Location Location Location.. Is very important to consider when setting up a business!

We have all watched or heard of the channel 4 TV program, that is all focused on the location of places to live in and the importance of locale. This is very important when setting up a business as well. Always ask yourself if this location going to work for our business goals. With that in mind, we built this article to be an insight in to how location is considered when setting up a business.

Customers and demographic

Many businesses consider what customers they want to reach as a motivator for buying a location to trade at. This is because a business can reach many customers but primarily wants to reach those they know need them. Businesses will consider demographics too, like the average age of the area and marital status. The reason all this matters is simple, a business needs customers. Many customers fit into demographics which makes it easier for businesses to consider where to set up a location to reach customers of that demographic. Take for example a mechanic, whose up-sizing his business by opening a new auto shop. They would likely consider the age of nearby people so as to reach people who are of car owning age. They would also consider being accessible to customers, like how many auto shops operate near industrial estates or close to main roads and highways, this is all done so they can reach their target customers, vehicle owners.

Staffing

Another integral part of location securing for businesses is staffing. Access to talent is a huge and dominant factor for businesses looking to expand. Many businesses try to match their business to the staff they look for, logistics firms operate in industrial estates as they’re more likely to attract clients and employees looking for logistics work. There’s also accommodation factors like if the area has a good ratio of businesses to housing, then the area may be considerable to set up shop in due to a healthy supply of potential talent. The average age in an area will affect staffing choices too, which can prove effective for particular businesses looking to employ from broader demographics.

Using the talent in a local area is another way that businesses consider a location, This is why call centres choose cities or domestic areas, as there is much access to talented individuals, travel has always been a hit or miss for businesses so by ensuring they are situated close to people, they can appeal to a broader demographic of desired talent.

Do others trade in the area?

If your business deals in a niche trade, a question to ask would be, where will your staff come from?

What if your business is too close to another specialist within the same niche? How do you retain staff in an already specialised field. We’ve seen before that niche businesses can thrive in unconventional locations, however this is only achieved due to much rigorous planning and hindsight. If your business is in a niche trade then it is advised that you see what your options are, who is trading nearby and how this can play to your business needs. On the opposite side, many businesses seek competition intentionally, as they know that people prefer choice, businesses can use this to their advantage. Franchisees in America’s Burger King chains often set up branches close to McDonalds, this is due to the guaranteed customer base and a steady supply of staff, often times it will come down to identifying what is in supply and what is in demand, then if your business can supply anything to that area. If no Michelin Restaurant is local or nearby, who will staff your Restaurant if your looking to aim for Michelin, it is worth doing some research before opening up in an area where you aren’t sure what the labour force is like. Ultimately it comes down to balance, the right balance of nearby other businesses bringing a steady stream of people and the balance of potential talent to help run and expand your business.

Transport

Now you’re moving on to identifying transport options that can support your business. After you’ve built an idea for a location, considered potential demographics you could reach and finally know what other businesses are trading locally and nearby, you can consider travel accessibility. It’s advised that a business, where possible, is no less then 3 miles from at least one public transport service. For a business to be accessible it needs nothing more then three simple things. Parking, Public transport and accessibility. If your business demands parking space, then consider what’s best for budget and the business, try and get a balance of paid parking that provides something for the business. This is to allow people peace of mind and security. If parking isn’t needed for your business, consider what public transport is nearby, this will prove useful for any business looking for a new location, as mentioned earlier, being within 3 miles of public transport ensures a business is accessible and considering the nature of traffic, unexpected car maintenance means that future and existing prospects will be grateful for the alternatives.

Suppliers

Once you’ve considered the finer details and if it applies to your business, you will need to consider suppliers you have and how they can reach you. This is a broader area that differs for each business but is essential to a business’ success. In order to know what your options are regarding suppliers, you will have to get in touch with them, see if your new location would cause any changes in scheduling or delivery. In the unfortunate case that a supplier is unable to supply to your location you may have to consider a new supplier, this could present business opportunity for local firms, which could prove useful for building the businesses clients and relations.

It’s not just a case of handling accounts with suppliers though, you may need to consider infrastructure and how it may affect your business. We’ve all seen at least one loading dock or deliveries area in our life that looks like it runs on miracle work and hope. This is an avoidable situation that can be prevented simply by analysing the infrastructure. Check out the age of the buildings and roads in the area, how often their maintained. As it will matter down the line.

Internet access comes under suppliers too, so considering the size of your business and how much online space you use is important also. You can check areas for their Wi-Fi reliability online, many internet providers have maps of their Wi-Fi’s reach, so you can know almost instantly if an area is going to support your business needs.

Will people find you?

Being a business means being visible, but how does a business become visible in a new location? Luckily this is easy to handle and can be achieved early on in the location securing process. Think about your target demographic and what they spend their time doing. If your demographic is online, consider running online presence to attract people, if that’s unavailable for your business, think of physical things you could do to attract people, it may be through branding and logos, or banner advertisements. Ultimately you need to be accessible and people need to know how to find you, by considering the customers you already reach as successes, talk to these people about how they found you, try to replicate that as it’s working for your customers and is making your business be visible.

Being in the right location for the business can make or break a business, so its important to ask yourself the above before you move or open in a location. Sadly 9 out of 10 businesses fail in the 1^st year, this is for many reason. The biggest reason is cash flow however another important reason is the wrong location. Opening a call centre in a remote location with  property prices of £500k+ will not be the right location but opening it near a train station or in a Northern city would be. Looking for the location will be one of the most important things you can do,  always think – location, location, location.

HtE Recruitment News & Insights

This news and insights page has been written by Josh our Marketing Coordinator. HtE Recruitment take no responsibility for this post.