You have decided to take the plunge and open your own business. Now comes the tricky part: finding the best spot for your new establishment. Before signing that lease, take a few moments to decide if a spot is the best match for your business needs.

1. Understand the the total rental costs for potential locations.

It is important to realize that commercial rental costs differ from personal rental expenses. When you rent a personal dwelling, the rent generally covers everything and stays the same for the term of the lease.

Business rent may consist of a fixed monthly amount in addition to variable operating expenses for the space (such as maintenance of the exterior). Some landlords require business tenants to pay a percentage of their profits as a part of their rent.

Whatever your rental agreement, make sure you fully understand it so that you can accurately forecast your expenses.

2. Look for spots within your budget.

Before you start browsing for spots, try to come up with a budget that you want to stick to. Being a new retailer, it can be difficult to know what you can afford since you are unsure what your sales will be.

Do your research to come up with an accurate sales forecast. On average, the rental costs for a retailer are 2.74 percent of the sales receipts. This amount does vary based on the type of shop you are running.

When selecting a spot for your store, it is important to select a location that is large enough to do business, but small enough to remain affordable. It is not financially prudent to pick a larger spot if it doesn't increase your sales enough to offset the extra costs.

3. Pick the right location.

The best spot for your shop depends on the type of traffic you want to attract.

For example, if you plan on opening a downtown bakery with a lot of pedestrians, it makes sense to search for a locale that is conducive to walking.

If you want to appeal to individuals who will drive to your business, make sure to pick a spot that is easy access and has adequate parking.

4. Consider how much space is usable.

Make sure to evaluate the layout of possible sites for your business. If the site has an awkward layout, portions may be unusable for you to display your products.

You may find that you can take a tiny nook into a desk space. Evaluate the needs of your business, including administrative tasks, when determining the feasibility of the site's layout.

By selecting a desirable spot for your business, you are on your way to becoming a successful small business owner.

For commercial real estate, contact a company such as Colton Commercial. 

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