Location: Local environment
Choosing the location of your business also depends on the environment that your business needs. Important information includes, for example, the number of competitors and how often potential customers pass by the location. When choosing a location, a comprehensive analysis of the environment is very important.
Ask yourself the following questions:
- What kind of infrastructure does the environment of my company location provide for me?
- Which competitors can I expect at the chosen location?
- What infrastructural advantages does the desired location of my company provide for me?
1. Hard and soft location factors
A basic distinction is made between hard and soft location factors. Hard location factors (e.g. transport connections, labour market, condition of the company building) can be reflected in data and figures and have a measurable influence on company activity. Soft location factors (e.g. residential environment, environmental quality, recreational value, image of the municipality), on the other hand, are difficult to measure, but can play an important role, for example in employee motivation and the availability of human resources.
What is the supply of goods and consumables? Are there potential cooperation partners locally? Are there any companies in the same area that are active in industries that complement your service? Good contacts are important: It is therefore essential that you build yourself a network.
3. Labour force
Can you find suitable personnel nearby? Is the location attractive for specialists and managers who have to be recruited from further afield? What is offered culturally and how high is the leisure value of the location? Are there schools and kindergartens? The quality of life of a place has a proven impact on productivity and quality of work. So choose a location where you and your employees can feel comfortable and well-served.
Do local competitors play a role in your business plan? If yes: How strong are they? How many competitors are there? How promising is your service in comparison to their products or services or how strong is your unique selling point? Always consider the competitors’ offers in your calculation. This is the only way to obtain a realistic assessment of your chances of success.
5. Technology and start-up centres/coworking spaces
Technology and start-up centres, but also coworking spaces, can offer many infrastructural advantages. Are there such facilities at the desired location? If yes: Is it possible to settle there?
What public and private advisory services are available? Are universities nearby with which an exchange of information or other forms of cooperation might be possible?
The environment is insignificant for our project in the first step, as we receive few customers at our office and carry out our work at the customer's premises. We would like to settle in a start-up centre or coworking space to allow us to possibly save rent.