Are you searching for the perfect location to open your ski rental shop? When you have a retail or rental shop your location can make or break your business. There are a lot of things to consider when deciding where to open up your shop, and choosing a “bad” space can end up costing your business in many ways.
Before you sign a lease agreement for that beautiful space in the trendiest retail shopping plaza (or the bargain basement steal with the monthly rent that’s too-good-to-be-true) take a moment to look for location red flags which may indicate future problems down the road.
Choosing a Business Location: Red Flags and Considerations for your Ski Rental Shop
State income taxes, sales taxes, and regulatory requirements can vary greatly. Before you commit to opening a business in your home state, be sure you understand how friendly it is towards entrepreneurs in general, and the outdoor industry in particular.
If you live near a state line, it’s even more important to consider the costs of opening a ski rental business in one or the other. For example, a California company may pay approximately 8.84% per year in corporate income tax, but that same company in Nevada may pay no corporate income tax, according to the Nevada Development Authority (NDA).
Location Red Flag: Opening your ski shop in a state with higher income tax, sales tax, and more regulatory requirements.
Be sure to understand your city and county taxes and regulations before deciding on a location. You may pay separate city/ county business taxes in addition to state business taxes. And different cities and counties will have various business regulations on the books, as well.
Areas which are business-friendly will have ample activity, with new shops opening and existing businesses thriving. But an area with high taxes and unreasonable regulations may reveal itself with an increasing number of businesses relocating or going out of business for good.
Location Red Flag: A region where businesses are fleeing, struggling, or closing for good.
If your business will be primarily renting ski, snowboard, and other winter sports equipment, proximity to a skiable and accessible mountain is obviously key to your success. But there are some other local factors to consider, as well.
What does the local economy look like? Ideally, you will set-up shop someplace with a strong economic base. Are there a variety of industries that drive the local economy, rather than one major industry? If one major company or industry is employing most of the town, there could be major implications for all businesses if that employer/ industry closed down or suffered a downturn.
Location Red Flag: A sluggish local economy or a community dependent on one major industry.
What’s the local unemployment rate? Is it on the rise? Higher unemployment rates and difficult economic times are often tied to increased crime rates. Take some time to understand your local area unemployment statistics. Small businesses are particularly vulnerable to crime, since they often lack the resources to have adequate crime prevention and detection measures in place. Burglaries, theft of merchandise and inventory, stolen cash, and even credit card fraud/identity theft could threaten your profitability and the success of your business.
Location Red Flag: High unemployment rates and increased criminal activity in the area.
Specific Location Considerations
Once you’ve given careful thought to the state, county, city and even community where your business can flourish, it’s time to pick a perfect spot. Since you never get a second chance to make a first impression, be sure to take some time to select a neighborhood, shopping center, and storefront that will support your business growth (rather than chase customers away).
- Are you in an area with plenty of foot traffic?
- What other businesses are nearby, and will they bring in more business for you?
- How much direct competition is nearby?
- Will you be the third (or fourth or fifth) ski-rental shop on the block, or the first and only?
- Is the location easy to find, and does it have ample parking for customers and employees?
The lease may be cheaper on a retail location that is off the beaten path, but if customers can’t easily find you, aren’t able to find parking, or are discouraged by other businesses, they may never get through your front door.
A highly desirable location may bring increased traffic and customer opportunities, but if you have a large amount of direct competition, you may want to reconsider.
Location Red Flag: No foot traffic or thriving complementary businesses close by; hard-to-find location without parking or accessibility, or too much direct competition.
Building Cost Considerations
Finally, be sure to calculate the total costs of your would-be location, like the costs of utilities. Be sure that your retail space has an updated infrastructure that accommodates electrical, heating/ air, and telecommunications systems. You don’t want to tie up all of your money in a lease only to find that the heater doesn’t work during the snowy winter months and have no cash left to fix it. Newer equipment and updated infrastructure can mean less money spent on repairs and maintenance. Older systems can also mean increased energy costs, as well.
Location Red Flag: Older buildings and systems that will need updating, repairs, and maintenance or that will increase utility costs.
When you’re ready to find the perfect spot for your ski rental business, it can be tempting to run out to the first log-cabin or ski-chalet-themed retail spot and sign a lease on the spot. But taking the time to carefully consider state, county, city, local community and even location specific factors can help your business win in the long run.