you get a sense of how large a property you should rent or purchase. It’s wise not to get stuck with a building that’s too small or too large for your needs.
7. Look Into the History of Your Building
Before deciding on a property to rent or purchase, do your research. Consult with the property management company if you plan on renting. If possible, talk with previous tenants or neighbors to get honest impressions of the building. Tour the property with someone who knows construction and look at the building’s structure to ensure it won’t require a great deal of work or maintenance to keep up.
8. Parking and Accessibility
When picking out a building, consider the essential factors of having enough parking space for your employees and customers. Depending on where you choose to locate your facility, there may be direct parking lot access or nearby access to a garage. Keep lots well lit to ensure customers and employees feel safe at night.
However, some properties may only have limited on-road parking available, which could limit accessibility, as it makes it more difficult for your employees and customers to park close to your building. Keep this in mind when choosing a site.
Find Your First Business Location
While figuring out the perfect location for your business may be a challenge, it’s not impossible. As you research areas, consider costs and look into potential properties, you’ll get one step closer to finding the right place for your business.
Need a small Business loan for your first business location? Whether you want to upgrade your equipment, hire more staff, or opening a new business location, we can help. You can get access to the necessary funds in just three steps. Check out Capital for Business funding solutions or apply for a business loan today.
Evelyn Long is a writer and editor focused on home building and construction. She is the co-founder of Renovated, a web magazine for the home industry.