How to Pinpoint the Right Location for Your Franchise

Knowing where to base your business is hard, let alone making the final decision to put down a deposit. It’s impossible to know if your chosen location will be lucrative, but there are ways to minimise risk. Here are the key steps to find the right location for your franchise unit.

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Pinpointing the perfect spot for a business involves a lot of careful planning. The success of a franchise unit relies on a large number of different factors, all of which should be considered by any prospective franchisee.

Why is location important for a franchise business?

Many people invest in a franchise model because they think having the chance to use tried and tested strategies will guarantee success for their business. In reality, although franchising reduces the level of risk involved in becoming an entrepreneur, no one can say for sure whether your unit will work well in a given location.

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As a result, it’s vital prospective franchisees do their due diligence when it comes to site selection. While it might be tempting to jump on any opportunity to occupy a site on your local high street, every business is unique and will perform differently in various locations. Get the decision wrong, and you could end up with an underperforming franchise business.

It’s worth spending some time identifying the key requirements of your franchise unit and choosing an environment to reflect them.

How to find the best business location

1. Choose a town or city

As you begin searching for the right location for your franchise business, you’ve got two options: set up in your hometown or choose to relocate to a city with better opportunities.

If you don’t intend to move, you should make sure your local area has the resources and demand to support your business. If it doesn’t, you may need to select a different franchise. However, choosing somewhere familiar may put you at an advantage, as you’ll save time on research if you already have a good idea of the local market.

At this point, consider the demographics and competition. Ideally, there will be local businesses similar to your chosen franchise, but not enough to saturate the market and drive down demand.

2. Identify the key factors for your franchise

Once you’ve selected your town or city, you can begin to narrow down your property search and start considering smaller areas and suburbs. But if you’re to pinpoint the right location for your franchise unit, you’ll need to know what you’re looking for.

Take the time to decide which factors will be crucial for the success of your business so you can start searching for your chosen spot.

For example, coffee shops benefit from being on a pedestrian commuter route, while businesses selling luxury goods should ideally be located in an affluent area. And restaurants are able to cater to more people if they are based in a unit with a car park or nearby transport links.

3. Select a suburb or street

With your vital factors in mind, start reviewing potential suburbs and streets. Look at the other businesses in residence there and how they’re performing - have they been able to stay profitable there for a decade or more?

Here are just a few of the key aspects to explore in any location:

• The demographic of the local population; their age, income level and relationship status, for example
• Nearby offices and commuter routes
• Nearby tourist attractions or educational or business institutions with a predominant demographic
• Nearby transport links and public car parks
• Competitors and how they’re performing
• Times of high footfall and whether they align with your business’s opening hours

If you’re launching a food business, take a look at our guide: 12 Things To Consider When Identifying The Right Location For Your Restaurant Franchise.

4. Choose a side of the street

You may not have stopped to ponder which side of the road you should scour for property vacancies, but it could make all the difference to your revenue.

Let’s say you’ve identified a busy location for your coffee shop, just a few hundred yards from a busy station used by hundreds of commuters each day. The spot might seem ideal for a cafe, but, in practice, most commuters use the other side of the road when they walk to work in the morning. If you had intended to make most of your income during rush hour, this oversight would spell disaster.

If you’d opened your cafe on the other side of the road, catching the attention of morning commuters eager for a quick caffeine fix, things could have been completely different.

5. Choose a property

At this stage, you should have narrowed down your search area to one side of a particular street. You’ve made good progress, but it’s now time to start consulting an estate agency and look at specific properties.

Although you will have pinpointed a location with high potential for your business, there are still several important factors to consider. Depending on the type of franchise you’re joining, you may need to limit your search to properties with car parks, an in-built commercial kitchen or a large shopfront, for instance.

In addition, you should always aim to secure business premises with great accessibility for those with limited mobility.

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Start a franchise business and become a franchisee

The franchise industry offers huge potential for those dedicated to minimising the risk of failure and searching for a network of like-minded professionals. And there are plenty of useful resources available to ease the journey into business ownership.

We work to support budding entrepreneurs who dream of launching their own business. Take a look at the latest news in the franchising world(/news/franchise-news) or view our complete selection of business guides(/news). We also have a catalogue of interviews with franchise experts to inspire and inform those looking to enter the industry.