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Beware of These Common Mistakes in Picking a Location for Your Small Business

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    Have you just started an LLC? Are you looking for a good location for your business? You’re not alone in your search — many entrepreneurs are also in a hunt for the best business location. But not just any place will do. Choosing a location for a business is like looking for a spouse: There are many to choose from, but only one is perfect for you.

    So how do you decide? For starters, there are some common mistakes you need to stay away from when choosing a location for a business. Here are a few:

    1. Misunderstanding the Costs and Your Finances

    Far too many people who are looking for a business location fall into the trap of "shiny object syndrome." They want the latest and the greatest with their location, but don't fully understand the costs involved (some of them may be hidden), or whether their own finances can withstand the expense.

    This can be difficult if you are just starting your small business, as you aren’t quite sure yet what your cash flow will look like. In this case, it’s better to go on the more conservative end of the spectrum with choosing a location for your business rather than getting in over your head right from the get-go. The last thing you want to do is find a business location that has you paying more than you bring in every month just to cover the bills.

    2. Looking at the Space Instead of the Location

    While you may be in love with a space, it’s the physical location that will determine if it is a good place for your business. If you run a high-end apparel business and plop your store in a location that, unfortunately, is surrounded by poverty, the likelihood of your business making it long-term is slim to none.

    Make sure you are choosing a business location that is surrounded by your target demographic. Don’t simply rent or buy because you like the space itself — you need a location with great foot traffic that is easily accessible and simple to find.

    3. Forgetting About Location Access

    There's plenty to consider when it comes to your customers' ability to access your location. Here are some example questions to ask yourself:

    • Is your business located off the beaten path, or is it otherwise difficult to find?
    • Is it in the basement of a huge building, making it hard to figure out where you are actually located?
    • Are there 30 steps leading up to your entrance, which customers must later descend carrying whatever they purchased from you?
    • Is the building handicap accessible?

    A good location for business is one where your customers know where you are, can simply find your business, and can get in and out of your space easily.

    4. Not Knowing Your Customer

    If your business deals with apparel, for example, you should know the type of apparel your target demographic is looking for. If your customers want the latest and most hyped footwear, you need to choose a location that is surrounded by customers who are looking for such products.

    Think of something like a big city. If you’re trying to sell the newest pair of Jordans or Yeezys, you probably wouldn’t want a location in the Amish countryside, right? Know who your customer is and where they are to determine a good location for your business.

    5. Assuming (Anything)

    I think it’s safe to say that no matter what example you are using to fill in the blank here, you should never assume. You want evidence and facts to help you make the best business decisions. Just because an area looks like it would be your ideal business location does not mean it is. What other stores are around the location you're considering?

    Are there future development plans that would help or hurt your business in the long-term? You need to know the current and future landscape of the surrounding area. You should be able to go to your local government agency and ask them for their plans over the next 10 years.

    6. Forgetting to Involve your Attorney in a Lease/Contract Negotiation

    Any business (big or small) needs to have a good attorney. You'll want this attorney to help create your own contracts and business documents, and you also want them to look over any contract that needs your signature.

    Any lease agreement or contract to purchase a business location should go through your attorney to ensure you are properly represented and have not overlooked any part of the contract/agreement that could put you in a bad spot down the road.

    7. Moving Too Quickly

    Hopefully, you didn’t rush into starting your business without thinking things through first. Likewise, you shouldn’t rush into or be pressured into a certain location without doing your due diligence. Don’t allow realtors to pressure you into making a decision — especially one that could negatively impact your business if the location isn't ideal. Your realtor's job is to help you find a good location for business, but you also need to realize that they want to close sales as quickly as possible to make their commission and move on to their next client.

    Always remember one thing: a realtor's commission comes from YOUR decision. If you feel like they are pressuring you to act quickly to put in an offer or sign a lease for a business location, it might be time to find a new realtor. Having your own business location is a major expense, and one you should not rush into without fully understanding the repercussions.

    The same can be said about friends and family who you ask to come to visit a space with you. They could very well fall in love with it and tell you to act quickly, but they may not have all the information you do about the surrounding location, demographics, etc.

    8. Paying Full Price

    You want the best deal, right? Say you've found a great business location but aren’t completely sold on the price. In this case, negotiate. There’s nothing wrong with stating your case for what you feel is a fair price for the business location and allowing the other party to think about it.

    While you can't guarantee that they'll accept your offer, the worst thing they can say is “no.” The answer would have been "no" anyway if you never asked — so you have nothing to lose.

    Something else you should consider when putting in an offer for a business location is whether you can work a long-term deal. If you are leasing the space, ask about a cost reduction if you extend the contract, which would ensure more money in the pocket of the landlord while giving you a better deal.

    If you're purchasing the space, ask if they'll reduce the price due to any necessary renovations or repairs. Would they lower the price to get a quick sale (assuming you've done your homework and are sure of your location)? Most things in life are negotiable if you can find a way to satisfy both parties.

    The bottom line when it comes to choosing a space is the same as any business advice: be prepared and do your research. If you still need to form your business entity before securing a space, Bizee can help you do so quickly and easily. And once you're all moved in, we have plenty of services that can help make your life easier, including helping file your business taxes and serving as your Registered Agent.

    Matt Weik

    Matt Weik

    Matt Weik is the Founder/Owner of Weik Fitness, LLC and is a well-respected fitness expert/author with a global following. He’s a certified strength and conditioning specialist, personal trainer, and sports nutritionist. His work has been featured in over 85 fitness magazines and over 1,500 websites. You can contact Matt via or on his social channels found on his website.


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