Entrepreneurs may be thinking about renting or buying a physical business location. Getting a good look at the different things involved with owning a physical location will help owens make decisions on if it makes sense for their business at the time or not. Here are some pros and cons to have the storefront location.
Pros: Employee Interactions/Client Meetings
With this new system, they can meet their clients in person, and they can build a business relationship with them more easily in this way. Not to mention, it can eliminate some of the business-client errors in communication that can sometimes arise when they only communicate via phone or electronically.
In dealing with a client in a physical setting, they can also get a sense for their personality and how to best serve them. When people only speak with them online or through the phone, it can be harder to get a sense for what the person is like.
Entrepreneurs can grow their business more easily when they have a physical location in this way because some customers will see it as more legitimate. Because of that, they will be more willing to work with them and give them their money. That isn’t to say that an online business can’t work, but this tends to help.
Pros: Local Physical Presence
Becoming a pillar and asset of the community is what this is all about. When people work online, sure they can serve people from all over the world, but they never develop a strong branding in their area. Doing it in this way will help them to build up a physical presence. Being a local business, they help the community, and they also offer goods in the community that helps to enrich the community.
Pros: Opens up New Markets
Working locally at a physical location will open up the local market in a big way. People that they may not have met otherwise will walk into their office to request help with a project.
Cons: More Expenses
Perhaps one of the biggest downsides is that a physical location will cost more than having a home office. Entrepreneurs can expect that it will cost them more cash. That doesn’t mean that they can’t do it, but they should expect it to cost anywhere from $8 to $23 per square foot of office space, depending on where they rent. Businesses looking to expand from online only, to a storefront location often take small business loans or use saved capital to afford move in and set up costs. Part of any owner’s considerdsatipn process should include weight lender options on a site like Lantern Credit that allows you to compare loan options and their terms before making a decision.
Cons: Less Flexibility
In the online context, people can work with anyone from anywhere in the world. They could be in New York City and work with someone in real time in Shanghai, China, on that day. When individuals have a physical location, they can still do this, but it doesn’t lend itself to as much flexibility. People feel like they have to show up to the office when they’re paying to rent the space.
Cons: Higher Payroll
People should understand that when they rent a physical location, they will have to deal with a higher payroll. With a storefront location you can expect to make more revenue, but also offset some of that income by paying employees to work in the store. You’ll want to weigh the money made vs. money paid to staff managing the location.
The purpose here is not to sway people either way into a physical business location. Instead, the purpose is to help them make up their own minds if they want to do it.