How To Choose A Good Location For Your Business And Its Importance

Knowing your customers is a key factor in choosing the right location. If you are opening a business that can only draw its customers from the immediate area, and you are catering to an upscale market, you will not want to locate your business in a middle or low-income neighborhood.


One of the most important considerations of a good location for a commercial enterprise is the composition of the surrounding community. Some communities are great for retail operations but totally inappropriate for industrial use.

Business owners and managers should always perform due diligence including a study of the community’s demographics before deciding on a location.

Related article: How To Write A Business Plan That Attracts Loan

Factors you need to consider when choosing the best location:

**Costs = 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.

**Availability = many entrepreneurs locate where there is available space at the time when they are planning to open.

**Infrastructure = sometimes location decisions are based on selecting an area where there are many business professionals to support entrepreneurs

**Personal considerations = the location of a business may depend on how far you want to drive each day

**Taxes = choosing a location oftentimes is a compromise between tax relief and potential for profit generation.


 Ask the following questions when looking for the best location for your business:

1. Is the area zoned for the type business you want to open?

2. Will you be able to establish a good working relationship with the landlord?

3. Is the neighborhood safe?

4. Is the facility itself in good condition? Will repair work be necessary?

5. Does the facility have the right layout? If you need to expand, will you be able to?

6. Will there be enough parking for your customers? Is public transportation nearby?

7. Are there any local business organizations that will help with marketing?


Knowing your primary location needs is critical to making the correct decision. Too often, business owners like the space and price and make bad decisions for the operation. Retail operations need visibility, parking, etc. Office space needs parking, food service and areas for walking and jogging. Distribution centres need easy access to highways, rail and plane transportation


Every business type needs certain core amenities. Do not compromise on these needs. You always have to make some choices but stay true to your core requirements. If you do, your location selection will serve you, your customers and employees the right way, the most profitable way.


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