Choose your commercial site based on the real needs and budget of your business.
The first thing you learn is all real estate agents are optimists. The reality is they will advise you that the commercial site you are seeking will be hard to find, and that they have the perfect opportunity, (normally if you sign up quickly).
Reality is that out of about 20 stores you will see, probably only one or two will truly meet your requirements. I normally recommend you write a “property guideline” that you can show agents and others what you are seeking.
We would be offered about three or four “opportunities” a week. The oil industry works to some reasonably clear parameters, and it was just a matter of filtering real opportunities from time-wasting ones.
My property guidelines to address the following types of issues:
- Size – we were looking for mid blocks of around 80m long x 40m wide. If a corner block, then around 60m x 60m.
- Physical characteristics – our preference was a flat block, or if possible slightly above the road rather than below. We would prefer to be on a flat section or slightly uphill section of the road, definitely not a steep decline.
- Side of road – we would prefer to be on the ‘going home’ side of the road, or the “neutral” direction. Inbound was not so good.
- Competition – we obviously did not want to be on the same traffic flow as any of our other sites. Even better if few or no other competitors were servicing the area.
- Road type – traffic flow was important, and the more, the better in general.
- Visibility – we would want good visibility for our signage.
- Access – you had to be able to come in and out easily. Not much good if you could not come in off the main road.
- Demographics – in Australia probably the highest fuel users are medium-income people, living in outer suburbs of the capital cities.
- Suburbs or areas – we would nominate suburbs or specific areas we were actively seeking new sites in, and not be afraid to mention areas we were not looking at, either because we were well serviced in the area, or we knew the land cost would be prohibitive.
Once this was all formed in the property guideline, it was willingly sent to all agents, developers and other interested parties we knew.
If you are looking for a store in a shopping centre or a strip, you can make out your own list of what you are seeking, and then I suggest you be strong, and stick to it until you find the suitable commercial site for your business.
There is no magic formula to selecting a commercial site, rather a process you need to follow and a line of thinking to make sure the site you finally select meets all the criteria that YOU feel is essential for your new business venture.
I cannot tell you to look at the left-hand side compared to the right-hand side of the road, or look for the busiest, most expensive store in a shopping centre compared to the $2 discount store at the back.
What I can tell you is think on what your business is about and try and match, as best you can, the commercial sites being offered to yours and your customer’s needs. There will always be the attraction of a better/bigger site – at more rent – and you have to evaluate that to your real needs, not the sales pressure being placed on you by a leasing agent.
Peter Buckingham, Managing Director, Spectrum Analysis