And it is not for less, since the success or failure of a business in a lot it has to do with the adequate selection and location of the premises for it. Today I share with you at least 10 tips that you cannot ignore to make the smartest decision.
Tips for Choosing the Commercial Place for your Business
1. When should I think about a commercial premises?
The first thing to consider is that not all businesses need a location or office, at least at the beginning. And in fact depending on the type of business you do, you can consider the possibility of using your house, your garage or a space that a family member or acquaintance offers you for a symbolic rent.
The rent of a premises should be considered only when you have some savings to cover the assembly costs and when your business has enough structure to be able to open its doors and sustain the pressure of generating sales.
Of course, there are some types of businesses where having a formal location is imperative, for them, the following tips are essential.
2. Buy or rent a place?
Although it may seem obvious, the answer to this question for every entrepreneur is to start by renting a premises, as this will allow you to minimize risk while your business grows enough to expand and then consider buying your own premises. Renting a premises also allows you to know your business and your market while gradually growing.
3. What are the advantages of renting a place?
The main and most important when renting a premises is that you work with temporary contracts (regularly for terms of 1 or 2 years) which allows you to evaluate if the premises provide you with the benefits you expect in terms of location, size and costs and in case If you need to, make the changes that are required.
4. How much should be paid for a rent?
This is an important question, but the best way to answer it is through a budget. Not all businesses are the same, nor do they have the same costs or the same profits. An overpaid rent can easily eat up your profits and wipe out your business.
Although the rental costs are usually high, we could say that a good reference measure to calculate the investment in premises should not exceed 30% of the monthly operating budget of your company.
5. What is a good location for my store?
The proper location of the premises can make the difference between many clients or few clients. This applies especially to the types of businesses where the customer looks for your store or is attracted by the presentation and image of your business. Some other important factors to consider are: ease of access from a vehicle, available parking, security and above all that you are located in the economically correct sector.
6. What other costs should I consider?
The basic costs to consider when renting your premises and which are important variable costs to be budgeted are: the costs of the contract, the adequacy of the premises, telephone lines, Internet, transfers, etc.
You must also make sure in advance how much the fixed costs of monthly services such as electricity, water, surveillance, alarms, maintenance, etc.
7. Is it better to locate my premises in a shopping center or in a popular neighborhood?
This must be evaluated in relation to cost benefit. Placing yourself in an attractive shopping center can mean higher sales but also higher costs. While placing your business in your neighborhood can be cheaper but it could also mean fewer sales.
In addition, shopping centers are usually much stricter in terms of hiring, hours, holidays and other conditions that you should carefully evaluate.
8. How do I know if I will have clients?
This question in itself represents a broad marketing topic. But simplifying, I would say: if you were going to sell soccer balls, would you offer them on a skating rink? Of course not !!
Soccer balls must be marketed in soccer stadiums, centers and academies. Knowing if your business will have customers and even more, if they will be the desired customers is a subject that requires much more than a simple yes or no. You must analyze, do a basic market study and promotional work that can be low cost.
9. Should I find a corner?
Choosing a good business premises has to do with various factors. Corners for example are excellent locations to place businesses because they regularly have excellent visibility. Whether in shopping malls or popular commercial areas, being strategically located can make a difference in profits.
10. How much competition is there in this area?
Being close to your competition can be a double-edged sword. It can pressure you to use a volume strategy for low prices, which can seriously affect your profits or it can be a benefit because you consider that your competitors have already created a market that can easily be attracted if you offer better products, attention and price.
However, it is something that must be carefully considered so as not to lose in the play.
Finally, some additional little tips but no less important when choosing the commercial premises for your business are:
- Try to be punctual and comply with your income. The accumulation of debt for rent can become a rampant and undesirable burden that you will not want for the health of your business.
- Try to locate yourself close to where there are other businesses that generate traffic. For example supermarkets, banks, schools, pharmacies, factories or hospitals. The union helps to commercially develop the area and your business will provide important value for other businesses in the sector.
- The venue is not everything. Remember that once you are well located, you must work hard to develop the image of your company, a marketing and promotion strategy to attract customers to your business and keep them coming back.
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