Is It Better to Set Up a Business in The City or Countryside?

The ever-growing world of technology has meant business owners no longer need to confine their operations to busy city and town centres. But just what are the pros and cons of establishing a base in a rural area? We take a close look below…

Rural business life: productive and low-cost

countryside business startup
photo credit: Ed Yourdon via photopin cc

There’s a lot to be said for setting up away from the city; while the pace of life is slower, this simply means that you’ll have a lot more time for your actual work, rather than having to cope with long commutes, traffic jams and lots of other people in general! You’re also much more likely to be able to fill a niche in the market compared with urban areas, as you may well be the only firm selling a particular product in that region.

While you might feel far away from some of your clients and even your employees, if you have remote staff, there are now many ways around this thanks to technology. The internet provides various means for communication with people around the country and even the world, while meetings are still very much feasible with the help of teleconferencing services.

Harnessing technology could lead to significant cost savings, too; your travel expenses are likely to be much reduced thanks to not having to meet colleagues and clients in person, for example. Setting up in the countryside can lead to reductions in other outgoings, too, as both rents and wages tend to be lower in rural regions compared with big urban centres.

Having said that, there can be some downsides to rural business life. Broadband provisions still aren’t quite as good as they are in major towns and cities due to a lack of an adequate network for rolling out high-speed internet services, although some of the bigger providers have plans in place for extending into the countryside. This means the few services you can get tend to be expensive and comparatively slow.

Also, the availability of public transport tends to tail off the deeper into the countryside you go, making a car or van essential for getting around – which may be an additional cost you don’t want.

In the city: prestigious and close to clients

business district
photo credit: lumierefl via photopin cc

So, what are the arguments for setting up in the city? Pretty much all of the negatives about rural business life can be flipped around to become advantages in urban areas – better public transport, higher quality broadband and a close proximity to customers and employees.

There’s also the prestige that comes with having a postcode in a recognisable location – some argue that clients are more drawn towards businesses with a London postcode than unfamiliar ones, as they have a good idea of where they’re based and therefore how easy it is to get to them.

On the flipside, though, is the fact that you’re likely to be operating in a competitive marketplace, with more neighbouring businesses offering the same products/services as your own. Furthermore, there’s no denying that increased costs can be a big issue, especially in London – the expense associated with labour and property can be enough to put many small firms out of business.

Another potential downside is the likelihood of a higher staff turnover than in the countryside. Job opportunities – and therefore the chance to earn a better wage and prospects – are more numerous in the city than in rural areas, making short stints at lots of firms the norm for many workers. In rural areas, workers are more likely to stay at the same company for longer, as they might have a deeper ‘local’ attachment to the organisation and therefore more of an emotional investment in their employer.

As you can see, it’s a closely fought contest between the city and countryside when it comes to setting up a small business – the location you end up choosing will ultimately depend on both the type of operation you have and your personal preference!