Taking a brief break from the questions for a day on brokers as like many writers, I’ve been lax about self promotion, and quite honestly suffering a bit from imposter syndrome. A dyslexic that’s a book writer? Yikes! My 10th grade English teacher is probably rolling in his grave right now.

Ah, the wonders of help like Grammarly and ProWritingAid plus a wonderful editor. Today’s inspiring conversation with a friend has helped to motivate me to pursue self-promotion a bit, trying to strike a happy medium between effective marketing and avoiding annoyance. I’ve never really had the need to self promote, although I do a killer elevator pitch/30 second commercial, so off we go………

This is Chapter Three from my book, Location? Location! Finding a Location for Your Brick and Mortar Business. How to Scout the Perfect Location for Your Dream of Opening a Brick and Mortar Business.

Wants Based VS Needs Based Businesses

One of the biggest questions that new businesses fail to ask is NOT whether there is an opportunity for a business in this location, but WHY isn’t there one or more businesses already located here?

Some questions to ask yourself before even going location hunting.

• Is this a new type of business?
• A new industry offering?
• Has someone already established it as a tried-and-true business type?
• Is this a fad that in two years, or five years, or more (or even less), could be irrelevant?

There is a long history of product launch failures, including two major soda brands with new products that didn’t fly; for example, the Arch Deluxe from McDonald’s, (upon which they spent millions of advertising dollars); Microsoft Zune among others. Those are product examples, but what about services, or service and products?

Think about how much times have changed. When I was a teenager, arcades were “in”. Now they are few and far between due to the rise of at home gaming systems.

What about video rental stores? Blockbuster didn’t move with the times to digital like Netflix did. RadioShack couldn’t end up competing with Amazon and Walmart. Borders Bookstores is another one that didn’t change with the times, but Barnes and Noble did, and they are still around.

While opening a coffee shop or clothing store will probably still be relevant in ten years, will a spa offering isolation/float tanks? Or a studio with custom backdrops, green screens and props so people can record more professional looking TikTok videos? Will TikTok even exist in 5 years (or next week)? If you buy into a franchise, what happens if the franchise goes under?

While there is no crystal ball to predict what can happen, map out several ‘worst case’ scenarios, and have a plan for what you might need to do before renting or buying a space. If you are a home-based business doing subscription boxes, the interest may trend for a few more years, but your business is at home and your overhead costs are minimal. If you are laying out money for a lease or mortgage, just so you can have space to package up boxes, can you tell yourself that this business is definitely going to be relevant a few years from now? If you’re not, I’d say, don’t NOT rent the space, but be prepared to pivot if consumer interest wanes.

Another question to ask yourself is WHY isn’t there already a business in the area in your niche industry? In many cases it’s because someone started one there and it failed because there wasn’t enough need for it, or the community couldn’t support it. Make sure you do your homework first. Google remembers everything and so do the locals. Ask around and do some online searches for the area.

An example here in New Hampshire was a small gym that opened up about 15 years ago. They spent a lot of money on the building and equipment and they limped along for about 3 years with very low membership. One of the top reasons they failed was they priced their membership too high for what they were offering. The second reason was they didn’t assess the community, which wasn’t really looking for a gym that offered little in the way of workout equipment in the first place. If they had built the building larger and put in a pool and asked the community what they were looking for in terms of equipment and other offerings, they might still be open. If they had lowered their rates significantly, they “might” have made it, but they were trying to recoup all of their startup costs as quickly as possible, and priced themselves out of the limited market they had to start with.

Another example is a high-end gift shop in a rural town that shut down after less than a year and a half. The storefront appeared to be situated close to a heavily traveled road, and during winter, many tourists would pass by it on their way to a popular ski area. It may have appeared to be an ideal location. A little investigation of the history of the town would have let them know prior to signing a lease on the building that in the past 15 years there were three other gift shops that also tried and failed within a three-mile radius, one of them in that same spot. So, before assuming that an area hasn’t had your type of business idea, take the time to investigate if someone has already attempted and failed in the past.

In chapter one, I bring up wants based vs needs based. A high-end gift shop is wants based, not needs based. People may come in a few times a year to buy presents for birthdays, anniversaries and holidays, but it’s not a reliable full-time revenue stream. Those tourists going back and forth to the ski area are not even a potential target market, they are full tilt ahead on the way to get to the slopes and then tired and just want to get home, or to a local place to stay after skiing all day. Why should they stop at a gift shop? On top of that, the town itself is primarily blue-collar workers. Buying a $200 cutting board isn’t something that is a typical purchase for the community.

This business “could” have potentially made it if they had a better website that was mobile friendly and easy to navigate and had an e-commerce option. Many of the items in this store were unique and there could have been a market online for their products. This business failed because they didn’t properly assess the community and their target market, AND they didn’t take advantage of the technology that could have helped them succeed.

An example of a needs-based business in a location where someone saw both opportunity and need is a small town in Vermont. Two laundromats are located within half a mile of each other in the town. The first laundromat opened in 2017 and the second about 3 years later. The town is mostly blue collar with a high population of renters who, considering both laundromats are fairly busy at most times they are open, probably don’t have laundry capabilities at their rentals. Someone saw a need and opened a business, and they both appear to be doing well.

A business owner I recently spoke with at a Chamber of Commerce event had an interesting take on business. Her business sells and services copiers and offers printing services. While in the future we may move to all digital, I suspect it’s going to be quite a while before everyone moves to online completely. There are still many households in this country who can’t afford or don’t have access to a computer.

The business owner said business was good, and even during the Covid pandemic, business continued to be steady. Her take on her company was that it would thrive through good times and bad. She said when the economy was good, businesses bought copiers and did their printing in house. When business was bad, they had their current copiers repaired when needed, and outsourced more of their print jobs.

It’s a good question to ask yourself. Is your business going to do well in every economy? And if it might not, how will you prepare to pivot or change products or services?

Consideration points for this chapter.

Is your business a Wants Based or Needs Based Business? (Circle One)

• Wants Based
• Needs Based
• A Combination of Wants Based and Needs Based

 

If you selected Wants Based, why do you consider it Wants Based?

 

If you selected needs based, why do you consider it needs based?

 

If you selected a combination of wants based and needs based, Why do you consider it a combination? Example: You have a dental practice. Necessary dental work like fillings and root canals are more needs based. Teeth whitening and crowns are wants based.

 

Notes: