By Michelle Stockman/ Arkansas Capital Corporation, Fayetteville

Businesses come in all shapes and sizes, start in a wide variety of locations, and display the creativity of the entrepreneur in many ways. Finding the space to call the business home has many options, and many potential problems, for the entrepreneur. What may seem like an easy task often becomes a nightmare if proper caution is not taken.

The obvious first step is to decide on the needs of the business. What type of business, how many square feet are needed, where should the business be located, what are some of the infrastructure needs? Would it be beneficial for the business to purchase land and build, should it lease a space, or can it be operated from home?

Once a shopping list of needs for the business has been developed, the entrepreneur can begin to search for a commercial real estate agent or strike out independently to look for space. As with shopping for a home, searching for the ideal location to house your business may take some time.

Once the location is found, entrepreneurs should enter into negotiations either with the land/building owner or lease agent. All things in business are negotiable, so the entrepreneur needs to stay strong. The other side is working hard to get as much as they can. Owners or agents will say or do things that will put the fear of losing the location into the shopper, because they think they have you in a vulnerable position. However, business success depends on the entrepreneur to settle on the right terms and conditions for the business.

Once the lease or purchase contracts are drawn up, the business owner needs to take the necessary time to thoroughly read through the legal documents. Understand what the terms are for both parties. If this is a lease, understand how long the lease is and what is needed to exit the lease. Additionally, if the landlord of the property does not execute leases, understand your legal rights before making any agreements. I would also recommend the business owner not to enter a building without a written contract/lease on the space.

In purchasing land and/or the building, the business owner needs to engage in due diligence on the property before signing purchase agreements. Where a business lives is another important step to consider for the health and viability of the business. The more you understand your needs and rights, the more likely your business will thrive in its location.

From Biz2Biz NWA, March 2010

By Michelle Stockman/ Arkansas Capital Corporation, Fayetteville: Michelle Stockman works with Little Rock-based Arkansas Capital Corp. to promote entrepreneurship development in Northwest Arkansas and around the state. She successfully implemented the first statewide entrepreneurship development system in North Carolina, and has opened Arkansas’ first community entrepreneurship center. Email Michelle at mstockman@arcapital.com.