India retail - How to choose the right location for your retail business in India?

100 Feet Road - Bengaluru

When we were in school, there were no shopping malls or multiplexes or food courts in India. Neither were there fancy, air conditioned coffee shops. The local eatery had a menu that was either typed and laminated, or written out on a board and hung somewhere in the eating area. We would often double check our pockets and the pricing before we ordered, lest we wished to run out of money and walk home. Times have rapidly changed when it comes to the retail scene in India. Shopping malls are around every corner and then there are more coming up. The same retailers are everywhere albeit in different square feet. However, there is still the charm of walking down the good old high street of your city where you shopped when none of these glass and steel malls were conceived. As a retailer then, you have options and your focus is to get the maximum business out of your retail outlet. Here are 10 things to keep in mind, to get your location right:

1. Know your target audience - define them so you can determine if there are enough of them in the area and you can meet their needs. How do they shop and when? What do they want and what are you offering?

2. Find out how people use the area - is there pedestrian traffic that will stop to shop, is there a high enough density of traffic, is it increasing, decreasing, static? Spend time researching by sitting and recording the number of people in the area and going into the shop - even if you're going to have a different product range. Get your hard numbers to make informed decisions.

3. How and when do people get to the area - public transport, cars - what's the parking conditions and costs, walking, and how does this affect the business? Is it a 7 days a week shopping district or a business district where a food shop would rely on breakfast and lunch sales 5 days a week? When are the busy times of the week, are people spending money or being social and window shopping? A shopping mall might look busy but remember that women use shopping as a social event and can spend more time looking and less time spending. (And how we wish that was true in our lives as well!)

4. How accessible is the location? If it is too hard people just won't make the extra effort. Do you have customers with wheels for strollers or wheel chairs and can they get into the shop and move around? Is there cover or shelter to access the shop during the heavy Indian monsoon? What are the extra marketing and promotional costs to overcome poor access? What advantages do you competition have with access?

5. Very few stores have no competition, even if their owners think they have a unique product so sensibly and honestly review local competition. Is there too much? How do you want to compete with other businesses - on price, product, service?

6. Research the local area using maps, population statistics, where your customers will come from and what other shops and malls are in the vicinity. Determine what are the boundaries people use - many don't go outside their muhalla (locality, for you), there's socio-economic considerations, road access (consider if there's direct access or going round the block with one way street limitations), work locations and patterns, physical boundaries like rail lines, industrial parks and more.

7. Talk with local shop owners in the area and with similar shops in other locations for their advice and ideas as it is amazing how much information people will share. You'll also be able to find out about local trade patterns - when people are about, what they spend and when they spend. There's a wealth of information free for the taking if you approach other retailers the right way.

8. Determining whether you'll be best suited for a shopping mall or street strip shopping with the differences in costs and custom. Shopping malls might seem to be the busiest location but their leases, rents and business structures might strip out the profits for a small business leaving you working for the shopping mall owners rather than building a profitable business for you and your family. Whereas a street location might have less traffic, exposure to weather and a cheaper lease. There are down sides and upsides for both options so go through them carefully and know where the money is.

9. Is there a right side and a wrong side of the street or mall? What are the differences in the rent and the income? How long will it take you to get into the right side of the location? What are the plans for the area, will there be changes that will impact the location and for how long? If there is construction work planned how will this impact the access, the local noise and dirt pollution and how long will this go on for?

10. How much experience do you have with negotiating leases and researching a location to make an informed and intelligent choice that will be the best setup for your business? Usually retailers have a limited range of experience and to build an understanding of the local market it's best to look at as many properties as possible to get a solid understanding of lease rates, terms, facilities and considerations. Bringing on board a retail property consultant can make a real difference to how successful your business will be - remember your life savings are usually on the line and investing in an expert is much cheaper than loosing all your money.

Doing your research makes all the difference.

Remember - Location is vital but that doesn't mean it needs to be the most prominent position with the highest rent. Location works when your customers come and spend money with you. Get the entire package correct. Laugh all the way to the bank!

Research includes an article by Belinda Stinson