Starting a new business or buying an existing retail business is an exciting time. One of the first steps on your road to success is to make sure you can run the business where you plan to run it.
It's critical that you know and understand the zoning ordinances and regulations for the area where the business is located.
More Than Location
You've heard the saying, "Location, location, location." Yes, the location of your retail business may mean the difference between success and failure, so choose it carefully. You need to be where the where the customers are, and factors like state and local sales taxes, image, visibility, and accessibility for customers are important too.
Just as important, if not more so, are the zoning rules and requirements.
Zoning Laws: The Basics
Zoning laws or ordinances define and restrict how you can use your business property. Typically, zoning restricts land use by type of use, height of the structures on the property and position or location of the structures on the property.
How They're Made
Most often, zoning ordinances are made by your city or county government officials. Those officials, usually with the help of a planning commission, divide the community into districts, or zones. Then, land-use rules or regulations are made for each zone or district.
In most areas across the US, you'll find these basic types of zones:
As general rule, there's very little overlap in permissible land-use between zones. So, for example, you typically won't find a family home surrounded by factories and other industrial complexes.
Conditional & Special Uses
It's possible to get permission to run your business in a zone that normally doesn't allow retail businesses. This is done by applying for a special or conditional use permit from your local zoning commission or board. For instance, you may be allowed to run a small convenience store or boutique shop in a residential zone. Don't expect to get permission to open a large supermarket or department store in the same zone, though.
Also, be sure to see if the existing business you're thinking of buying is operating under a special use permit. You may be shut down by the zoning board if you break any terms or conditions of the permit, such as by expanding your building or parking lot, for example.
How to Find the Zoning Laws
Your local zoning commission can give you the latest mapping of the retail location and surrounding areas that you're considering.
Zoning Considerations to Think About
Here are some zoning related issues you may want to consider before you start or buy a retail business:
- Restrictions that may limit your operations. For instance, you may be able to open a convenience store but you may not be able to serve food and beverages in the store
- Restrictions on expanding your building or structure
- Construction or changes in traffic or new highways that may present barriers to your store
Home-based Retail Business
Although there are several benefits to running a business from home, including low overhead, no commute and technology options that make it easy to project a professional image, a retail business is one of the few businesses that's difficult to run from home. Problems arise from the conflict between needing customers to come to your place of business and the penalties of having customers visiting your home.
Most residential zoning excludes retail, so your neighbors can report you to city or county officials if your business creates noticeable traffic, noise or parking problems. Some communities bar commercial vehicles or cars and trucks with signs on them from parking on the street or even in your own driveway if the vehicle can be seen from the street.
You May Have Options
Options for retailers who want to work out of their homes is to sell their goods and services at craft fairs, expositions, by mail order, at flea markets or on the internet.
Deciding to run your own retail business is a big step, and it can be stressful. Knowing for certain that your plans follow the local zoning laws can ease some of that stress and lets you get on with the nuts-and-bolts of opening up for business.
Questions for Your Attorney
- Can I appeal my applications if it was rejected?
- Is it possible to change the zoning of my preferred location?
- Can the city or county change the zoning type without telling me?
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