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Choosing a location for a new business is one of the most important decisions. Entrepreneurs should plan before launching ventures. The location of a business can affect many aspects of how it operates, such as total sales and how costly it is to run. Even home-based businesses and online businesses can be affected by location-dependent rules and regulations.


Location is of utmost importance to businesses that sell goods or services directly to customers at brick-and-mortar establishments. For example, a card shop located in a popular mall is likely to attract more customers than a similar shop located in a run-down part of town. Location can also influence a business’s ability to market itself.


A business’s location can affect the competition it faces from businesses that sell similar products and services. For instance, an upscale neighbourhood in a major city might have dozens of ethnic food restaurants, while a small town might not have any businesses that sell ethnic food. Starting a business in an area with few direct competitors can increase the likelihood of attracting customers.

Operating Expenses

The location of a business can influence the total cost of operation. A business could be better off opening its doors in an area that is cheap, even if it results in fewer total sales.

Taxes and Regulations

The location of a business determines the local taxes that owners have to pay. Income tax and sales tax rates vary from one area to another.  Government zoning laws can limit the size and construction specifications of buildings and the use of signs. State and local laws can also affect the types of permits and licenses necessary to operate a business.

Home Businesses

Home-based businesses offer a variety of advantages over companies located away from the home, which can make them attractive to small-scale business owners. The cost of operating a home-based business is typically lower than paying to rent retail space or office space in other locations. Home offices can cut down on travel costs and make it easier for owners to balance work with home life. The cost of operating a home office is also tax deductible.

Perception of location

A business’s address is an important factor in the way that business is perceived. Consider yourself the impression a business address has given you before.

When a business is located in an area where the majority of businesses tend to be in a certain sector. This influences the sector that business is assumed to be part of too. For example, choosing a business address in the City will likely change the perception of your business.

Equally, choosing a location in a creative part of town to influence how creative your business is assumed to be. Much in the same way as we make assumptions about people based on the circles in which they move, our business can also be viewed differently depending on the location we choose.

This is especially important for start-up businesses. It’s not uncommon these days for a business to start in the home, but to use a residential address as your listed business address may not give the most professional impression.


Yashu Sthapit

it's me...........

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