Is Location Still Important for a Business?
Choosing your business’s location determines everything: Whom you sell to. Whom you can hire. The vendors you can work with.
When I first started my accounting software and payroll company, my location was a shocker to many. I set up shop in the heart of Canton, Ohio, while most tech companies are located in Silicon Valley.
But, that’s the beauty of technology. My company can provide software to businesses nationwide and hire employees from all over the country. That’s why choosing a business location might not be the be-all and end-all anymore.
4 location-based concerns that the digital transformation solves
The so-called digital transformation has been years in the making. Not to mention, the Covid pandemic shed more light on the importance of taking things digital.
For example, in June 2020, only 26% of people were working on their business premises; 42% were remote (the remaining ~33% were not working). It’s clear that location is becoming less of an issue for individuals and businesses nationwide.
Here are four location-based concerns the digital transformation might solve:
1. Talent concerns
Sometimes, hiring talented folks is like looking for a needle in a haystack. And then when you finally find and hire that person, they turn around and move to another state (cue the vicious cycle).
Some positions are just harder to fill than others. Why? It could be because fewer people with those skills are located in the area.
Depending on your business, the position you’re hiring for, and your industry, you might be able to fix talent concerns through remote work and expand your talent pool to include people in other areas. And by making things digital, you may also be able to retain a current employee who’s thinking about moving out-of-state.
Thanks to my company's business model, I have been able to retain some of my top coworkers who moved out of state over the years. And post-pandemic, we’ve started those who are out-of-state off the bat. We currently have employees in over nine states.
For many businesses, worries like Am I going to be able to find talent here? Do I need to settle when hiring? are becoming less of an issue, thanks to the growth of remote work.
2. Narrow audience
When you start a business, you conduct market research to figure out who your target audience is. These are the people you sell your products or provide services to. Generally, you need specifics about your customers, like their age, income, gender, and location. After all, your customers are limited to the people near your business’s brick-and-mortar, right?
Thanks to the ongoing digital transformation, your target audience’s location might not be much of an issue anymore. Before the rise of online shopping, shipping products to consumers on the other side of the country was a bit more difficult. Now there are predictions that e-commerce sales should reach $6.8 trillion in 2025.
But, don’t just take the projection’s word for it. The first quarter in 2024 saw 15.9% of all retail sales taking place online (non-adjusted), an 8.6% increase from the same quarter the year before. The beauty of this rise in online sales is that depending on your business, you might not need to limit your target audience to their location any longer.
3. Vendor limitations
Feel like you’re limited to using suppliers and services that are near your business’s headquarters? Thanks to this digital transformation, this location woe may no longer be an issue.
When it comes to choosing suppliers, you don’t necessarily have to limit yourself to your city, or even state. If possible, you might be able to choose vendors based solely on:
- Better prices
- Quality products
- Reliability
- Reputable customer service
But before you transfer all your vendors out-of-state, consider time frames. Sure, you can receive goods from around the country (and even globe), but how long will they take to arrive? Talk with vendors to learn more about their shipment times. And talk with vendors in your area to see if they’ll consider working with you on prices if it’s a cost issue.
4. Storefront worries
Choosing where your storefront is located has always been a big deal since it could impact how many customers come through the door. Before renting or buying a storefront, you probably were used to asking the following types of questions:
- Is the building in a good area?
- Where can customers park?
- How close am I to my competitors?
Now thanks to the digital transformation, for many businesses, location is no longer a concern, and some businesses are forgoing the physical business location altogether. You might even decide to conduct business out of your home (and claim the home office tax deduction for business owners).
RELATED: Retailers: Is Your E-Commerce Website Ready for a Sales Surge?
