Choosing a good location for your small business is one of the most important decisions you have to make for your business. There are many different issues you need to consider carefully before you make a location decision. How to decide where to locate your small business? Well, while there are many important factors you need to consider when making a good business location decision one of the key factors are the overall cost of a specific location and your business requirements - based on your business type and your industry and market.

So before you go into details you need to start focusing on your business specific needs. At this point you need to ask yourself the following questions: What is important for my business? Where my competitors are located? Where can I have access to my target market? What is a good location for dealing with my suppliers and vendors? For example, if you are planning on opening a restaurant one of the most important decisions for choosing a good location will be your target market. On the other hand, if you are planning to start a manufacturing business you need to balance between proximity to your suppliers (overall supply chain cost of doing business) and proximity to your sales distribution network (overall distribution cost). In any small business scenario considering the total cost of ownership when making a location decision is critical.

When your business location decision is driven by the customers’ location you need to consider the trend in that specific location such as the trend in population growth, number of competitors in the area, rent price per square foot, how long you plan to stay in that area and of course the total cost of doing business. Take a look at the big picture of your business and your bottomline and do not focus only on the price per square foot when making a decision. Different business locations will generate different revenues and overall costs of doing business so try to build different business scenarios and analyze the overall investments you need to make, expected profit and of course the risk of making a specific decision.

Other important business location criteria are the overall traffic in the area (some small businesses such as retailers need high traffic location), parking availability is also very important for many businesses such as retail, offices and restaurants and the condition of your space is a critical cost driver as well – in some locations you will need to make additional investment to improve your business space.