Lets face it, 2021 has revolutionised how business is conducted. Digital transformation has been improved by a magnitude of years if not decades owing to the need to take businesses online. So, the question stand, in this day and age does it make sense to shell out a fortune on an office in a prime location? Well, honestly it depends. So lets figure out whether your business’s physical location plays a role in 2021.
Overview
The location of the startup is matter or not is depend on the fact whether the business is online or offline. Many of the points in this article that follow won’t make sense for certain kinds of businesses. Startup location and digital age are two different sides of the same coin. Both are equally important for the success of any start up. For example, CULT.FIT, it came into existence in 2016 and is based on fitness. Their goal is to keep one fit and healthy. Their offering includes fitness and yoga,
healthy meals, mental wellbeing and primary care. Anyone can remain healthy from their homes by just using their app. But they also have gyms in various cities.
So, if we talk about the app the location is something which doesn’t play any role here but if we talk about gyms then location is something which they cannot ignore because then it become one of the important factors which determine success along
with the digital marketing.
The Pandemic Shift
As mentioned before, the pandemic has caused a seismic shift in the way businesses operate, most businesses have transformed themselves in online mode, people are working from their homes. But if we notice one thing during this time business have seen a so much loss. This might be an indicator that location is still an important factor. Now in this digital era we can reach a large audience, can build a network across countries, also we can advertise conveniently. With the help of
blog, well-built website.
Social networking sites one can reach the large audience, however the location of the business is a different concept. In some of the startups both play a major role, in some location might not be an important factor and in some location might be a game changer for one.
The Specifics
Now, according to MCA norms, you must have a physical address tied to your business in order to be registered as a legal entity. Irrespective of the nature of your business, certain universal factors which do affect your business’s core fundamentals are dependent on the location of your office whether prime or not. Let’s look at three of the most important factors as such-
1. Networking:
Any person who has ever ran a business knows the age old adage, your network is your net worth. Location plays a huge role in networking and collaboration and this is truer in cases of new age lean model startups which are very dependent on assets and support from its parallel industries. This point is the easiest to illustrate and visualise, why do you think Silicon Valley is even called that? Simply because all the modern tech giants were born and brought up in that specific part of California, allowing them to collaborate and compete in close proximity.
India has been slowly but steadily warming up to the idea of SEZ or special economic zones which allow for concentrated pockets of industrial expertise, thus creating an ecosystem allowing startups and MSMEs to utilise and leverage the network thus created with ease and efficiency. So, if you are opening up say a deep tech startup, it makes no sense to set it up in the picturesque hillscapes of Himalayas.
2. Access To Resources:
Following the previous point, if you are to run a startup proficiently you cannot do it alone and definitely cannot do it with just the resources you started out with. One of the most important resource a startup needs without a doubt is the human resource. As you scale up, you will need individuals with domain expertise as well as generalists. Although generalists are somewhat freely available, specialists are often again concentrated in specific geographical constraints.
That somewhat depends on the educational institutions a place harbours as well. There’s a reason why Mumbai is known as the financial capital of India and correlating reasons why it hosts so many of India’s illustrious FinTech.
3. Where Is Your Client/Customer?
We saved the best for last, your client or customer is who your business is for, they keep the lights on and the fans running so its incredibly important that you in your market research understand where your customer lives, works, hangs out at, etc and set up shop there. This applies to purely online businesses as well, if you are a music label, of course you would not spend your time and energy growing on LinkedIn and conversely if you run a company which provides project management solutions, you won’t try to grow big on TikTok.
Therefore, it is becoming increasingly important to know and understand the overall position of the market and where you serve on and in it. Once you have that down to a science, you would know where to set up shop.
Parting Notes
It is true that the world and specifically the startup ecosystem runs at a breakneck speed, this has caused both problems and presented opportunities. The way one should look at it is accelerated natural selection because that’s what it is. In order to make it big in this saturated space one must understand the market and most important their offerings and how to best optimise and enhance the customer experience.
Overall, whether you are thinking about setting up an online shop or a brick and mortar store, it will depend on your business type and above all the market you are in. With that said, I would like to end with a quote from Abraham Lincoln which sums up not just how one should conduct themselves in business but in life overall-
If I am given 6 hours to cut a tree with an axe, I would spend 4 hours sharpening the blade.