Securing the right retail location is one of the most important decisions you’ll make for your business. Your choice impacts everything from customer footfall to profitability. So, how do you find the perfect spot? Check out these six things to think about when choosing a new retail location.
1. Your Target Customers
The first step in choosing a retail location is understanding your customer base. Who are they, and where do they spend their time? Your location must align with their behaviors. For instance, if you’re targeting an urban millennial crowd, a spot in a bustling city center or trendy neighborhood may serve you best. Conversely, proximity to suburban residential areas or established community hubs could be ideal for a family-oriented brand.
Demographics and psychographics play key roles here. Use local data to assess median income, age groups, and typical spending habits in prospective areas.
2. Foot Traffic and Accessibility
Foot traffic is the lifeblood of many retail businesses. High-traffic areas like shopping districts or well-frequented plazas can keep your business visible and attract passing customers. But quantity isn’t the only factor. Think about the type of people frequenting the area. Are they likely to match your target demographic?
Accessibility is also vital. Ensuring that your store is easy to reach by public transport or provides ample parking enhances the shopping experience and increases customer retention.
3. Nearby Competition
While competition drives innovation and growth, too much of it could dilute your market share. Identify neighborhood competitors, and analyze customer traffic, product offerings, and pricing. And remember, having competitors isn’t inherently bad. For instance, a bakery near a coffee shop can increase mutual footfall due to complementary offerings.
4. Security
Pay particular attention to security needs for high-value retail. Is the property well lit? Are there bollards or barriers around the perimeter to prevent vehicle break-ins? A good property manager understands how bollards increase security for commercial buildings. There should also be security cameras in place. In general, a well-secured property reduces the risk of theft and vandalism, which can be costly for retailers.
5. Costs Beyond Rent
Rent is only part of the financial equation when considering a new retail location. Other operational expenses can include utilities, maintenance fees, property tax, or even higher insurance premiums in high-traffic zones. Additionally, some locations might require costly renovations or upgrades to make the space functional or reflective of your brand identity.
6. The Building’s History
When choosing a retail location, don’t just look at the present; consider the past as well. Research the history of the building and the surrounding area to better understand its potential challenges or advantages. For example, if the building is in a flood-prone area or has a history of structural issues, you should consider these factors before making a final decision.
Finding the right retail space involves thoughtful consideration of customer profiles, operational feasibility, and community engagement. By thinking about these things when choosing a new retail location, you can find a spot that sets your business up for sustained growth.