Growing a company is an exciting time. If you’re ready to expand, you’ll most likely want to pull a working group together and get out there to find a new site – but when was the last time you took a step back and thought about what makes a good business location?
At Newgrove, we’re experts in location intelligence and have been for more than 25 years. To help you with your next move, we’ve found there are seven key factors to consider when choosing a business location:
1. Study the population
Are the people in the area you’re looking to expand into your ideal clients or customers? This may sound like an obvious one, but it can be easily overlooked.
By comparing consumer classification data and your customer analytics, you can see whether any potential location for your company is likely to be a hit or miss with people living and working in the area.
2. Local demographics
Another factor to consider is the demographics that sit underneath the population of a place. This includes age, employment, education, income, race, gender, homeownership, and marital status.
We all buy different goods, products, and services, depending on our circumstances. Therefore, understanding the demographics of an area enables you to discern what factors are driving local people to spend their money. From there, you can see if consumers are a fit for your brand and whether your chosen plot is a good location for business or not.
As Investopedia puts it: “Segmenting a population by using demographics allows companies to determine the size of a potential market. The use of demographics helps determine whether its products and services are being targeted to that company’s most influential consumers.”
3. Proximity to other businesses
Being close to other firms could do you a favour when you’re opening a new company location. If there is already a busy high street, popular out-of-town retail outlet, or an up-and-coming industrial site, opting for a property in one of these spots may be advantageous. While the other businesses in the area don’t always need to be within your niche, simply having more people gravitating to an area could mean more business when you do open.
There might also be a bit of buzz around the new company coming soon, which could easily draw in new customers in your first few weeks. Putting up posters and leafleting about your opening day is also a good way to entice buyers in.
Did you know we’ve mapped out and scored over 6,000 retail locations? We’ve classified them into 11 categories based on their size, geography, and function via our leading location intelligence software, Periscope®. This allows you to find the total number of retail units in an area and evaluate businesses nearby.
4. Find your competition
Do you know how many competitors are close to your proposed premises and where they’re situated? Looking at where your competition is can help you see whether consumers are already catered for by several businesses or if there are any gaps in the market. It also allows you to see how other companies measure up against your offering, so you can showcase your USPs to prospective customers.
Depending on the nature of your business, being close to a competitor could prove to be a goldmine or a financial disaster. Knowing where your competitors are located allows you to make an informed decision about whether a site is right for your business.
5. Look for complementary businesses
One instance where it pays to be close to the competition is if you’re a product or goods-based firm. Opening a new store or outlet near a business or businesses with an offering that complements yours can be a clever tactic because even the most loyal customers may think that the grass is greener on the other side (i.e., with your company).
Therefore, by giving them a choice and allowing them to check out all their options before making a purchase, you could benefit from shoppers visiting your premises. For example, you often find sofa stores next to one another to give homeowners and renters a selection of comfortable and stylish seats to choose from.
6. Public transport
Accessibility to a site is a big factor to consider. You want to know that your customers and staff can get there. It can be easy to automatically focus on whether people can drive to a location; however, it’s worth thinking about patrons and employees being able to access your premises by several modes of transport.
The latest research from the National Travel Survey: England, shows that 20% of adults aged over 17 in England don’t have a driving license. Therefore, an area with strong public transport avenues could be beneficial for your business. Having an accessible spot could lead to higher footfall and, ultimately, more sales.
To make it easy, Periscope® enables you to determine local transport links and consumer drive times, so you can pick a plot that most people can reach.
7. The X-Factor
No, we’re not talking about the ITV show. What is the thing that is going to draw tourists in or where do locals congregate? It could be a river, a historical building, a new attraction or simply a huge, spacious car park where lots of shoppers can park.
Claiming a piece of land near an area’s X-Factor could prove to be the perfect place to expand, as there is likely to be a higher volume of ‘traffic’.
Finding a new site can take months, let alone fitting it out, stocking it, and unveiling it to the public at the grand opening. Location intelligence can take away the headache of trying to locate the best spot. In a matter of minutes, you can find the most lucrative locations in your local area or sites across the UK that are likely to be profitable.