When looking into real estate whether it’s for your home or your business, the first thing you should always do is create a list of what is important to you and what it must have. This can include details that are very specific to the type of business that you will be opening. Remember that most of the time, the things you will desire will pull the cost up on the purchase price and may not be a lasting effect—such as crowds of people to the mega stores. The consumer business is one that is ever changing with corporate deals, mergers, and shutdowns so be aware of the benefits and risks of any detail that you want your location to have.
Another thing to remember is that while you’re making your list, you can ask for suggestions from the franchisor, franchisees, friends, and internet, but there is no 100% rule as to what makes a location good. There will always be clear indication of what makes it bad: inaccessible, poor foundation, bad neighborhood, but the good will vary from place to place depending on community culture. Or for instance, if you’re opening a retail location, it’s best to keep your eyes open on busy streets with people commuting to work, going to entertainment businesses around, or office buildings that are nearby. This will give people a chance to recognize your brand and see it every day. However places offering in-home services like cleaners, movers, and repairmen or less commercial franchises like mailing services, don’t’ need high visibility, but need to spend more on proper equipment. These are just some examples of varying needs for different franchises.
The bottom line of finding a location for your franchise is that a good franchisor will give you tips on how to find a great location, but most of them won’t hold your hand. Most of them will also give you boundaries on where you can place your location in a certain area and you’ll be expected to find property in that area. Franchisors aren’t parents, most of them won’t hold your hand through the process, but they want to teach you what it takes to succeed because the bottom line: your success means their success. You’re an investment for them from the moment you walk through the door. When you find a site, you will run it by your franchisor, so the start and the end point will be work done together, but everything in the center such as surveying and researching areas, will mostly be done on your own.
Aside from drive-bys, other ways you can gather information on specific locations include calling the owner or real estate agent and asking them whatever questions you might have. You can also seek demographic information for the area, which is readily available through the right resources. Demographic information these days offers more than enough information in most cases, including census tracts, block groups, zip codes, radius measured in miles, drive-time polygon, and other configurations.
Information about drive times is usually the most helpful for any retail business owner considering all people who will visit your place will be coming from or going to some place. If you provide a certain amount of time, a computer program can actually draw and irregular polygon styled by vehicle speeds on various roads, materials, and highways, and provide you with information on demographic and employment in the area. You’ll be able to make assumptions about employees in the area, how far they will drive for lunch, and how that will affect your business based on location—or to even change location to fit the perimeters.
As you research different locations, keep your eyes out for any red flags like pieces of property that keep going on the market at record speed or that are getting turned over constantly. If you’re purchasing a building that’s already in existence, make sure to do a walk through and be aware of any mold you see or strange smells. If a business is still operating inside, you need to figure out why those smells are there (do they offer smelly products like fish and sometimes produce?), is that the smell of something rotting or is that the smell of something dying? Don’t let your need and eagerness to find a place blind you to the pitfalls and traps that other franchisees or business owners might lay out for you. Even if you think, “We will renovate and it will be fine”, depending on the damage to the building, renovation can sometimes often cost more than building from scratch. A good rule of thumb to keep in mind when checking out a location is if the smell, style, or neighborhood might turn consumers off, it’s probably not the best place to be. Be wary of loud or annoying sounds that are regular in the area, if any, or neighboring business that might detract from yours by being sketchy, poorly reviewed, or poorly taken care of.