Choosing a business location

Where to locate your new business? The biggest factor in this decision is your industry. For a retail store or other business that depends on foot traffic, a good location is absolutely critical. On the other hand, if you’re starting an IT firm or other business where clients rarely come to your office, the actual location is less important. Here are some options to consider:

Home-based: Starting from home saves money and hassle, but limits your space and growth options. You also need to make sure you aren’t breaking any zoning laws; many municipalities have strict laws regulating home-based entrepreneurship.

Retail: Retail options include space in a shopping mall, a freestanding location, a strip center or a mixed-use facility. For a less expensive option, consider smaller sites such as kiosks in shopping center, spaces in airports, hospitals or hotels; or event venues.

Commercial: Commercial space, which includes office buildings and office parks, are geared to businesses that don’t rely on foot traffic. If you don’t need a large office, one money-saving option is to consider an executive suite--shared office space that provides services such as phones, receptionists, meeting rooms and copiers shared among several small businesses.

Industrial: If you’re starting a manufacturing or distribution company, you will need warehouse or manufacturing space. For most entrepreneurs, a light industrial park will have what you need—space for light manufacturing, plus warehouse and showroom space to store and display your products.

Before you start looking for space, get a firm idea of what you need, what you can live without, and what you can afford. Also consider:

Customers: If your business needs walk-in traffic, assess the demographics of the community to make sure it’s got enough of the type of customer you’re targeting.

Employees: Does the area have a good supply of the type of employee you’ll need? For example, if you start a high-tech company in a location where the labor force is largely blue-collar or unskilled, you’ll have a hard time finding qualified workers.

Competition: Assess the other businesses in the area. You can benefit from proximity to complementary businesses, but you don’t want to be near a direct competitor. For example, you might want to be near other restaurants, but not in the same strip center as another Mexican restaurant.

History: Some locations are, to put it plainly, “jinxed.” Find out the history of the site you’re considering. If three previous restaurants have failed in that location within two years, local customers are likely to pass your new restaurant by, too.

Access: Is the location easy for customers, suppliers and employees to access? Is there room for delivery trucks to unload if needed? Is the site near major highways or public transportation so employees can easily get there? Is the site easy to find and is there enough parking for walk-in customers?

Image: Do you need a formal office, or a more casual atmosphere? Make sure the setting suits your business’s image.

Regulations: Check local zoning laws to make sure they won’t restrict your business unduly, and that undesirable businesses won’t locate next to yours.

Infrastructure: Be sure the location is wired to support your technology need; many older buildings are not. Also find out whether the cost of utilities is included. Does the site provide janitorial services? Do you need to pay for parking? Consider all these expenses.

Expansion plans: Make sure your new location has wiggle room. Setting up a new office is time-consuming; you don’t want to outgrow your space in a year or two.

Take all these factors into account, and you’ll find a location that serves your needs now and as your company grows.