Selecting the right retail space for your new business is one of the most important things an owner can do, but it can also be one of the most challenging decisions. And a key part of this choice is figuring out how large a space you need. To help you, here are a few questions to answer and why.
1. Will the Store Look Empty?
More space isn't necessarily better when you're starting out. The reason is that you don't want your store to look empty. Sufficient space for traffic flow and a clean, fresh appearance is important, but a store that appears understocked can focus attention in the wrong places and actually turn off customers.
2. How Crowded Should It Look?
The opposite part of the puzzle is to avoid overcrowding the store in a location that's too small to support your inventory, traffic flow, and operations. However, what defines overcrowded depends on how your plan to display things as well. Some clothing, jewelry, or gift retailers create a homey, cozy feeling from extra clutter. However, other stores will feel claustrophobic and even dirty.
3. How Perfect Is the Spot?
Location trumps many other factors when selecting a store. If you find the perfect location with good foot traffic and a well-established retail neighborhood, you may want to adjust your size expectations to accommodate it. While this might call for additional inventory management and creativity, it may be a better way to guarantee a good start.
4. What Are Your Growth Plans?
How fast and how much do you expect to grow? Retailers generally plan for some growth when choosing a store size, but this should be adjusted for your particular business plan. Because reestablishing a retail location is often harder than moving other businesses, you should plan for at least 5 years' worth of growth in most situations.
5. What's Your Budget?
Don't overreach your initial lease budget. A small business's first years can yield limited profit, and so it's at its greatest risk of failure if it has too many expenses. Set a reasonable budget and stick to it. If you can establish a successful brand in the first 5 or 10 years, your customers are more likely to follow you if you have to move.
Want to know more about correctly sizing your retail location? Consult with a retail commercial real estate agent in your area today. Together, you can balance these factors and come up with a location that will give your store a great start and create the impression you want for all your customers.