Location location location… We’ve all heard the saying before as it pertains to real estate, but what exactly does it mean when you are looking to lease a space for your business? This varies with what type of business you have as well as what you’re looking for to help ensure the success of your business. The right location can mean either the success or failure of a business. Don’t be afraid though, it can be a relatively straight forward process and overall there are five main components you should consider for your retail space.
Demographics. First and foremost you should be looking at the demographics that fit your business. Income, density (number of households), even lifestyle will all be pertinent to finding the right location. When looking at demographics for a neighborhood, you will want to consider what the average income for the area is and does it match your product? Sometimes a higher end income demographic may not be the best choice, especially if your product serves a lower income market. Density, are there enough people that live in the area to support your business, or will your customers have to travel further distances for your product? Lastly, lifestyle. Does your product fit the lifestyle for the community you are serving?
Traffic. The success of your business In addition to demographics you will want to look at traffic. The ability to be seen by as many people, and ease of access are key to the success of your business. How many cars per day go by the location, what are the other neighborhood traffic generators, such as other retailers, office buildings, schools, hospitals, big box retailers or public transit? You will also want to take into consideration foot traffic, what is the walk score for the neighborhood?
Ease of Access and Visibility. Take a look at how easy it is for your customers to visit your store. No one wants to deal with headaches associated with traffic, parking or not knowing how to find you. You will want to consider how many ingress/egress points there are, how many parking spaces are available, who else are you sharing the parking space with and how easily is your business found. Good locations to consider are in high traffic corridors, next to intersections especially those that are signalized.
Competition. Who is your competition and where are they in respect to your business. Major competitors in the area are not necessarily a bad thing. Studies have shown that competition in general is good for all businesses, especially if you’re confident that the quality of your product or service is better than your competition. By being in close proximity to your competitors you will be able to benefit from their marketing efforts as well, after all many of your competitors chose their locations based upon studies they conducted to determine the best location for their business.
Zoning. So you’ve found the perfect space, but now you have to consider how easy it will be to open your business. Most landlords do not guarantee any space is suitable for your specific use. You will want to determine what the current zoning is, if it allows for your use, or if not what you will need to do for the city to make this use work. Conditional Use Permits and Variances can take a long time to get and can be expensive, so plan accordingly.
Finding the right location may seem daunting; after all, this is not what you do, you know how to run your business. Luckily there are many commercial real estate professionals who can assist you in getting the data you need to make an informed decision. Make sure that when you do find one that they specialize in finding spaces like yours, that they are familiar with your business plan, or ask enough questions of you so that they become familiar with it, and can advise you on negotiating the lease and any special costs and timeframes associated with opening your business as it pertains to a specific space.
George Pino is the CEO of Commercial Brokers International. The views expressed here are the author’s own and not that of ALM’s Real Estate Media.