Location is still a magic word, but donÂt pay for more than you need.BIZ SPOTLIGHT – Small Business
When Kerwin Ifill, a former retail sales trainer for the Sealy Mattress Co., decided to leverage his 15 years of retail and sales experience and open a store selling womenÂs designer shoes, location was a chief concern.
ÂAs a retailer, I want to be in a place thatÂs convenient to customers,Â says Ifill, 44, who opened NÃ£Ja Footwear last July in New Brunswick. ÂThis area explodes during the daytime, with a lot of people coming in for work or to catch a train. It means a lot of foot traffic for retail stores.Â
Location can play a big part in a businessÂ success, agrees James Kocsi, district director of the U.S. Small Business Administration (SBA) in Newark. Kocsi says his agency worked with Ifill and New Millennium Bank in New Brunswick to line up financing for the venture.
ÂA good business plan will address the issue of reaching out to customers and making sales,Â says Kocsi. ÂLocation can help, and it may be as simple as setting up shop in a high-traffic mall or on the main street of a city or other high-traffic area.Â
But a prime location will often carry a higher price tag, he cautions, so some thought should be given to just how exposed a spot the operation needs.
ÂDoes your business need to be in a high-visibility area?Â he asks. ÂIf you sell coffee or other products where people come to you, then it may be necessary. But if your business model involves going to a customersÂ locationÂlike a plumber or computer network specialistÂthen location may not be so important. Weigh the costs and benefits before committing yourself to a lease or property purchase.Â
Easy access and competition are other issues to consider, says James Barrood, executive director of the Rothman Institute of Entrepreneurial Studies at Fairleigh Dickinson University in Madison. ÂAn establishment like a restaurant or a bank needs to be available to foot and vehicle traffic, and also needs sufficient parking,Â says Barrood, Âso these can be critical considerations. But a problem arises when an entrepreneur thinks that location is everything and doesnÂt consider lease costs or the presence of competitors.Â
Ifill says he looked into these kinds of issues before opening NÃ£Ja Footwear. ÂI considered three other locationsÂPrinceton, Westfield and Red BankÂbefore I settled on New Brunswick,Â he recalls. ÂPrinceton had nice demographics, but the rent was high and it was already saturated with high-end womenÂs shoes stores. Red Bank was attractive, but the competition there was even worse.Â
He came close to choosing Westfield, but, as in Red Bank and Princeton, found the town already had a significant number of entrenched competitors.
ÂThis is a good time to enter the New Brunswick market, since the city is still in a transitional period,Â Ifill says. ÂBetween existing businesses like Johnson & JohnsonÂs world headquarters, which employs a lot of women executives and others who come in for our shoes, and new ones, like The Heldrich [a new hotel, luxury condominium and conference center], New Brunswick is being transformed into an upscale area.Â
ÂSome businesses attract customers because theyÂre a destination locationÂa business thatÂs so unique that people will go out of their way to get there,Â says Gary Rago, director of the New Jersey Small Business Development Center (SBDC) at Rutgers University in Camden. ÂThink of Ikea. Other businesses may hitch a ride on a nearby destination location.Â Ikea runs free shuttle buses from New York City to its Elizabeth store.
Lois DeCaro, owner of Lois DeCaro, Realtors, took advantage of a locationÂs pull when she opened her real estate brokerage in the Pine Plaza shopping center on Route 10 in Whippany last June. ÂPine Plaza functions as a sort of town center, where people are constantly stopping in,Â says DeCaro, 50. ÂI had been advised that most real estate brokers donÂt get much walk-in traffic, but in fact about 25 percent of our business is made up of drop-ins.Â
In one case, she says, a couple of executives from a telecommunications company that was relocating to the Whippany area were having lunch in a Pine Plaza restaurant, saw her office and stopped in for advice. They ended up retaining her to find a new office for the firm, says DeCaro.
ÂThis space meets all of our needs,Â she says, noting that the shopping center is near major highways. ÂItÂs got visibility, draws foot traffic and the price is right.Â
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