Location! Location! Location!
For many years the popular business mantra is Location! Location! Location! But this comes with little understanding. Let’s explore a more focused discussion of each of the three locations.
The physical location of your business is quite important. This is the most common understanding of what a Location means. If your clientele is quite upscale, then locating in an area that is economically lower cost to you would be foolhardy. Cities are managed through zoning; even still, the wrong types of business can end up in the wrong zones. Retail establishments always do well in the right area. Even business placement within a mall must be carefully considered. Malls are laid out with anchor stores to draw the most people; stores that are in between are often complementary types that catch wandering shoppers. Some businesses do not do well in a mall. So knowing more about this second Location is very important.
The locus of your clients is another consideration for a business. Careful study and understanding of your target market will tell you where the concentration of your potential clients is located. Not only where these ideal clients live, but where they are most likely to shop for your type of service or product. This is a prime example of how marketing can help with determining a location. If your clientele does not frequent a certain city or area within a city, placing your business in that area is not wise. Knowing the “where and how” of your clients’ shopping habits will predict the best Location to operate your business. Build it and they will come doesn’t always work.
Your market position is the most overlooked Location of the three Locations. Where does your business fit in within the Location of your industry? Your industry can be defined by city, county, region, state, country or other geographical boundary. Your location may also be defined by close proximity to complementary industries you rely on as well as those that rely upon you; these are called clusters. A cluster is a location that must be considered for supply chain and logistical purposes.
With a comprehensive understanding of Location, Location, Location, you will have a much higher chance of business success when choosing the right Location for each element of Location (cubed).
By Bill Roberts