The foundation of a successful business is built not just on brilliant ideas, but its physical footprints. If you’re an entrepreneur, choosing the right location for your business is one of the most challenging decisions you’ll ever make. From customer traffic and demand to operational restrictions and overheads, the right choice makes all the difference.
If you’re looking to choose a business location in Sharjah, you’ll find that you have multiple options – most broadly, between setting up a business in the mainland and free zone. To help you make the right decision, we’ve compiled a definitive location checklist for you to tick off when choosing a business location.
10 Factors to Consider When Choosing a Business Location
1. Target Market and Access to Customers
Your ideal location is where it’s easy for your customers to find you. For retail and service-based businesses, being close to your customers is essential. If you’re in a business where having a store or office is essential, make sure you’re ticking this box.
The UAE also has several free zones dedicated to specific sectors. For example, If you’re in the publishing industry, focus on a free zone like SPC Free Zone that offers extensive support for businesses in the industry.
· Action point: Conduct a market study. If you’re serving a local community, ensure the area’s demographics (income, age, lifestyle) align with your ideal customer profile.
2. Operational Costs and Budget
Beyond the cost of rents, a realistic budget assessment also needs to account for operational overheads, which can vary widely from location to location. If you’ve been writing up a Sharjah commercial property checklist, this is a particularly crucial element.
· Factors to budget for: Rent/lease costs, utility rates (electricity, water, and air conditioning), service charges, municipality charges, deposits, and taxes. Broadly, weigh the costs of a mainland business setup in contrast to a free zone.
3. Business Zoning Regulations and Compliance
Every location in the UAE, whether mainland or free zone, typically has specific zoning regulations that dictate what kind of businesses can operate there. If you ignore these rules, you can face fines and legal repercussions.
· Focus Areas: Do thorough research on business zoning regulations in Sharjah. Ensure your chosen space – whether commercial office or industrial warehouse is licensed for those specific activities. Each free zone has different governing rules, so it’s always important to be completely familiar with their regulations.
4. Infrastructure and Connectivity
Infrastructure is the nervous system of any successful economy, and the UAE offers world-class facilities in this respect. For modern businesses, this means more than highways, airports, and ports, it also includes reliable utilities, high-speed connectivity, and easy access to facilities
· Infrastructure checklist: Make sure you have easy access to high-speed internet and telecommunication services. Ensure that your office has ample parking for both employees and customers, and is close to major transportation links like highways and airports.
5. Proximity to Suppliers and Distribution Logistics
For businesses that deal with physical goods such as manufacturing, F&B, logistics, and retail, factors such as inventory, cost of transporting goods, and the associated timelines are critical to business success.
· Logistical edge: For logistics and trading companies in the UAE, being closer to Sharjah’s major shipping ports and industrial areas will drastically cut down on supply chain costs, inventory time, and delivery timelines.
6. Local Talent Pool and Workforce Availability
Your location should be attractive for the employees you’re looking to hire. This means that it should be easy for them to commute to your location via public transportation or a personal vehicle. Plus, it’s always a good idea to ensure that you’re not located too far from residential areas.
· Employee focus: Consider ease of commute. A location that supports a high quality of life for your employees, with nearby amenities like restaurants, banks, and good hospitals is a major benefit that few talk about.
7. Competition and Market Saturation
The best entrepreneurs don’t avoid competition. They study it. Too many competitors located near you, and you could be setting up shop in a saturated market. Too few competitors, and you have a chance to stand out – but alternatively, it could also mean there’s very little demand for what you’re selling.
· Market analysis: Evaluate your competitor’s strengths, weaknesses, and their office location. What’s the footfall and visibility of their location? Even if your location isn’t optimally located, how will you position your advertising to enable maximum more people visit?
8. Potential for Scalability
Don’t choose a place that only meets your current needs, because as you go up the ladder, your business may need to expand. Your location should accommodate for future growth, while trying to avoid the possibility of an expensive or disruptive dislocation too soon.
· Plan ahead: Search up flexible lease terms or find a property that offers adjacent units for potential rentals in the future. If necessary, read more UAE business setup location guides, consider setting up in a jurisdiction like SPC Free Zone where it’s easy to add business activities to your license and increase your visa quota.
9. Safety and Quality of Life
Of the 10 factors in choosing a business location, this one’s perhaps most important. The security of your employees and your assets are of paramount importance. Do your due diligence in this regard.
· Assess the area: Take a day out to understand the area and surroundings, its cleanliness, adjacent businesses, levels of surveillance, and general security measures (e.g., lighting, security services) of the commercial building and area.
10. Regulatory Environment and Business Support
Finally, the regulatory climate of your chosen jurisdiction is of central importance. Free zones in the UAE tend to have their own rules, and are thus usually perceived to be more liberal than mainland companies. However, free zone businesses do face certain restrictions when trading within the UAE mainland.
· Choose the right jurisdiction: Whether you proceed with a mainland entity regulated by the Sharjah’s Department of Economic Development and the Ministry of Human Resources and Emiratization; or a Free Zone such as SPC Free Zone which is governed by its own authority, understanding the regulatory benefits is vital. Conduct thorough research on the process, timelines, costs, and compliance requirements within your chosen jurisdiction before you start the process.
Choosing the right business location is ultimately one of the most important decisions you could make as an entrepreneur. We hope that this list of 10 factors to consider when choosing a business location helps you zero down on the perfect spot to start your new venture.
