4 Worst Business Relocation Mistakes | How To Avoid Them

Relocating a business can be one of the most significant decisions business owners make.  While a move can increase operational efficiency and improve market access, if not executed properly, it can also dramatically disrupt operations and, by extension, profitability. 

In this article, we’ll discuss four of the worst business relocation mistakes owners can make - and how to avoid them.

Relocation Mistake 1: Poor Business Needs Analysis

It may seem obvious that, prior to relocating, you have a solid grasp of how much and what type of space your business actually needs.  But, not truly understanding needs is an unfortunately common mistake businesses make.

Not conducting a proper commercial real estate needs analysis before relocating is like pulling your car out of the driveway and, once in the middle of traffic, asking yourself where should I go now?  It just doesn't make sense, and this lack of planning is a surefire way to set yourself up for failure.

Numerous considerations go into a commercial real estate needs assessment.  Square footage, floor plans, property type, proximity to target markets, required transportation infrastructure, and municipal zoning are just some of the considerations that businesses need to factor into a relocation. 

Failing to properly conduct this sort of needs assessment will inevitably lead to, at best, an inefficient relocation, and, at worst, a complete disruption of operations.   

Numerous considerations exist for commercial tenants looking to relocate, so please drop us a note for help with a needs assessment and market analysis.

Relocation Mistake 2: Not Understanding Your Current Lease Situation

Similar to the first mistake, not understanding your current lease is an all-too common - and completely avoidable - mistake businesses make prior to relocating.  And, when commercial leases are 3, 5, or up to 10 years long, it’s understandable that the details may become foggy after a while. 

However, not understanding the expiration and notification timelines of your current lease can derail a relocation plan before it begins.

It seems obvious, but businesses need to know when their current lease actually terminates prior to planning a relocation.  And, related to this, commercial leases have very specific notification requirements and timelines for a tenant who does not want to renew a lease for a subsequent term. 

A commercial real estate professional can help you to understand exactly what steps you need to take to comply with the terms of your current lease.  The negative alternatives are hefty charges, potential legal action for breach of contract, or, just not being able to execute your relocation plan. 

Relocation Mistake 3: Moving without Professional Help

Another common mistake involves a false comparison many businesses make.  Specifically, people think: I moved houses or apartments without a realtor, so I don’t need professional help with a business relocation, either. 

This is just an inaccurate conclusion, as commercial real estate is far different - and more complicated - than its residential counterpart.  Simply put, there are far too many compelling reasons to work with a commercial real estate professional when relocating your business to not do so. 

From local market knowledge to professional experience to familiarity with key landlord personalities, real estate professionals will provide you the insight - and leverage - to find a property that best fits your business’s relocation needs.

And, another great part of working with a commercial real estate professional for businesses?  The property owners, not you, pay the commissions!

Need recommendations on local commercial real estate professionals? Drop us a note!

Relocation Mistake 4: Starting the Process Too Late

This is another easily avoided - though frequent - mistake businesses make during the relocation process.  If you ask most real estate professionals, they’ll recommend between a 6-month to 1-year lead time to begin the relocation process.

Once again, relocating commercial spaces is far more complicated than residential moves.  From build-out requirements to construction coordination with contractors to commercial space availability, in general, a commercial relocation is not a quick process.

By waiting until the eleventh hour to begin a commercial relocation, businesses:

●      Reduce their negotiating power;

●      Limit their pool of available commercial spaces;

●      Are forced to take unnecessary shortcuts; and

●      Self-inflict an enormous amount of avoidable stress from rushing a complicated process

Bottom line, starting the process late will likely make a business need to settle for a less-than-desirable property.  For such an operationally significant undertaking as a relocation, this is not the outcome businesses want. 

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We recognize that, even after outlining the above information, tackling the challenges of a business relocation can seem daunting.   

That’s why we’re here to help.  The Pocket Broker team lives and breathes commercial real estate, so drop us a note to see how we can help you achieve your unique objectives!