Finding Fertile Ground: Why Location Matters

Location, location, location isn’t just a rule of real estate. It’s a rule of running a business, as well. It’s easy to want to plant your flag where you grew up or where you now live. Indeed, having that insight and understanding of the area can be very valuable to a business. But it’s not always the most profitable choice for the business. Here, we’re going to look at the three major impacts that choosing the right location in business can have, whether you’re looking at a fresh startup or expanding to a new area.


The simple truth is that you’re not going to be able to run your business the same in some areas as you are in others. The website gives a very clear-cut example in the fact that it’s easier to set up an LLC in some states than it is in others. There are also state and local considerations and regulations that might limit your business or enforce aspects of organization and administration that might work contrary to what you want from your business. Business owners have different priorities in how they exercise their freedom to run the business as they please and might have to find a different location to find that freedom.


The ease of starting a business of a certain structure and the different regulations you have to follow in an area might also dictate certain costs that you have to take into consideration. But there are other ways that the location you choose makes difference in costs. uses New York as one example, including how Paid Sick Leave Laws can end up costing business owners thousands of dollars a year. There are also local costs of supplies, services, building rent or ownership, utilities and more to consider. For a business to succeed, it has to be able to make more than it costs to run it, but in some areas, that might not be as easy.


The services and suppliers you rely on are just one example of the different people that your location offers you access to. For retail and service brick and mortar industries, finding the right area with the right curb appeal potential and foot-traffic will play a huge role in the reach you have regarding customers. The same goes for choosing a location based on the talent pool you can hire from, with sites like making it clear that some areas, like Seattle or the San Francisco Bay Area, offer a greater selection of employees better suited for tech companies. There’s also competition to worry about. Setting up too close to competition can seriously hurt a business’s chance of standing out and finding their place in a market.

The hurdles you give yourself and the flexibility of the business. The costs of setting up and the wages the local population expects. The consumers, the competition, the talent pool. These are all considerations that can dictate why a business might fail in one area and excel in another. They should all contribute to where you decide to set yours up, too.

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