Owning a business has been many Filipinos' goals. That is why in the recent years the number of Small and Medium Enterprises (SMEs) has increased. Indeed, venturing in entrepreneurship is attractive; with the booming economy, people get to spend more disposable income, helping the performance of several businesses. However, owning a business is not a piece of cake. There are a lot of things to consider if you want to become successful. When starting out, one of the biggest decisions that a business owner has to make is where to put up the store. Here are some tips in choosing the best space for your business.
1. Understand your business - Have you already done your assignment? If not, you first have to know who your target market is. By doing this, you would familiarize yourself with their behaviours--where they usually go, what time they would probably buy your product, and whether or not they would pass by your establishment. Also, understand how they make purchase decisions; do they buy it by impulse or do they go through decision more carefully? As an example, by knowing that most people in a shopping mall buy ice cream by impulse, you might want to opt for a space for your ice cream parlour that is highly visible to passers-by. Another big consideration is your budget. How much of your regular sales are you willing to allocate for rental payments? Most say that it only has to be 10% or less. If you are willing to go more, make sure that the long term benefits are worth the investment.
2. Know where your competitors are - These businesses competing with you to attract the same market have most likely done research. By knowing where they are, it somehow frees you from incurring costs for more research. Try to find a space within the area that is exposed more to your target consumers. On the other hand, you also have to understand where complementary businesses are. What are these mainly? For example, if you are a milkshake business, situating your business near a burger shop is a strategic way to boost your sales. Most buyers of burgers would like to pair shakes to go with their burger. Knowing this can highly help you in your business decisions.
3. Check for leasing agreements - Make sure that you go through with your landlord his and your responsibilities as landlord and tenant. One important thing to ask is if your contract agreement is noncompete. Meaning, the landlord is agreeing not to allow future tenants that directly compete with your business to lease out a space. Additionally, note the facilities included in your lease agreement. Are your customers allowed to use the restroom in the lobby area? Can you share with the centralized air condition units of the building? How many parking spaces are assigned for your business? By asking these questions, you can plan out better how you would make customers prefer your business over others. Lastly, understand how the termination of your agreement works. Make sure that you are allowed to negotiate when you can dismiss your lease, in case worst comes to worst.