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How to choose the perfect location for your franchise

Choosing the perfect location for your franchise can make or break it's success. In this article, we look at the key factors you should consider when picking a location, and why it's so important.

If you’ve decided to invest in a franchise, one of the most important decisions you’ll need to make next is choosing the location where you want to operate. In this article, we’ll walk you through the most important factors you need to consider, and help you choose the perfect location to set you up for future success.

Why is it important to choose the right location?

Selecting a franchise location goes beyond mere geography. It's a strategic decision that significantly influences your franchise's operational effectiveness and market reach.

The choice of location is pivotal in dictating the volume of customer traffic, enhancing the visibility of your franchise brand and ensuring easy access for your clientele. Insights from our guide to choosing a franchise show that the ideal franchise location can propel a business to success. At the same time, an unsuitable one might lead to challenges in gaining a market foothold.

The goal is to identify a site that not only meets your operational requirements but also resonates effectively with your target demographic. A strategically chosen location can boost your franchise's brand presence, draw in a steady stream of customers, and play a vital role in driving the growth and success of your business.

As you embark on this key aspect of franchise planning, it's important to focus on specific criteria that will inform your choice. These criteria include analysing local market trends, understanding the needs and preferences of your target demographic, evaluating competitive presence in the area and considering the financial implications of different location options.

What factors should I consider when choosing a location?

1. Demographics

Understanding the demographics of your potential franchise location is crucial in defining your customer base. This involves a detailed analysis of the local population's age, income, lifestyle and spending habits. Such demographic data is essential for tailoring your franchise to meet the community's specific needs.

For instance, a franchise specializing in luxury goods might focus on areas with higher income levels to match their target market's purchasing power. Conversely, a budget-friendly franchise could seek locations with a broader economic demographic to appeal to a wider customer base. This strategic alignment with local demographics is more than just attracting customers; it's about attracting the right customers.

Effectively aligning your franchise with the local demographics can significantly impact your customer base, sales and overall profitability. It's a key factor in the potential success of your franchise.

2. Target Market

Identifying and aligning with your target market's preferences is vital when selecting a franchise location. It's about deeply understanding who your customers are and what they seek. For example, a franchise aimed at young families may thrive in a suburban setting — close to schools and family-oriented amenities — while a franchise targeting professionals could excel in a bustling city center or a busy business district.

Our blog on the top 10 best franchises in Australia provides valuable insights into how successful franchises have strategically matched their locations with their target market's preferences. This careful alignment ensures your franchise is situated where demand for your offerings is high, thereby increasing the likelihood of your business's success.

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3. Costs

Managing the costs associated with your franchise location is a critical factor to take into consideration. Key expenses to consider include rent, utilities, renovation costs and other associated expenses. These costs need to be carefully weighed against the potential revenue the location can generate.

A prime, high-cost location may attract more customers, but it's critical to ensure that the increased revenue can justify these higher expenses. Conversely, a more affordable location might see lower foot traffic, necessitating extra marketing efforts to draw in customers. The decision hinges on a cost-benefit analysis — determining whether a location's potential for profit aligns with the investment required. This careful financial planning is essential in choosing a location that fits your budget and contributes to your franchise's overall success and growth.

4. Accessibility

Accessibility is a key factor in drawing customers to your franchise. It's important to assess how easily customers can reach your location, considering aspects like public transport links, parking availability and the store's overall visibility. A location that is well-connected by various transport modes and offers ample parking can significantly boost foot traffic.

Visibility plays an important role as well; your franchise needs to be easily noticeable and prominent. Opting for locations near major roads, in bustling shopping areas, or in high foot traffic zones can enhance visibility. The more accessible and visible your franchise, the higher the likelihood of customer visits, which can lead to increased sales and contribute to the success of your franchise.

Choose your franchise location carefully

Selecting the right franchise location involves thinking about several important factors and making a well-informed decision. From understanding the local demographics to balancing costs and ensuring accessibility, each element plays a major role in the success of your franchise. By applying these strategies, you can make better decisions that bolster the potential of your venture.

For further guidance on navigating the complexities of franchise ownership, explore the essential steps to buying a franchise. This resource offers valuable insights and tips to help you on your franchising journey.


Q: How do I choose the best location for my franchise?

A: Consider factors like local demographics, target market preferences, costs and accessibility. It's about finding a location that aligns with your business goals and customer needs.

Q: What should I consider in the decision-making process for a franchise location?

A: Evaluate the potential customer base, accessibility, visibility and costs associated with the location. Also, consider how the location fits with your brand image and franchise model.

Q: What are common mistakes to avoid in selecting a franchise location?

A: Common mistakes include not thoroughly researching the local market, underestimating costs and choosing a location based solely on price without considering other critical factors.

Q: How does the franchising code impact my franchise agreement in Australia?

A: The franchising code in Australia dictates key aspects of the franchise agreement, including location and territory rights, ensuring transparency and compliance in the franchise network.

Q: Can leveraging social media boost my franchise's success in a specific location?

A: Yes, effectively using social media can enhance brand awareness and attract potential customers to your franchise, impacting its success in any given location.

Q: What should I consider for site selection in urban areas like Sydney?

A: In urban areas like Sydney, consider local real estate trends, foot traffic and competition when selecting a site, ensuring alignment with your franchise brand and target market.

Stuart Wood

About the author

Stuart is Editorial Manager at He has worked as Editor for a B2B publisher, Content Manager for a PR firm, and most recently as a Copywriter for Barclays.