Don’t struggle with the wrong location.
Location, location, location is the mantra for property purchases and it’s equally pertinent for commercial or retail leasing.
What are the major pain points associated with finding and securing a site? Quite simply, getting it wrong. Any franchisee who picks a poor location will struggle to build a solid business.
And choosing the appropriate setting for a business venture is dependent on several factors.
Let’s start with accessibility. How easy is it for your customers to reach you? A business reliant on passing traffic will have quite different needs to an operation that is destination-driven. Typically, food outlets and other retailers thrive on a high footfall, whether that is in a shopping or homemaker centre or a strip location, whereas a tyre service or gym can operate successfully in a less prominent position. Of course both will benefit from high visibility in a highly competitive market.
How will customers actually get to you? It’s important to consider whether customers will drive to the location, and if so, what parking facilities are available. Some franchises will draw customers using public transport so assess how easy it is for them to reach your door.
An easy commute also helps attract staff, and will make your life as a franchisee that bit easier. Don’t forget the demands on your own time: how long will it take you to travel from home to the franchise? Factor in the journey time both ways to get a sense of whether this is a viable option because, in the short term at least, you’ll be working long hours.
Franchisees regularly choose sites that are convenient and in a locale that’s familiar. But what if a great opportunity arises in an unfamiliar suburb?
Consider the neighbourhood: does it have the right demographic for your business? Will your business benefit from a burgeoning population growth as the suburb expands or is there a gradual drift away from the area?
Is the location a great deal because the area is a crime hotspot? It’s important to assess whether or not customers and staff would feel safe both at, and leaving, the location, particularly if the business operates outside 9–5 hours.
Security issues can affect your business and your income, so these are valuable insights.
IF THE PRICE IS RIGHT …
There are plenty of franchisee tales of overspending on a franchise outlet, particularly in retail. It’s a common mistake but paying over the odds does set you back. So considering the costs is crucial.
On top of rent you’ll be paying franchise fees, and possibly wages. Then you’ll be outlaying for business rates and utility bills so if you can, check the costs for comparative businesses. If there is parking but it’s not onsite, will you and your staff have to pay? Factor in these costs.
Looking further afield within the centre, street or suburb, investigate whether there are any upcoming council works, new builds or refurbishments that are going to hinder your trade.
Franchisees can be undone by significant changes to access, even in the short term.
Does the site you’re considering face its own upheaval, with a refurbishment due to keep pace with the landlord’s requirements? How much work needs to be done to the site to get it business-ready?
It’s worthwhile reviewing the competitive landscape too. While fighting a high volume of competitors for market share can be debilitating, having comparable businesses in a neighbourhood can attract customers.
Finally, how long do you plan to be in this location, and what happens at the end of the lease renewal? Be clear on the rules, and the options, before you sign an agreement.