Test Potential Sites Before You Commit
Your business space is cramped. The landlord won’t make repairs. You’re too far from your target market. There are many reasons why a business might want to move. But moving can be risky and expensive—what if you lose loyal customers? Will you draw enough new customers to make the move worth it? A new location could surprise you with business headaches—poor parking or bad lighting after dark, sparse foot traffic during peak hours, or too many competing businesses nearby and not enough complementary ones. Can a boost from a larger footprint in a thriving part of town balance the cost of the move and possibly greater rent and utility costs?
What of the downtime while you pack, move, set up and unpack—that could close your business for a week or more. Before you face the expense, hassle and loss of business, you want to make sure a move is worth it to your bottom line and supports your potential for growth. But how?
There’s a straightforward way to get reliable, data-based insights about business locations to help determine whether it’s time to relocate: model potential markets and locations before you move.
Being closer to home or affordable labor, reaching new markets, upgrading facilities or extending floor space—these may be important considerations. You’ll gather a lot of data while you weigh pros and cons. Maybe you’ll visit prospects at different times of the day or week; count passing pedestrians and cars; walk neighborhoods; take public transportation and drive to each site. You might visit neighboring business owners to ask about clientele and sales, even scan U.S. Census data to learn about the people within a mile or two of each location. But how much will you really learn about how a new location will shift market demographics, change market size or affect the willingness of customers to visit your new business area?
This is where location analytics come in. When you view target customers and clients through the lens of spatial behavior, you get accurate location-based data about their travel, shopping and spending patterns that can open the door to a sophisticated understanding of needs and trends. You’ll use this powerful data to help locate your business, expand your market, focus offerings and aim advertising at exactly the right audience.
Apply location intelligence to site selection, market assessment and location-based advertising to make critical business decisions with greater accuracy and less risk. Get a more complete picture of a location’s potential and forecast sales with more confidence. Make your business plan more attractive to shareholders and potential investors by supporting goals for expansion with empirical data.
Using verifiable locational data to model areas helps you avoid being unduly influenced by emotional factors. Even the most level-headed business owner will be impressed by great curb appeal, attractive neighborhood amenities and generous move-in incentives. But if a location isn’t well-suited to your target market and doesn’t bring customers to your door, none of those fancy extras will boost your bottom line.
What Variables Should You Test for Each Location?
First, determine the size of your market for each top location option. Are there enough potential customers near each site? Spatially can determine the true size and shape of your market, noting clusters of home areas of high-engagement consumers who already tend to visit a particular business area. We provide actual drive times between those consumers and potential business locations and real-life demographics of people who have already visited competing or complementary businesses in your chosen areas.
Wondering whether an area has enough inhabitants with the interests or income to support your business? Don’t guess—test. Spatially can show each business area’s income levels and spending habits. Test potential locations for market size, spending patterns and interest in your offerings. Now that you can discover crucial data—information that could make or break your business—quickly, conveniently and economically, why wouldn’t you model each location and test for potential profitability?
Thinking of advertising to your target customers, but not sure how to reach them? We can show you which areas they live and work in and their frequent travel routes. Target advertising to the online and real world locations that matter most to them, and make sure your ads come up in their local online search results. You’ll see which marketing and advertising plans are likely to result in the highest levels of customer engagement.
Already have a great location, but want to expand to another? Spatially helps you find locations with features and customers similar to yours, so you can discover new segments and expand into emerging markets. We help you avoid cannibalizing one business location when you open another by modeling how far apart they should be for optimum sales.
Support High-Tech Analysis with Low-Tech Leg Work
Brick-and-mortar locations are compelling because they’re three-dimensional, surrounded by all the delights (and challenges!) that come with real-world living. Gathering location intelligence gives you an enormous edge, but adding a bit of real-world research boosts your chances of choosing a location that your customers will want to spend time and money in.
Visiting top site options at various times will help you discover problematic practices or adverse environmental issues. How is nighttime lighting? Is parking convenient? Is the area well-tended? Being located near smelly trash bins or noisy clubs may make a business less attractive. Is there space in the building that would allow for future expansion if necessary? Think about how the location could help or hinder you as your business grows.
Sometimes investing in improving productivity makes more sense than moving. Additional staff, training and equipment upgrades may boost income more than a move to a new site. When you model possible new locations, make sure to model your existing location as well. When you compare them, you may find your current location has more benefits than you realized. Making improvements to your current location and expanding your market by altering or extending current offerings, focusing advertising or finding new market segments may be more profitable. If you stay where you are, you can still use the power of location analysis to target your advertising to local markets using the Spatially Ads platform.
Another way to grow a business is to split your operation into more than one location. A company that manufactures and sells from a single location can move its warehouse and manufacturing to a less expensive facility while leaving its sales outlet in the same place so customers won't have to find a new spot. This provides a seamless, continuous retail experience while allowing you to grow.
Make sure to visit all locations on your short list. Note traffic patterns, neighborhood dynamics and style and building condition. Ask neighboring business owners about their experiences.
If you’re considering a remote location and aren’t sure whether it’s a good fit, try the city on for size. As Thursday Bram of Hyper Modern Consulting says, “An expansion can be as simple as driving to that city once a month and getting a day pass for a coworking space. Consider what the minimum presence you can get away with is, along with how you can test that you’re moving to the right city.”
Work Your Network—Check in with Local Connections in New Markets
Put real-world experiences of others in your network to work for you. Who do you know with knowledge of the markets you’re considering? Can they introduce you to others in the community? The more personal connections you have in an area, the better your chances are of successfully integrating with that community. You’ll hear about experiences and local regulations that could boost or hinder your business before making a move, and you’ll have a better chance at getting introductions and referrals once you relocate.
Before you look at any potential location, determine the size and location of your available market as well as how robust it is. What is the competitive landscape like? Is it oversaturated? Is it minimal? If you haven’t much competition, does that mean you’ll be likely to dominate, or that there isn’t much interest in your offerings? Modeling will give you critical insights.
While you’re considering your competition, find out what their customers look like. Comparing their reality to your fantasy gives a much-needed reality check. When you see what competitors in each potential location are offering, you might consider refocusing your business to fit (or avoid) that niche.
By incorporating our geospatial expertise in your business planning, you can choose your initial site, expand to new locations, find your market or focus your advertising with greater accuracy and lower risk. Using Spatially’s powerful location modeling and testing tools you can increase investor confidence in your business plans and uncover a wealth of site-specific intelligence. Let us help you to grow your business.