Location can make or
break your business. Put your retail store in the middle of
nowhere and chances are you'll hear birds chirping more than the
ringing of your cash register.
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What is an ideal
location? One basic factor every entrepreneur must understand is
that the value of a piece of property depends almost entirely
upon its location. To the retailer, the key to success rests in
the selection of a good location that has a significant amount
of consumer traffic. By contrast, a manufacturer needs to be
located closer to suppliers and modes of transportation.
The selection of a
business location is a factor of compromise. Oftentimes, you
must compromise some ideas for the sake of finances or your
personal preferences. But that's the fun of being an
entrepreneur. You can put your business where you want it, as
long as you can afford the space.
Several different types
of location decisions need to be considered before selecting the
specific area for your new enterprise. Your decision will vary
depending on whether the business is a service or a
manufacturing venture. Consider the following when choosing a
business location:
Taxes.
The differences in state laws on taxation makes some
states more attractive than others. Take the case of Ruth Ellen
Miller, President of NOUVIR, manufacturer of stone-cold and
pure-white fiber optic light. She decided to move her business
to Delaware to escape the high taxes in California. While taxes
are an important factor to consider in locating your business,
there are instances where you may be better off paying higher
taxes and selling more goods for a higher price. Choosing a
location oftentimes is a compromise between tax relief and
potential for profit generation.
Costs.
Shopping malls are oftentimes the best location for a business,
particularly retail and service-oriented businesses. The
trade-off, however, is the high rental price of locating in a
mall. Entrepreneurs may be forced to go where they can afford
the rent or where they can operate more efficiently.
Security.
The quality of the neighborhood also greatly affects the
decision of where to put your business. Many businesses avoid
certain areas of a city because they fear for their safety and
property. Make sure that you check the crime rate of the area.
If an area is notorious, customers might be leery to drive to
these types of locations. Choose a site where you and your
customers will feel both comfortable and secure.
Availability.
Many entrepreneurs locate where there is available space at the
time they wish to open. Expediency does have its virtues, but
consider the long-term effects of your immediate decision. Don't
be shortsighted. Is this the best location for your
business?
Infrastructure.
Sometimes location decisions are based on selecting an area
where there are many business professionals to support
entrepreneurs and serve their continuing needs. For example,
computer businesses often locate in the same area where
materials and parts are readily available.
Personal
considerations.
The location of a business may depend
on how far you want to drive to and from the business each day.
Family commitments may prohibit you from locating in a more
desirable area that requires considerable driving time. Your
personal happiness is an important factor in selecting a
location.
About the Author:
Isabel M. Isidro
is
the editor of Power HomeBiz Guides.
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