Many business enthusiasts face this dilemma once they decide to open up their business establishment, specially those who are on their first business venture. There are a number of pros and cons that renting offers to your business but these pros and cons does not apply to all.
What I would enumerate are the pros and cons of renting in a feasible place that would attract your target customers at the same time, gaining market popularity. This might not be applicable to places that was poorly established yet incurring monthly rent.
Observing the place would minimize the failure in deciding the perfect location for your business and once you have that viable location, you now have to consider these factors:
1. You are near and visible to your market.
This has been the best benefit of having a viable place. Since you are near to your target market, you can directly sell to them at their convenience. Aside from that, they would also be able to know you and what products or services can you offer on the table.
2. Sales volume would be unlimited.
Being in touch with your clients or customers, you now have unlimited opportunities looming around. You might even exceed your sales projections on the area once your products or services are known to be of high quality at a viable price.
3. More convenient than having a home business.
Although home business is a good idea, having a specific place to do your business is much better since you would be away from your home which means you cannot be distracted while you are doing your thing at home except during emergency. Imagine the benefit of having a good night sleep which cannot be enjoined by those who have their businesses at home since they might be disturbed any time of the day.
1. The rent might be too high for your business.
This might be the issue of wholesalers, distributors and retailers. They only rely on their mark-up in determining whether such mark-up on their products would be able to cover up their operating costs. Once the rent is eating up your potential profits, might as well look for a cheaper one than loosing your business.
2. The place might not be suitable for your business.
Another dilemma that you might realize when you are already starting the contract with your lessor. Imagine if you are into a restaurant business and your place does not even have a sink. Adios! Amigo! This could be well avoided if you really know what facilities do you need and how big. You should just not look the place on a market’s perspective but also on how you would operate on such place.
3. There are too many competitors on the area.
This scenario might prompt you to look for another place, but if you know you have an edge over your possible competitors, then proceed. Having too many competitors might also mean that the area is not dominated by a sole provider but rather, by everyone offering the same products or services. If the area is dominated by one, that is much more of a red flag than having a lot of competitors on the same segment.
Considering these factors might give you a hindsight as to whether to pursue or to decline your lease contract. These are only the general factors you might want to consider, but this list could be your guide. I may have not cite everything as possible so if you might have questions or ideas, feel free to use the comments. Thank you for reading.