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Choosing a Location for Your Small Business | Small Business Resources

If you’re opening a small business, finding the right location might be the most important “To Do” on your list.
Choosing a Location for Your Small Business | Small Business Resources

Location, location, location

You’ve probably heard the phrase “Location, location, location.” No matter who said it first, it’s still an important rule when choosing a location for your business.

Whether you’re opening a manufacturing plant, restaurant, or retail business with a storefront, finding the right location might be the most important “To Do” on your list. Yes, having tasty food, a needed service, or trendy products is important, but if your customers can’t find you, you’ll have an uphill climb toward profitability.

Factors to consider when choosing a location


Review your business plan and figure out how much you can spend in rent before contacting a commercial realtor. Leasing space is a big expense, so be sure to know your numbers. Be sure to calculate all of the costs that may be involved, including broker, attorney, engineering, and architect fees.


Is the facility located in an area zoned for your type of business? Is it located in a safe neighborhood with a low crime rate? Do you anticipate foot traffic, and if so, is the area walkable with sidewalks and crosswalks? Do you need parking for customers or employees? Is the building easy to get to? Is the area served by public transportation?

Proximity to competitors

There are advantages to being located close to your competitors. You can sometimes benefit from their marketing efforts, increased foot traffic, and more. Understand what businesses are in your area so you can plan accordingly.


Does the building need any repairs? Do the existing utilities meet your needs or will you need to do rewiring or plumbing work? Is ventilation adequate? Does the building have the internet connectivity and electrical power needed for your equipment, computers, and printers? Is exterior lighting adequate to attract evening shoppers and make them feel safe? Will you have room to grow if needed?

Loading and unloading

Do you need space for large trucks to load and offload products? Do you need access to transportation, such as trains or an airport for cargo shipping?


Is the facility large enough for your business? Does it offer room for all the retail, office, storage, or workroom space you need? Do you need a dedicated space for a receptionist or public restrooms?


Learn more about the demographics of your area to be sure that it caters to your target market. Can you find qualified employees in that location? Do your target customers live nearby? Is the population density of the area sufficient for your sales needs? Is the business climate seasonal or year-round? Websites such as the U.S. Census Bureau, City-Data, and ProximityOne can provide useful data about traffic patterns and age, income, and lifestyle characteristics to help you on your search. Also look for “traffic generators” in the area, such as colleges, hospitals, county offices, and other retailers.

Read up

Read the area’s local paper or online publisher to get a sense of the community, including its vibe, government, and economic climate. Are new businesses opening in the area? Does the community match the image you want for your business?

Get help

Negotiating a lease takes business acumen. A good lawyer who can negotiate your lease can review the terms of the lease, buildout allowance, and the condition of the property to make sure your interests are being met—and protected. He or she also can help you interview the landlord. And, a local real estate professional who truly knows the area and its residents can be a valuable ally when it comes to determining trends, traffic patterns, demographics, and market price for real estate.

Thanks for reading our article. Please note that this content is intended for educational purposes only. As laws change regularly, you should refer to your state legislation and/or an advisor for specific legal counsel. See more small business resources or check your workers’ comp rate in 3 minutes.