One of the main reasons most businesses fail is because of poor management and planning.
It takes more than just an idea and a catchy business name to make a business successful. In addition to a good idea you will need a business plan and some start up capital. Depending on what type of business you are starting, you may need thousands of dollars in start up capital and a ten page business plan. Unfortunately many business start ups don’t have this, and they end up closing within two to three years. Although the owner of the business had good intentions, those good intentions were not enough to pay the bills and attract customers. What these owners lacked were good marketing skills and financial planning.
The recent economic depression really disproved the old saying “If you build it they will come”. Today, before you build anything (including a business); you better make sure that the location you select has the customer base and income to support it.
Too many times a person will a launch business in a neighborhood or community without doing any research. Conducting market research is very important especially for a new business. The research results will reveal if there is a strong potential customer base or if there are competing businesses in the area. Unfortunately many entrepreneurs don’t discover that there is competing business only a few blocks away until after they sign a lease. Had they done their research, they would have known that they needed to launch their business in a different location. Or, had they known that competing businesses were in the area they would have realized that they needed a more innovative and aggressive marketing strategy.
Selecting the wrong location is another major reason many businesses fail.
Before selecting a location for your business, you need to make sure that the area is appealing to the customer base you are trying to attract. If the customers you are trying to attract are upper income people, than the location needs to be visually appealing and have the impression of being safe. This includes making sure that all the areas around your building or retail space is clean and well maintained. It is also important to make sure that the location you select has safe and secure parking, and a well lit parking lot. Otherwise customers will not feel safe patronizing your business or parking their cars.
If you are depending on heavy foot traffic to generate revenue for your business, than your business location should be near a train station or on the bus line. By offering discounted train or bus passes to frequent customers, will help you increase sales and also build customer loyalty.