Around 20% of businesses fail in their opening awards and 90% fail within the first five years, leaving a very small success percentage. Additionally, managing your own business is more difficult than ever before due to competition, the digital world and, rising interest rates for sourcing materials and transport costs.
There are a number of factors for why a business may fail but, you have to find why they succeed as well. What can you offer that other businesses do not? This is where it can get difficult.
If you are looking to start your own business, you should consider the factors that can make your business journey difficult. One of those factors is location and if there are many businesses in the area similar to yours, how can you differentiate yourself from others? That is the age-old question that many businesses have.
Why Is Location Important?
There are many factors for why location is important for a business. Firstly, they have to ensure they are attracting the best clients and customers. If your business will solely focus on customers coming into your shop then you will need to ensure that the area you are in gets a lot of people each day. There are many other factors that can also impact this so let’s take a look into them as well.
Other entrepreneurs
In an area that is full of other businesses, your business can thrive. There could be other contacts which they have which can help support your business. Obviously, if there is a business that is similar to yours then that wouldn’t be the case however, other businesses can help each other out.
Along the way, you can start going to business meetups, and offer advice to others and you can also receive advice. These networks can support each other can help your business grow. Not to mention it can also help to reduce your costs of operation.
Hire the best talent
Another core reason for picking the right location is that you need to attract the right people to work for your business. Your business must be able to right employees and to do this, your company must be easy to access. Does your business have a car park? Is it located near a motorway? Is there a train station nearby or is it along a bus route? All of these are questions that you need to ask if you wish to hire the right employees.
City centres are no doubt the best location when it comes to attracting new employees. Additionally, they tend to have a younger population with students finishing university and moving to the big city life. You can even look for those who are seeking an apprenticeship, for those who are getting a qualification but looking to build that experience along the way.
Can attract more/better investors
When you are starting your own business, there are a few things that won’t be possible without the assistance of others. Funding is one of those and to get funding you need investors. Investors will invest in your business after they have seen your business plan and model.
Starting a business is not cheap so you will need all of the assistance you can get to help kickstart your business and that is investors. The better your plan is, the better the investors you will get however, another deciding factor is location. Investors understand whether or not people in your area will visit your company and buy from you. They will only back something that is likely to make a profit so it can make their investment worthwhile.
Consider costs
Just because you are in a great location because it is easy access doesn’t necessarily mean you are in the best spot for receiving resources. If your business is far away from major cities, it can be difficult to receive resources from where you are. The more rural you are, the more difficult it is to receive resources.
Now, this can work on the flip side. The more central you are to a city, the higher the monthly rent will be due to the area it is. It can be an issue for many businesses so they need to find somewhere inbetween. If you are looking for commercial property for sale in Hull, you will notice it can be less expensive than in Leeds. This is another factor that must be carefully considered.
Brand visibility
Another factor for your business is brand visibility. For example, if a business is on a busy road, they are likely to be seen more compared to a business that is located in a rural area. You can also expect a lot more people visiting your business in a city centre rather than in a town/village.
Now, there are plenty of ways that you can advertise your business to ensure that people are aware of your company. Social media is a great way to get your business out there but you should also consider reaching out to newspapers and more specifically, local newspapers. Get them to promote your business through the paper and their social media channels. This is a great way to increase your reputation, no matter where you are. The only issue with this is that it comes at a cost.
When you are located in a city centre, you have those who live in the city coming to your business. You also have those who work in the city coming to your company. The population of a city is typically much greater than a town. For example, Hull would get more visitors than Coniston which is a few miles away.
Room for growth
If you are expecting to grow very quickly, you are going to need to move to a larger location however, there are some towns and villages that can’t cater to that, leading to moving your business to a larger place in a completely different location.
If you move your business from one location to another, you can lose the loyalty of previous customers because you have moved too far away from them. This is something else that must be carefully considered.
To conclude
As you can see, there are many reasons why a business’s location is so important. Not only do you have to think about travelling to and from your premises but it needs to be in an area that can attract new talent. Furthermore, you need to have easy access to resources or else this can be costly as well.
Location is not just about how busy you will be because a good advertising campaign can help to increase that. However, it is more about attracting the right people to work for you and receiving resources at affordable prices. It is also important to scale your business in an area that is in demand.
