Presenting the Right Image Through Your Business Facility

Your facility should convey a positive image about your business and allow for factors personal to you, as well as for future growth economically.

The facility you choose to run your business from can make a powerful statement about your business. Obviously, the statement your facility makes about your business should be a positive one. If you make the right choice, your facility should present your business in a good light. But just what "in a good light" means may be different from one business to the next and will be influenced mainly by who will see the facility and by the nature of the business that you are in. Also, figuring into your decision are quality of life issues that can't always be reduced to dollars and cents.

Who Will See the Facility?

If your business regularly deals with retail customers, then the question of what will put your business in a good light will be closely related to what kind of business it is. If customers don't enter your facility, the facility's appearance usually will be less important. But this doesn't mean that you can totally ignore the issue, since no matter what your business is, someone will see it — your employees, suppliers, and certainly yourself. Thus, even if your facility is spartan, it should be clean and well-maintained, and should serve as an efficient tool of your business. If it is otherwise, you risk having suppliers (and employees) question your business's prospects for long-term survival. At a minimum, your business site should not demotivate anyone (including you!) who works there.

What Type of Business Are You In?

If you expect your business facility to help customers view your business as you would like them to, they must see it as evidence that you (rather than your competitor) understand their needs and desires. The type of facility that helps establish this image is not the same for all kinds of businesses. If you are selling "high-end" products or services at retail, your customers may expect a spacious and elegant sales area. Not only that, but any facility that bears your company name — even if it does not directly serve customers — may be expected to live up to a similar standard.

Mary Purebreed operates "Mary's Pampered Pooch Spa," which bathes and grooms dogs—at a premium price. The business is located in a well-maintained turn-of-the-century mansion in an expensive part of town. Because the local zoning rules will not allow Mary's business to keep business vehicles on the premises, she must rent a nearby building to garage these vehicles.

Although few people would expect a garage to be elegant, the continued success of Mary's business at least partially depends on projecting a "posh" image. So, she makes sure that the garage — at least from the outside — is attractively painted and kept up. Nothing that is connected with her business, including her business vehicles, is allowed to detract from her desired "upscale" image.

Conversely, if your business relies on low prices to beat out the competition, a luxurious facility may work to your disadvantage. Cost-conscious customers may feel that your prices couldn't possibly be all that low if you can spend big bucks on your facility. Some businesses that emphasize their low prices have had some success touting the fact that their stores are barren, cheap-looking, or in low-rent, out-of-the-way areas.

Your decision comes down to this question: What kind of statement do you want your facility to make about your business? For most small businesses, the answer will probably be somewhere between the pricey mansion, on one hand, and the "boy-is-our-store-ugly" facility, on the other. Put yourself in your customers' shoes. As a potential consumer of your company's products or services, what kind of facility would make you want to step inside to do business?

Quality of Life Issues

It's natural that most of the questions you will ask yourself about business location will be based on dollars-and-cents considerations. But part of the lure of business ownership is the ability to control not only how much you make, but how you make it. If you are like most small business owners, you can expect to spend a large chunk of your waking hours at your business facility. Quality of life issues are as relevant to the facility choice as you wish to make them.

If you have a choice of locating the facility in several different locations, which of them would you rather spend that much time in? Do you value being able to go to cultural events in the city or neighborhood right after work, or do you crave the fresh air of a country setting? How long are the commuting times between your home and the various choices? If one facility is in a place where you really don't want to be, but it appears to be the best choice from the point of view of business efficiency and profitability, would you be prepared to sacrifice some profit to obtain your desired business lifestyle? If so, how much? Only you can answer these questions.

Meeting Facility Needs Economically Ideally With Room to Grow

All things being equal, a business facility that can accommodate potential future growth would be more attractive than one that does not. However, realistically, all things are rarely equal. If one facility offers more room, you can expect to pay for it some way: in price, location, or other terms or features. If this is true, does it make sense to pay now for the benefit of easy expansion later? It may, but only if you reasonably believe (not just hope) that you will need the extra space in the not-too-distant future and that any additional costs that go along with this extra space will not be an undue drag on current business growth.

When faced with the question of paying more now for additional space that would be useful only if the business expands, some brash entrepreneurs would say: "Think big — then make it happen." Others would advise against this, saying: "Spend wisely now and put the money to current use." The weight of authority would seem to be with the more conservative approach. Most small business advisers suggest that start-up businesses keep a tight rein on costs. Business plans can be put together that envision additional facility requirements, but actually acquiring the additional space should probably be put on hold until business activity and profits justify taking on the added expense.

Fulfilling Space Needs Economically

So how do you make a facility choice that allows you to efficiently carry out the necessary functions of your business, presents the business in a good light, and allows for growth potential and fulfill all these needs economically?

Renting or purchasing your facility at the best price possible helps you avoid misspending facility dollars. If you overspend, your business may be at a lasting disadvantage. The misspent facility dollars will be a drag on your company's profitability, which can have several effects. In the all-important start-up phase, which is when most facility choices are made and budgets are the tightest, these dollars won't be there for other needed expenses. Also, overspending on the facility will make your company's profit and loss statement less attractive, which can make it more difficult for the business to borrow money.

How do you determining if the price is right for a particular property? An independent real estate appraiser with a good knowledge of business property in the area could be a help. But don't forget that there are really two separate "price" issues here. The first is what is the property worth on the open market. The second — and most important for you — is what can you afford to pay for the property, considering your evaluation of your business's profit potential. The commercial real estate broker can help you with the first question; you'll have to wrestle with the second one.

Here are some ideas for saving facility dollars, particularly if you're in the start-up or early childhood of your business:

Start out at home. Some types of businesses can be started out of and run from the home at least on a small scale. If your proposed business is one of them, you may want to try this. Operating a home business can help you to learn the business and build up a core of customers before you commit yourself to the overhead costs of a separate facility.
Share space. Certain start-up businesses (for example, service providers, such as accountants) are able to keep down their overhead expenses by sharing space and other services with like businesses. While these arrangements need not end as the start-up phase ends, with time, one or more of the businesses may require a disproportionate share of the space and services, or may outgrow the office altogether.
Locate within a business incubator. Business incubators are groups (run either as private, for-profit organizations, or as not-for-profit groups) that are designed to help small businesses survive and succeed through the start-up phase of their existence. Business incubators go several steps beyond the idea of shared space and office services; they also provide management and financial assistance. Although incubators have shown themselves to greatly improve a start-up business's chances of success, not all types of businesses benefit equally from incubators. Because incubators are usually located in low-rent, often out-of-the-way facilities, they tend to work best when your business does not need to be at a particular location in order to draw in-store customers.