Is Location important when starting a new business?
In short, the importance of location cannot be overestimated. It is often crucial to a company’s success
There is a maxim for retail that says the three most important factors are “Location, Location, Location”. At the time it came into being it meant that the shop must be easily accessible to customers, usually on the High Street. With the advent of the internet that is no longer true, even of retail.
“Bricks and mortar” shops still need to observe the maxim, but many shops now offer a combination of ways of reaching the customer such as home delivery and click and collect. So those businesses may need to also consider public transport links, parking, access for delivery vehicles, and warehousing space.
But it may be that the reader asking this question is not considering a retail business, but perhaps a service or manufacturing business.
So the relative importance of location depends entirely on what the business will be and how they are planning to reach clients, staff the business, sell their product and take deliveries etc.
To answer the question, we need to consider the process and the logistics involved. Covid 19 has shown us that not everyone needs to work in the office and that digital communication is extremely important. Technology and virtual communication have caused many businesses to rethink their business model. If you are starting a new business it is the ideal time to consider what will be key to your success.
So you need to think through what you need from your premises -or whether you actually need one at all. If there is to be an office how many people will work there? What will they do?
Or are we talking about a manufacturing plant? Do you need to take delivery of components, store stock and then ship it, meet with customers and or suppliers?
Do you need; –
- Easy access to and from motorways or major routes
- Ease of delivery and dispatch
- manufacturing space
- storage space
- meeting rooms
- Car parking
- What about fast broadband -is that a requirement?
And that is before we consider the cost of different locations! There will be a trade-off between cost and the features you need. This has to be carefully balanced.
Would your business benefit from a prestigious address?
Would it improve efficiency if you were close to suppliers, or to your market?
Is there the potential to increase the business size, or would the location potentially limit growth of the business?
Consider the needs of your employees. Can they easily and cheaply commute to the site, and park. Are there places they can buy lunch, sit comfortably to relax in breaks. If the location is convenient for employees it will help you to attract the best people to the business.
Don’t forget the needs of your customers. Who are they, how will they buy from you? Do they need to visit the location or will they buy online?
So, as I’ve said, you need to think through what you need from your premises -or whether you actually need one at all. Itemise the factors that are important to you, and rank them in order of importance