Choosing a Location for Your Store

The choice of your retail location can mean the life or death of your business. Many different factors need to be considered before you commit yourself to a location. If you are in a business-to-business market, mail order business or commercial operation—your location may not seek heavy foot traffic. However, if you are in a retail business, visibility, easy access and community presence are important. Consider the following questions as you ask yourself what do you need for a location that will bring more business to your doors?

• Define the type of retail business you want to operate. What sort of business do you want and what target market do you intend to appeal to? Unless you have these basic questions answered in your mind, you will not be able to make a solid decision about the appropriate location for generating revenue for the business.
  
  
• Obtain location demographics. You can visit your local library, chamber of commerce or city hall to gather information about the neighborhood demographics, such as population level, age and income. You can also obtain this type of information from the Census Bureau; visit their web site at http://www.census.gov or call the customer service line at (301) 457-4100 to order reports that interest you—you may be charged a fee for reports.
  
  
• Is your potential location and store compatible with other stores already in the area? Neighborhood business can help your store or hurt it. You’ve got to understand what types of businesses generally cluster together and which are incompatible. Auto dealers tend to cluster and generate traffic for one another. A good restaurant in a small shopping center may generate more visitors for other stores. However, an upscale boutique may not fare well next to a super store or discounter.

After you evaluate the above questions, you will move on to detail questions that help you move from selecting a desirable location and building to working out the details that make the decision a reasonable business arrangement. It is important that the building itself provides the conveniences you need including parking, lighting and delivery access. You want to have preliminary meetings with the landlord, you may be dealing with a large leasing company or an owner-leasor. Find out how accessible the landlord or building manager will be for repairs, concerns and routine maintenance. Landlord and tenant responsibilities should be reflected in the lease.

Is the lease right for you? The lease should reflect the length of time you expect to be at a particular location and provide an escape clause, as well as a clause for continuing the lease. Cover all the bases before you put pen to paper and commit to a lease. Be sure that your attorney carefully reviews and comments on the lease agreement before you sign this legally binding document. The lease should spell out who pays for insurance, if you can sub-lease and any site improvements to be made before you move into the space.

There are many factors to be considered when choosing your store’s location. To review your options and evaluate the aspects of your ideal business site vs. the real-world sites available, seek outside advice. The SCORE Association (Service Corps of Retired Executives) provides free and confidential business counseling in our community. More than 12,000 working and retired business owners, executives and managers donate their business expertise to assist entrepreneurs. SCORE has assisted more than 3.5 million small business owners. Call 1 (800) 634-0245 for a referral to the SCORE chapter nearest you.

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