This lesson is part of our free Franchise 101 course.
When setting up a new business, location is vitally important. It determines what foot traffic you’ll see, how aware of your work people will be, and so whether you’re likely to turn a profit. If your business isn’t purely internet based, then you need to think about location.
Doing Your Local Research
Before you’ve even picked what franchise to invest in, you should do some location research.
Drive around the area where you’re planning on working and see what locations are available. Where are there vacant storefronts that could easily be used for your franchise? Are there shops in a high traffic area for your donut outlet or print shop? Is there somewhere quiet close to schools and employers where you could set up your daycare?
Think about the requirements of the businesses you’re considering and look at what places meet those requirements.
Existing Shopping Streets
One of the first places to look is on existing shopping streets. These will draw foot traffic and people looking to spend money, so they’re a great location for many businesses.
Are there vacancies on the main shopping streets? What types of businesses are there already, meaning that you would face fierce competition? What is missing? And are the vacant spaces suitable for the sorts of businesses you’re considering? If not, then you have two options – consider other locations, or consider other businesses.
Watch out for new developments in the area. Is a new strip mall being built nearby? That might have space for your business, and plenty of customers as the new draws them in. You might be able to piggyback off publicity around its opening. But will it be open soon enough for your needs?
Even when considering existing locations, you should think about what new developments are appearing nearby. You don’t want to set up a coffee shop on main street if the new strip mall is about to drain away all the businesses that brought people there. No other businesses means no foot traffic, means none of the casual customers you were counting on.
What’s Present and What’s Missing?
Look for things that are there and things that aren’t.
You need empty spaces to be available, so that you can set up business in them.
You need other, similar businesses to be absent, so that there’s a gap to fill.
Picking the right franchise is a holistic process, bringing together all the available facts. Some of the most important facts are about the geography of your area, so get out there, walk and drive around, and see what the world offers you.