Choosing a business location is one of the most important decisions a startup will make. The choice requires solid research and precise planning. Before deciding on a location, talk to building co-tenants or other business owners in the area.
Consider these location factors:
- Exposure: Choose a location that provides ample exposure to your customers.
- Image: Is the location consistent with the image you want to maintain?
- Competition: Are the businesses around you complementary or competing? Which areas are your competitors ignoring?
- Local labor market: Does the area have potential employees with the skills you need or the ability to be trained?
- Your plans for growth: If you anticipate the business will grow, look for a building that has the space you may need.
- Proximity to suppliers: They need to be able to deliver your supplies.
- Safety: Will customers — or employees — feel safe in the building or traveling between their homes and your business?
- Laws and regulations: Local authorities may have rules about what kind of business can operate in specific locations.
Consider financial variables that could affect your business:
- Hidden costs: Very few spaces are business-ready. Include costs like renovation, decorating, information technology system upgrades, etc.
- Taxes: What are the tax rates for your area? Could you pay less in taxes by locating your business in a nearby area?
- Wages: What is the prevailing fair wage rate in your area? You will get the best employees if you offer fair wages.
- Government incentives: Your business type or location can determine whether you qualify for a government business incentive program.
Always consult with a small business specialist or counselor familiar with local circumstances to help you answer any questions you may have about where to launch your business before you make any final decisions.
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Adapted from material published by the U.S. Small Business Administration.