There are a number of location options to consider when choosing a site for your new business. A good place to start is deciding what shopping “atmosphere” will best suit your business.
Here we have listed a number of locations to consider when choosing a commercial site.
Shopping centres and strip malls
Shopping centres are usually large complexes with many different businesses anchored by one or more well-known supermarkets or department stores acting as traffic generators. They are managed by the developer, an estate agent or a professional shopping centre manager. Most shopping centres have merchant associations which are made up of the centre’s tenants, who are responsible for the marketing of the centre.
Shopping centres are the most popular retail outlets for consumers, having become almost a social phenomenon over the last two decades. People of all ages crowd into these centres almost every day, decreasing the need for additional advertising support.
The installation of shop fittings to achieve the image you want to project will probably represent a substantial portion of your capital investment, as in many instances the centre itself only provides concrete walls and floors.
Shop fitting expenses you will have to think about include carpeting and other flooring, counters, insulation, electrical wiring, plumbing, lighting, partitioning, shop fronts, ceilings, painting, security systems, interior design and air conditioning systems.
The main complaint from shopping centre tenants is the high marketing and maintenance fees fixed into their leases. For many small businesses, these expenses consume all the net profit they generate. You should determine the volume your business can reasonably hope to attain and decide whether you can afford the rent at a heavy pedestrian traffic shopping centre.
Suburban Strip Shopping Areas
Strip shopping areas are groups of complementary businesses which are situated in usually high-traffic areas. They usually comprise of the “staple stores” consumers look for in a suburban shopping areas, such as a bakery, supermarket, newsagency, chemist, etc. They will also have other retail businesses to add “value” to the shopping experience. These “value” additions may include, for instance, a florist, fashion shop, etc.
Locating your business in a freestanding building is an option worth considering if a suitable location is available. In a freestanding building you will generally pay less rent and have lower outgoings which decreases your overhead. Also, when negotiating your lease, you may have more bargaining power over a lessor eager to have the building occupied.
In a freestanding building, you are less likely to incur advertising charges, common area fees or have regulated business hours, as is the case in a shopping centre.
What the tenant of a freestanding building loses however, is the joint promotional activity generated in a shopping centre, as well as the additional pedestrian traffic that this generates.
Industrial estates are specialised areas set-up for the key business of industries. It can be a prudent business move to be a part of an industrial estate.
Being in such close proximity to other industry-based businesses could be beneficial to your business through flow-on business and business-to-business trading.
Office accommodation and executive suites
When deciding on an office from which to operate your business, you may want to consider space in a commercial business complex. Office complexes are occupied by several businesses, large and small, and managed by the developer or a professional management company.
The advantage of leasing office space within an office complex is that it lends a look of professionalism to your business. Since you will rely heavily on maintaining professional relationships with your client base, you should present a professional image to them. This is especially important when your dealings are mainly with the corporate sector.
Most corporate managers like to deal with professional organisations. To compete with other companies vying for the same business, you must present your business as competent, professional and of the highest calibre. This takes on greater significance if your clients will be visiting your office on a regular basis.
Another option is an executive suite. This new breed of facility leases office space and provides secretarial services to a number of small, often one-person businesses.
For business people who can’t work from home, but feel they can attract more business if they have a commercial office, this is an excellent start-up facility.
Executive suites provide tenants with short-term leases. Suites usually include a telephone, use of common areas (reception, kitchen conference room), a receptionist and incoming mail reception.
Executive suites also offer a range of support services to their clients, such as fax transmission, photocopying and word processing. Tenants only use these services as needed and pay for them as used, which minimises operating costs.