When working with clients who need help with franchise location selection, we suggest they get as much data regarding their local market, including demographics and retail market conditions.
While most franchisors provide assistance with site selection, we recommend that our clients should conduct their own level of preliminary research. Not everyone is an expert in real estate, but there are some basic research steps that can be taken to provide a base level of understanding. This could prevent you from making the wrong choice, saving you thousands.
The first step we recommend is to get an understanding of what the “ideal customer” looks like for the franchise business in question. When you understand this, you’ll be able to better select a site that would cater to them. You can get this level of detail by directly asking the franchisor what demographics they are looking for when selecting a site for a location. These factors could be age, gender, household income, population, etc., and once you have these details, you can conduct your own research.
The online tool we suggest for this type of research is www.city-data.com. Per the site, they provide, “graphs of latest real estate prices and sales trends, recent home sales, home value estimator, hundreds of thousands of maps, satellite photos, stats about residents [race, income, ancestries, education, employment]”
Another area that should be researched is the local market conditions for retail space. You will need to know what the current lease rates are and the availability of the type of space that is needed. Once again, you’ll need to ask the franchisor what size, type and general location of what works for their brand. Factors to consider regarding size would be what range of square footage works best, and in regards to type would be “retail,” “office,” or “industrial.”
A great website we recommend is www.loopnet.com. You can enter the type and location and a listing of available properties are provided. With a free membership, you’ll be able to view listings. You will be able to get a feel for the price and availability of the type of space you’ll be targeting.
While most franchisors do provide site selection assistance, it’s a prudent idea to conduct some preliminary research on your own. Also, you could contact one of our franchise consultants to assist you in your search.