6 essential factors to consider when relocating a business

Young business people thinking about factors to consider when relocating a business

If you’re considering relocating a business, there are many factors that may be driving your decision. It could be that the new area will bring more opportunity and trade. Perhaps you need a larger area of operations as your business grows. Or, on the other hand, you might be slowing down in a move towards downsizing your business.

Whatever the reason for relocating there are many factors influencing business location, which need to be considered, and this blog will guide you through the process.

Why relocate a business?

As we just mentioned, businesses contemplate relocation for various reasons, ranging from accessing new markets and expanding operations to scaling down for efficiency.

Since the pandemic interfered with working life, the discussion around moving offices has changed course: pre-2020, global business was praising bigger and better offices, but now companies are exploring new avenues with office spaces that cater to more flexible working practices. With over 40% of companies reporting that they have shifted to a hybrid working model, the importance of a suitable office location can’t be overstated.

Regardless of the motive or the model, the decision to relocate should be driven by a comprehensive understanding of the factors shaping the business environment in the chosen location.

businessman standing by a stack of boxes as workers are relocating a business

6 factors influencing business location

At the end of the day, the purpose of your business is to make a profit  – you don’t want to relocate somewhere that could have a detrimental effect on your business’s returns. This is why you should consider all possible factors when relocating your business.

As you will likely know, the further you move your business, the more it will cost; you need to consider the long-term financial impacts of relocating. But there are other factors too! To pursue a smooth transition and sustainable success consider the following aspects.

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  1. Tax environment
  2. Overhead costs
  3. Hidden costs
  4. Expansion opportunities
  5. Customer impact
  6. Logistics

Tax environment

When deciding upon a new city, county, or country you need to research its unique tax situation and how this can affect your business. The taxes in different locations could have a significant effect on your business’s profitability. However, that’s not to say the significant effect will be negative on profits!

Some businesses can receive tax credits for having offices in different areas, so if you are planning on moving a section of the business you might have to speak to your CPA and see if your business will qualify for this.

Now, taxes are complicated, and we don’t expect you to be an expert. It’s imperative that you consult with your CPA or CTS because the basic tax percentages don’t always tell the full story. A CPA will help you identify hidden costs and develop a strategy to pay less tax by using loopholes in the tax code.

Overhead costs

If you are moving, then the overheads of your new location are going to undergo a significant shift. It may not be an issue if you are expanding and moving somewhere bigger – naturally, your overheads will increase – but you will need to tread carefully.

Make sure that you are not shooting yourself in the foot. In other words, ensure that these new overhead costs are affordable and align with your overall budgetary constraints and risk tolerance. This goes well beyond the physical move; consider all associated costs such as the lease or mortgage payments, utility bills, shipping and potential wage increases for new employees etc.

Once you are clued up on all the new overhead costs in addition to the raw cost of moving offices, you can then compare the total financial outlay with the expected benefits from your relocation. This will help you make an informed decision as to whether a relocation is the right thing to do.

Hidden Costs

Relocating a business not only involves visible expenses but also harbours hidden costs that can catch businesses off guard. For one, there is the chance that not all your current employees will be willing to move; however, that is assuming you have a business that requires a lot of staff. Of course, with new hires, onboarding and offboarding there is an associated price tag.

The price of hiring and retaining staff is an unseen cost that could have additional hidden costs attached to it. New staff will need an adjustment period before they can be fully self-sufficient, this could bring below-average performance and be a financial loss to the business.

Dilapidation costs and reinstating the vacated office space further contribute to the overall expenditure, making it imperative to account for these hidden costs comprehensively.

three managers discussing factors to consider when relocating a business

Expansion opportunities

Is your business going to thrive in this new location? This is a vital question which should be a confident yes. Make sure the number make sense and the forecasts look promising.

To determine the business expansion, you have to look at your long-term goals and determine if this new location can sustain the forecasted expansion.

An example would be: if you predict you are going to need 40 new employees, will your new location be able to cater for 40 additional staff who may require a desk, IT equipment, meeting rooms and more?

You need to calculate how much office space you are going to need and ensure your new location can cater for this. You need to also ensure your new location has a healthy population of people who work within your specialised field or industry. This will make expansion easier as there will be more people to hire. If the local population cannot support the growth, then this can become a problem as you may have to spend money on moving again.

Customer impact

A lot of today’s businesses contact their customers online and therefore they can function from anywhere within the country. Although, saying that, it is still good for a business to consider the effects of relocation on your existing customer base.

Researching where your customer base is saturated could be useful in deciding where to relocate to. Businesses should move closer to their customers unless they seek to target a new area or otherwise increase their overall presence nationwide.

Having a presence in your customers’ vicinity helps to make a bigger impact on the community and continue to grow sustainably within that area. If your business relies heavily upon a few customers, then you need to carefully consider the impact if you are moving further away from them.


Your final factors to consider when relocating a business will revolve around the actual office relocation. That’s not to say that the moving shouldn’t be an afterthought. Conversely, it needs to be planned properly to ensure minimal disruption to the business operations and profits.

Your new office could need some refurbishment, which can cost a lot if there is a lot of work to do, so factor this into the overall moving costs. Furniture is another cost to consider as you may need to buy new pieces for your office unless it is already furnished. Sometimes moving some of the leased equipment violates the warrant so make sure you sort this out before moving them.

If you make a checklist of all items that need to be moved this can help you to plan for what needs moving, making sure you don’t forget anything. It will also help you to get an accurate moving quotation from a moving company.

To wrap things up

By now it should be obvious that the decision to relocate your business is a multifaceted one, influenced by a myriad of factors that span financial, operational, and strategic considerations. From navigating tax and overhead costs to unravelling hidden expenses associated with workforce transitions, each element requires careful scrutiny to ensure a seamless and successful move.

At VanaMango, we understand the intricacies of business relocation and our comprehensive services are designed to guide you through every step of the process, with our user-friendly booking portal and friendly customer service.

Don’t navigate the complexities of relocation alone – trust VanaMango to be your partner in achieving the seamless and prosperous transition you always envisioned.