The Best Business Location
The Making Business Fun Podcast, Episode #103
Location, Episode 103
This is where business gets fun. Up to now — yes, some drudgery. But now, it gets real.
Take pleasure in physically creating your business. Making it fun!
Find the right location
Some businesses need great locations; others don’t.
Consider Warehouse vs. Dermatologist vs. Burger King vs. retail boutique
The location depends on …
The kind of business; commercial? retail?
Need foot traffic?
Proximity to other things?
Brand signals?
Operations?
Out of the way? Or on main street?
Rent? And cost functions related to Rent?
Location Considerations
Population Density
Traffic — Foot and Otherwise
Competition Considerations
Visibility
Landlord
Facilities
Signage
Location History
Zoning and usage restrictions
Employee and supplier access
Space for operations, inside and out
Power and other services?
Flexibility to upsize or downsize
and … Rent.
Negotiate the Lease
Tactics: Find some instruction on negotiation basics. LinkedIn Learning. Topic in many business books. Topic of future podcast for sure.
All things are negotiable.
They need you: A good tenant is hard to find; Landlords need good tenants. This puts you in a good position to ask for some things — and get them.
Rent isn’t the only negotiation point. Often, it’s the worst thing to negotiate on. Think concessions: trash. Repairs. Build outs. Upgrades. Free months.
Go into it knowing your numbers. Know the neighborhood. The rents. The other businesses. Their history of success (SF restaurant example). Is the neighborhood on the rise? Or the decline? (Pow). How much vacancy around you? Who else occupies? What do your neighbors say about your business? How long has it been available — and why?
Take the lease to a lawyer. What makes business fun? Staying out of trouble. Lawyer knows contracts, all the typical tricks, and also has specific knowledge about other leases in the area. The lawyer can also be asked for their thoughts on negotiation points and concessions. But most importantly, he should maximize your safety and minimize your exposure. Tell you lawyer what you’re scared of! Explain the scary points of your business to your lawyer so he can help craft the deal in a way that protects the downside.
Again — everything is negotiable!
Talking About That Lease
Rent — advise not negotiating on price, negotiate on a few free months or negotiate down the annual increase
Length — Typically longer is better. But hard to say. 1-2 years with an option is good for the first time round.
Subleases and Assignments — These provide flexibility, protect the downside. You can downsize or get out entirely. A sublease is you renting to another party, an assignment is turning the lease over to someone else completely — i.e., you’re out.
Who pays what? In addition to the rent, things like utilities, heat and AC, security, parking can be included — or additional. Find out up front.
Escalation charges — Check with your lawyer to make sure things like property taxes and insurance aren’t your responsibility.
Signs — Check for restrictions. What were you thinking and is it possible?
Utilities — Sometime you have to buy the utilities from the landlord. Talk to your lawyer and be aware!
Renovations — Sometimes the landlord will build to suit, or otherwise improve the property to suit your needs. Ask.
Restrictions on Competition — Limits on the landlord putting competitive businesses in the same area (if you want that — two ways of thinking).
Final Thoughts
Get some other’s opinions and thoughts.
Go by day and night. Weekends, too.
Sit and watch it for an afternoon, for a morning — see what you discover.
Close to anything weird? Bus stops? Public schools? Interstate off ramps?
Imagine where your ideal customer lives or works. Then imagine them coming to this location. What does that tell you?