Property, one of many ingredients

A successful mix

Property is one of the many parts which contributes to the successful running of a business, however what is it the most important element?

As property professionals we like to believe that from bricks and mortar flows business decisions, but this is perhaps wishful thinking. If you consider what makes a business work and profitable, it has three key elements: the property, the people and the “business /trade “.

Different sectors works on different key elements.

The retail sector for instance relies on two key ingredients, being located in a strong trading position, with a high foot fall, that is a position which has lots of people walking past, and a strong brand name. The right location can make a huge difference to how a retailer trades, and so property is an important element. But that isn’t to say niche businesses require prime locations, infact many thrive in secondary position because of their client service and the quality of the offer. But on balance the location is highly important, especially to national retailers.

With warehousing, location again is key. This time however proximity to road and rail infrastructure is the man driver. The building needs to provide the required volume for storage, and be accessible. The building here is the most important element to the business.

Industrial processes rely on different elements to make them profitable, with property being just one part. Other important requirements are; a skilled work force, raw materials and suitable power supply-with this becoming ever more important. In this sector buildings can be adopted to become suitable, providing the other elements are in place.

Office based businesses are perhaps the most difficult to quantify, in what is most important. Having an available office in a particular location, of the right size doesn’t necessarily make it suitable for companies looking to expand or re-locate to that particular region. Where staff are the main ingredient of a business, they are undoubtedly one of the reasons a business locates to a specific area. Therefore correctly qualified and trained personnel have to be available along with the property. Norwich has a recent history of providing call centre staff, for the likes of Norwich Union, Marsh and Central Trust. The availability of these personnel is one of the driving factors for these businesses. Prior to call centers Norwich was a hive of activity in shoe making. In Cambridge, Nano technology and Hi-tech business have evolved not because the property was available, but because of the intellectual property which has been driven by the Universities and the technologies that they invent. Likewise Norwich now has a cluster of businesses based around food technology and environmental sciences, off the back of the UEA and the skilled workforce.

So on balance property is just one of the reasons why a business locates to a particular location, it is important but not always pivotal.

Sam Kingston

Date Added: February 6th 2008