What Makes a Good Business Location? | IL

Starting a new business can be incredibly exciting and downright scary at the same time. In 2021, the state of Illinois had a 78.1 percent “survival rate” for new businesses. As of 2023, Illinois had the eighth-highest five-year business survival rate when compared to other states.

While Illinois may have better overall survival rates for new businesses than many other states, it remains true that across the United States, almost 90 percent of startup businesses will fail, with 3,200 startups going under in 2023. Businesses fail for many reasons, but one factor that consistently makes the top ten is business location.

If you fail to carefully research your choice of location, you could find yourself among those lamenting the demise of a business. Speak to a knowledgeable business law attorney from Gierach Law Firm who can provide you with the guidance you need in choosing your business’s location and in every other aspect of your business.

Practical Considerations When Choosing a New Business Location

The definition of a bad location can seem self-explanatory if your business relies on location for foot traffic, but it may not always be apparent. While you must consider your product or service in terms of the customer base you hope to reach, zoning ordinances may also factor into the type of business you can open in a given location.

A business like a daycare center or a dry-cleaning store is likely to do better in an urban business location. A plant nursery might do better in a more suburban location where more people have lawns. Once you have checked out the zoning ordinances of your proposed location or locations, you will also need to consider the following practical location concerns:

• The amount of the monthly or yearly rent or lease
• Parking availability for customers
•  Nearby businesses that are similar
• The degree of walking traffic
• Accessibility
• Any special physical requirements your business may need
• Demographics of your target audience
• Whether the location meets the needs of your distributors and suppliers, if applicable
• The location’s potential for growth
• Security

Legal Considerations When Choosing a New Business Location

A new business must be registered in almost every area, have all applicable licenses and permits, meet zoning requirements, and pay taxes. Whether you plan to buy, rent, build, or work out of your own home for your new business, you need to check local zoning requirements. Neighborhoods can be zoned as commercial, residential, or a mix of the two but zoning laws may restrict or even ban specific types of businesses in the area. Zoning ordinances apply to home-based businesses and are controlled at the local level, so check with your city planning office to determine what zoning laws apply to your chosen business location.  

If your business requires employees, you must check your area’s minimum wage laws, local business insurance rates, and government licensing and fees. Sales tax, property tax, and corporate tax rates can vary significantly from one area to another. Some states are known for creating tax environments that are friendly to specific types of businesses. State and local governments may offer special tax credits for some types of businesses, and the federal government offers benefits to small businesses that contract with the government and are located in underutilized areas (HUBZone Program).

Contact a Naperville, IL Business Formation Lawyer

It is essential for businesses that have a physical presence to choose the location wisely. When you choose Gierach Law Firm, you will reap all the benefits of having attorney Denice Gierach helping you through the business formation process. Denice combines her education as a lawyer, a CPA, her master’s degree in management, and her experience as a lawyer and business owner to create a unique approach to client service. When you choose a Naperville, IL business formation lawyer from Gierach Law Firm, you have taken an important first step to ensuring the success of your new business. Call 630-228-9413 today to schedule a meeting.