Once you’ve settled on franchising as the right entrepreneurial path for you, the next big decision you need to make is deciding on a location to operate from.
It’s a decision that is about more than just geography – your location will affect your visibility and market reach. Picking the right site can be a springboard to franchising success, helping you to bring in new customers and opportunities. On the flipside, the wrong location can leave you facing an uphill struggle once you launch your business.
But how do you pick a site which meets your operational requirements and also resonates with your target audience? In this article, BusinessesForSale.com takes a look at some of the key factors you should take into consideration.
Demographics & target market
Before getting into practical decisions, you should do some brainstorming to figure out what your ideal target audience is, and the demographics of your chosen area. If you’re targeting urban millennials, you might want to choose a location close to a college, while a suburban area might be more appropriate if your target audience is families and retirees. Are you targeting people in high-income areas, or offering a more affordable service? Aligning your target audience with local demographics will give you the best chance of success.
Accessibility
Picking a location close to public transport and parking space is important, as is a site with high levels of overall visibility. If you’re on a busy road, in a shopping mall or another area with high levels of foot traffic, you’ll increase your chances of picking up new customers. A site which is wheelchair accessible will also mean you aren’t limiting who can visit.
Costs
Arguably the most important thing you’ll need to think about when picking a franchise location is cost. As well as rent, don’t forget to factor in the cost of utilities and any renovations needed on the property – a thorough inspection of all corners is essential.
You’ll need to conduct a comprehensive cost-benefit analysis to weigh up these costs against the potential revenue your location can generate. This will help you decide between a prime location with higher levels of footfall and a more affordable site that might require some ingenuity in the marketing department.
Competitors
While it can be easy to get swept up in the logistics of your own launch, don’t forget to factor in your competitors. How nearby are any competing businesses, and do they offer services which conflict with yours? You should also consider competition from new locations under your same franchisor. Check your contract and understand your rights around exclusivity and encroachment. Doing so could help you avoid some nasty surprises further down the road.
Requirements from your franchisor
Your franchisor may have specific requirements for site selection that you need to adhere to. Make sure your chosen location fits all of you and your franchisor’s operational requirements, and that they’ve approved it before you get too excited about starting.
