The geographical location of the company in a specific locality, municipality, area or region is a strategic decision. Said decision will depend on certain factors that may favor or harm the present and future economic activity of the company.
When choosing the specific location of the premises we must take into account the surface, its distribution in plant, its cost and form of acquisition (rent, purchase, leasing), the regulations that may affect it, as well as possibilities for future expansion. If you are looking for office spaces in UK then take a look at Pall Mall Estates. They are a leading UK provider of commercial property rentals with flexible terms.
Location in a population
The first decision that must be taken to choose the most suitable location for a business is to determine the population where it will be located, for which it is necessary to carry out a detailed study of some factors, among which are:
The proximity to the market and customers, the distance to the areas of influence such as commercial areas, the density of the population, the population pyramid by age, the income level of the residents as well as the level of education or training.
Provision of services and industrial area, water supply, electricity and telephone, as well as the necessary infrastructure for the type of company to be implemented.
The possibilities of access to raw materials and buyers, proximity to suppliers as it facilitates and reduces the costs of provisioning derived from transport.
The unemployment rate, availability of skilled labor, as well as the possibilities of subcontracting.
The economic and tax incentives , the subsidies and incentives from the Administration for creating businesses in the municipality.
Choice of neighborhood or area
After having determined the city, we must choose the neighborhood where we will locate the company. For what will be necessary to study certain aspects such as the intensity of competition and number of competitors.
In addition, we must assess other factors such as the possible responses or reactions of competitors before the entry of a new business, as well as the business strategies developed by the establishments in the area. That is to say, to value if it is competed via prices or via differentiation and to verify that the strategy of our company fits and can face these.
The most appropriate location
At the moment of determining the specific location of the trade, within the city and the chosen neighborhood, the first thing that we must select is the type of location that we want among the three existing options: Isolated local, commercial area or commercial center. In addition, we must analyze factors related to the premises such as:
– Local available, as well as number of parking spaces, visibility, pleasant architecture and good lighting since all will determine the ability to attract attention to the trade.
– Cost, surface and structure of the establishment, cost of conditioning for the start-up of the business, and communications, infrastructures, width of the road and sidewalk, soil conditions, if it is a garden area, etc.
– Pedestrian traffic, since the more busy the street where the place is, the more likely the business will be visited.
– For consumers to be able to buy, it is necessary that they have the possibility of traveling to the store, so public transport is a positive factor. The different possibilities must be studied (bus, taxi, etc.).
-Road traffic, state of the roads, the existence or not of traffic jams, if it is a one-way street, the different access roads, etc…
– Urban legislation.
– Number of competitors in the vicinity. The more competitors there are in an area, the tougher the competition will be and the lower the margins will be.
– Number of non-competing stores. The more stores there are in the vicinity, the more buyers will approach increasing the probability of selling the business.