If you are buying or selling commercial property we have put together this guide to assist you in making that commercial property decision.
1. DO YOU HAVE A HOME FOR YOUR BUSINESS OR A SELLING MACHINE?
People who occupy commercial properties treat them either as it’s a home for their business or its an integral part of their marketing. Think about the other businesses you visit in the next week and class each one as either a home for the business or a selling machine, then look at your own.
Customers, workforce, external business partners and suppliers. You need to consider all of these stakeholders in your business when determining a location. Do you need easy access to public transport for current and future customers or staff? Will deliveries by via a B double or van or both.
3. LOCATION – NEIGHBOURS.
Who are your neighbours and do they help attract business to you or will they turn away business?
4. LOCATION – MARKETING.
Do you need to be highly visible on a main road, which side of the road will get you more sales?
In most Australian cities the left hand outbound road will get anything up to 50% more sales than the right hand side. It’s simply easier for people to stop by on their way home and buy rather than buy and have it with them all day at work.
5. LAYOUT – SALES.
Look at your major competitors and see how they have laid out the sales area. Major companies spend large amounts on layouts. Service station sales increased by over 30% when they put lollies and gum at the checkout.
6. LAYOUT – DELIVERIES.
Ever seen a road blocked by a large truck or prime mover trying to do a delivery to a business that does not have easy access? Delivery time in small spaces = lack of parking for customers = lost sales.
7. LAYOUT COST CONTROL.
Look at your local corner store, most have one entrance and exit with the cash register right at the door. This reduces the need for staff and a few well placed mirrors or security camera’s can be monitored by the same person at the cash register. How can you use this type of thinking for your business?
8. LAYOUT – COMPLIANCE.
Both the external & internal layout are subject to various legislative requirements, do you need a wash facility to cover burns and other injuries? Check with your insurance provider to see if anything needs to be added or removed to meet your legal and insurance requirements.
Does the property have a history of environmental issues? You can easily inherit serious problems buying a property that was previously used as a workshop or some sort of chemical sales or processing facility.
10. RELOCATION COSTS.
Fit out of the new building, advertising the change of address, new signage, new equipment, all of these need to be considered and managed not only from a cost point of view but also take into consideration what level of business interruption is acceptable?
What is the property worth to you? There is one price for someone buying the adjoining property to expand their business, sometimes called a “natural buyer” and another price for someone starting a completely new business with high amount of risk involved.
12. NATURAL BUYER – BUSINESS MODEL.
Some businesses “must have that location” and they will pay above market to get it, if you think about it you’ll deal with these businesses nearly every day, service stations and fast food outlets are the easiest to identify.
13. FUTURE GROWTH.
When your looking to buy think about the future, how fast is your business growing at the moment, will new technology change the amount of space you will need? Over the last 10 years most businesses have more than doubled the amount of business they do from the same space. Some people will buy two adjoining properties, use one and rent the other out.
If you are looking at buying or selling commercial property make sure you talk to one of our team to see how we can help you.
Disclaimer: The above is general information only and has not taken into consideration your individual circumstances. We recommend that you seek your own independent advice before acting on any information contained within this article.