Two units, four hundred yards apart in the same market town. The first is £18,000 a year on the main parade between a baker and a bank. The second is £9,500 a year on a side street with parking outside. The second one has been empty for fourteen months.
It is tempting to treat that as a bargain nobody else noticed. It almost never is. Empty units on decent streets in Britain are usually empty for a reason that will still be true after you sign.
Count the footfall yourself, on the days that matter
Agents quote footfall figures. Councils publish them for high streets. Neither tells you what you need, which is how many people pass your specific door, at what times, going where.
Stand outside and count. Not once. A Tuesday morning, a Thursday afternoon, a Saturday lunchtime, and a weekday around five. Use a tally counter or your phone, count for fifteen minutes at the top of the hour, and multiply. It is tedious and it is the single most useful hour of research you will do.
While counting, watch the direction of travel. Footfall on a street between a car park and a supermarket is people going somewhere with a purpose, walking quickly, carrying nothing on the way in and bags on the way out. Footfall outside a cinema at seven o'clock is people with time. These are different populations and they buy different things.
Then work out your conversion honestly. A convenience shop might convert a few per cent of passers-by. A jeweller converts a fraction of a per cent. Multiply your count by a conservative rate and by your average transaction value, and see whether the number pays the rent, the rates, the staff and you. Do it twice, once pessimistically. If the pessimistic version does not work, the site does not work.
High street, retail park and back street are three different businesses
They are not points on a scale of expensiveness. They serve different trades.
- A high street or town centre parade gives you passing trade, competitor proximity, which for some trades is an advantage because it creates a destination, high rent and business rates, no parking, and restricted delivery access. It suits impulse purchases and short visits.
- A retail park or edge-of-town unit gives you parking, larger floorplates, lower rent per square foot, poor passing trade on foot, and customers who came deliberately. It suits bulky goods, gyms, trade counters and anything where people arrive by car with a plan.
- A back street or upper floor gives you cheap space and effectively zero passing trade. It suits businesses whose customers find them online or by referral: workshops, studios, therapists, accountants, anything booked in advance.
The error is putting a business that needs passing trade into a location priced for a business that does not. The side street unit at £9,500 is excellent value for a picture framer with a website. It will kill a sandwich shop.
Catchment is a number you can look up
Your catchment is the population that can realistically reach you, and it is bounded by drive time more often than distance. For most retail, a ten-minute drive or a ten-minute walk is the meaningful boundary.
The Office for National Statistics publishes census data by small area, including population, age structure, household composition, car ownership and occupation. You can pull the profile for the output areas around a site for nothing. If your business needs families with children and the catchment is retired couples and student flats, the rent is irrelevant.
Look at what is already there, too. Competitors are information: three barbers on one street means the street supports barbers, and a fourth may still work. Nothing of your kind for two miles can mean an opportunity or can mean somebody already tried.
Check the vacancy rate on the street. A parade with two empty units out of twenty is healthy. One with seven is a street where footfall is falling, and your landlord's willingness to negotiate is not generosity.
The things that stop you after you have signed
Planning is the big one. In England, the Town and Country Planning (Use Classes) Order 1987 was substantially amended in September 2020, creating Class E, which covers shops, cafés and restaurants, offices, light industrial, gyms, nurseries and health facilities. Movement within Class E does not require planning permission, which is a genuine simplification. But pubs, takeaways, betting shops, cinemas and nightclubs sit outside it in sui generis, so converting a Class E unit to a hot food takeaway does need permission and is frequently refused on amenity grounds. Scotland, Wales and Northern Ireland have their own use class systems.
Then the practical checks that people skip: is there three-phase power if you need it, and what does an upgrade cost from the distribution network operator; can a delivery vehicle actually stop outside, or is the loading bay restricted; what is the rateable value on the Valuation Office Agency listing, and does it put you above or below the small business rate relief thresholds; is the building listed or in a conservation area, which governs your signage and shopfront; what does the Energy Performance Certificate say, given the minimum energy efficiency standards that apply to commercial lettings; and what is the state of the roof, given that most commercial leases are full repairing and insuring and the roof becomes your problem the day you take it.
Ask the landlord for the last three years of service charge accounts if there is a service charge. Ask the neighbouring tenants what trade is like. They will tell you, because they have nothing to gain by lying and they would like a neighbour who survives.
Where this shows up in the game
Business Baron has fifty towns and cities, and within each one the sites differ by footfall, catchment and rent rather than by a single quality score. A cheap unit really is cheap for a reason, and you find out which reason in your first quarter of trading. Some trades thrive where others cannot cover the rates. You can open in the wrong place in the free game and learn what that feels like before doing it with your own money.