As any realtor will tell you, it’s all about location, location, location! As hard as you may work, as flawless as your online presence may be and as beloved as you are by your loyal clientele, being in the wrong location can seriously hamper your business’ growth. When starting up a business it’s important to begin on the right foot and while fledgling entrepreneurs tend to obsess over the infrastructure of their business in terms of their tech, marketing and online presence, location tends to take a back seat. This is understandable. In real estate, beggars can’t be choosers and with many leaseholders unwilling to let their premises to startup businesses a lot of nascent business owners have to make the best of what they have.
While a great many factors play a part in the success or failure of a startup, entrepreneurs underestimate the importance of location at their peril. Even when options are limited, business owners should have certain requirements that they expect of a premises.
Why is location important?
For retailers whose income is dependent on footfall then the importance of location is obvious. Retailers are dependent on at least a modicum of passing trade which can be impeded by a premises that is in an undesirable area or off of the beaten track. While footfall can be supplemented somewhat by a comprehensive marketing strategy, location plays a part in the efficacy of any business. Non-customer facing businesses requiring office space should consider the location of their premises if only because an inaccessible location is likely to result in late employees or an unwillingness of potentially important clients to visit.
While all startups dream of swanky city centre office space with an on-site concierge and high end catering facilities, these may come with sizeable overheads (such as building maintenance fees) that could be crippling to businesses even if they can afford the rent. Hence, many office based businesses downsize into less lavish premises to save on overheads while sole traders may eschew their more modest offices for hot desking or even working from home.
Whether you’re looking for your first physical premises, or looking to move to accommodate business growth or reduce unnecessary overheads there are some key considerations when it comes to choosing a new premises.
If moving to a new location will result in more foot traffic that will result in growth and prosperity for your business, then chances are a move will be beneficial despite the cost. That said, it would be irresponsible not to carefully consider the cost of a move. Business owners must be cognizant of the ways in which a move can impact on daily operations, human resources and cash flow. Moving to a new premises is often a costly enterprise with many landlords and letting agents requiring not only a sizeable down payment but 3-6 months’ rent upfront. New businesses should bear this cost in their cashflow projections when applying for startup funding but for existing businesses a working capital loan may help to take the sting off the move and limit its disruption on your operations. These short term, unsecured loans are often used by businesses in times of poor cash flow and they can be ideal for facilitating a move while still ensuring that employees get paid and that the business can operate as normal for as long as possible.
Size and layout
When considering a move, it’s important to meticulously study the floor plan in order to ascertain how it will affect your layout. Of course you will need the space to accommodate your equipment and ensure that it can be used comfortably and optimally in the space. Traditional logic dictates that a move to a bigger premises will result in a more flexible working environment, but in some cases the layout of the building might actually impede productivity despite the extra space. Additional walls or the shape of your new premises may necessitate a very different working space to that which you currently inhabit. You may need to shuffle teams and departments around to make collaboration between different individuals and departments easier.
The best way to limit the layout’s impinging on your employees’ productivity is to democratize the process, involving everyone in the conversation of how best to use the space so that people and departments who need quick and easy access to each other can be placed accordingly.
Parking is an important factor both for both customers and employees. Ideally, your premises should have or be within easy reach of ample parking. Customers are likely to be put off by a premises that they will not be able to immediately access by car and businesses court employee lateness if employees have to spend a considerable time driving around looking for somewhere to park.
Security is a huge consideration from wire mesh fencing to CCTV. The type and measure of security you have will depend on your business but it’s important to ascertain whether your new building will have its own security provision, or whether this be an additional overhead?
You may have security staff on site who come as part of the package for your building or you may need to subcontract your own. Your tenancy agreement may be permissive of installing CCTV cameras, fencing, window bars or any other anti-theft measures, but it also may not. Whether you’ll have the infrastructure to protect your stock, tech and equipment (as well protecting your staff) is a huge consideration, but you should also consider the premises’ digital security. Premises using a shared Wifi network, for example, can be a potential security risk that could compromise your business’ data and that of your employees and clients.
Customer facing businesses need to be eminently accessible for a range of customers, some of whom may have mobility issues of use of a wheelchair. Clients and customers need to feel secure and safe as well as being able to access the premises easily and with a minimum of extra provision. Wheelchair dependent employees of course must also be catered for and even businesses that are not customer facing should seriously consider wheelchair accessibility. A visit from an important client, guest or business contact can easily turn sour if they are unable to access the premises due to mobility issues.
How do I know it’s time to move?
This depends very much on your business, but if your current premises is in any way lacking in any of the above areas, and you have provision in place to cover the costs, you’re selling your business short if you remain in the wrong location.