Business expansion is typically a positive event. The desire to complete such action often means current locations are thriving and the demand for the goods or services the company provides is increasing. That said, designating specific areas ideal for branching out into secondary and tertiary locations can be a daunting task that could have significantly adverse consequences if made incorrectly. When looking to expand to a new location, entities in question should consider the following.
As with any major business decision, the costs of making the move should be carefully considered. Factors such as rent, utilities, taxes, and property maintenance can add up quickly and cut into potential profits. Naturally, cheaper property often comes with issues and sacrifices, so it is important that business owners effectively weigh the pros and cons of each potential property.
Accessibility can over go overlooked, but it is something that business owners should be keen on considering. When brainstorming accessible locations, several factors deserve attention. First, the location should be situated in a central location that potential customers can reach without hassle. This does not merely mean accessible from various well-known roadways but also be easy to reach via public transportation. Moreover, the venue should be relatively easy to get in and out of. Decision makers should ask questions such as “Will this location have suitable parking that can accommodate numerous customers at one time” and “Are there enough pedestrian paths to accommodate those who use this mode of transportation?” Effectively determining the accessibility provided by a given property can help business owners identify which properties are best suited for your business expansion initiative.
Any new location of a business or organization should not be placed near any direct competition. For example, a clothing retailer is strongly advised not to expand into a shopping center that houses one or more tenants providing similar products. Companies should strive to branch out into locations that enable them to enjoy some degree of a geographical monopoly. However, it is not advised that business owners completely avoid areas where there is existing competition; after all, businesses in those areas have likely seen success with a specific pool of clientele, so if your business can compete, such areas are worth considering.
Fitting The Business’s Brand
The ultimate location a business designates for expansion should fit the business’s brand. For example, a trendy clothing boutique would likely be best suited in a large city street or thoroughfare that frequently attracts high end shoppers who are more in tune with the latest fashions. Consider your audience when you are looking to expand. Identify their habits and preferences, and make decisions accordingly.
Most businesses that prosper to the point of expansion place a high priority on the safety and well-being of its customers and clients. For example, placing a bar in a potentially dangerous section of an inner city might provide some degree of geographic monopoly but might not be the most secure environment to ask patrons to frequent. Be sure to acknowledge the needs and desires of your clientele before deciding upon a secondary location. Doing so can help you limit unnecessary anxiety and more effectively draw customers to your business.