Location, Location, Location
Here are three questions I received recently at AskJim.biz from budding entrepreneurs like you. Take a look and see if they help. And remember, always seek excellence, not perfection.
Question: Could being a homebased business owner hinder my networking opportunities?
Answer: Your business's location shouldn't have a negative impact on your networking success. But when your business's size or condition limits your ability to respond to opportunities, that always influences how your network refers business to you.
Being homebased doesn't have the stigma it once had. With the rise in telecommuters, from entrepreneurs to corporate executives, most people now recognize the productivity and efficiency that can come from hombased operations. In a networking conversation, your business's location should merely be a detail that may or may not come up. Reveal this information about your business only when it's pertinent to the conversation.
Question: Recently I heard someone use the term above the line when discussing his business finances. What does that mean?
Answer: Above the line refers to the information found in the first of the two major sections of a P&L statement. The top section is identified as being above the line that separates gross profit elements (which are mostly variable, like sales) from operating expenses (which are typically less variable, like rent, payroll and insurance).
The P&L, also called the operating statement, primarily tracks monthly sales and expenses and their relationship to each other. Doing the math for this relationship produces gross profit above the line and net profit (or loss)--literally on the bottom line.
When you hear someone say "above the line," he or she is identifying gross profit and the financial elements that produce it.
Question: Where can I get help to make sure I start my new business in the best location?
Answer: Start with your chamber of commerce to see what they know about local real estate trends. You can also contact your industry trade group for guidance and search online for research about industry locations. The business school at the local college might have research on current and future traffic patterns. And you can talk with the city planner and local state highway engineer about proposed long-term road maintenance, route changes and other traffic issues.
Perform shoe-leather research by talking to noncompetitive business owners about the benefits and pitfalls of their location. Also, drive around on your own and observe consumer traffic.
Private market research firms can help as well, but their services aren't free. Before you try to get by on the cheap, however, remember that investing in success is always less expensive than the cost of failure.
Especially if you're in retail, remember the three classic rules of real estate: 1) location, 2) location, 3) location.