Choosing the right location for a business is critical to its success. Property experts often use the phrase “location, location, location” to describe the three most important factors to consider when choosing which properties to invest in.
The same phrase can be adopted for all types of businesses. Choosing the wrong location for a business could result in absolute failure, even if all else seems right.
To illustrate this point, I will share with you the true story of a business from my old neighbourhood that showed lots of promise but ultimately fell victim to being in the wrong location.
The Retirement Dream
Several years ago I lived near a small shopping mall located in a busy suburban area. Palm Waters was used by local residents for quick, convenient shopping trips because of its small size, central location, and easy parking.
One day I noticed that a model train store had opened at Palm Waters. The store was called Grand Central and it was owned by a retiree named Owen. Model trains were Owen’s hobby and opening the store was his retirement dream.
Grand Central looked out of place at Palm Waters. It was a hobby store situated amongst convenience stores such as a bakery, a newsagent and a pharmacy.
During the first few months it was opened, I noticed several things about Grand Central:
- The shop front and store fittings looked expensive
- It was well stocked with lots of model trains and accessories
- Owen was always there during opening hours and seemed to spend most of his time behind the counter tinkering with model trains
But of all the things I noticed about Grand Central, one thing stood out the most – I never once saw a customer in there.
The Retirement Nightmare
After only a few months, the store closed. I was old enough to understand that Owen probably lost a lot of money.
Owen may have known all there was to know about model trains but it was not enough to guarantee the success of his business.
Unfortunately for Owen, his retirement dream turned into an expensive nightmare.
Lesson Learned
Although I was barely a teenager during Grand Central’s short life, the experience taught me a valuable business lessons that I have never forgotten – no matter what business you are in, you must choose the right location.
Had Owen opened his store in the larger shopping mall nearby, where families spent hours shopping for all kinds of things, Owen’s dream may have become a reality.
If you have not yet done so, check out the Free Business Tools on offer by subscribing to our Mailing List. You can also follow us on RSS or Twitter. See you again soon!
