Site selection: the 7 secrets of success: when choosing a branch location, what's the difference between parcel 'A' and parcel 'B'? They may look and cost the same, but subtle distinctions could have an impact on viability.

• Author: Sablosky, Tanja Lian
• Position: Branch Design

Problem: You need a location for a new branch. You have completed your demographic survey and you have a fairly good idea where the branch needs to go geographically, say within a half-mile radius. Within this target area, you have identified two comparable sites at the same price (so exist is not a factor). How do you decide which site is better? In other words, what are the nitty-gritty details you have to take into consideration when narrowing down the site choices?

We posed these questions to a sample of five site-selection experts who work for clients in the financial services industry. Their observations and comments are organized below under seven categories of "things that need to be taken into consideration."

1. Are both lots big enough

   When estimating your lot-size need, have you taken everything into consideration? "You want to be sum your branch footprint will fit on the site," says Robert Schrader of Branch Facilitators LLC, Troy, Mich., "so have an architect standing by to evaluate the site--the architect will help establish how much you need for your ideal positioning, too."

   The ideal branch position is not always the one facing the street. If the majority of your parking will be away from the street, behind the building, your main entrance should face where most of your customers will be arriving, so your prospective site must have enough space to accommodate parking behind the building. Zoning ordinances may have more to say about how much parking is enough than you will, so be sum to check the local requirements before you decide that the site is adequate. Also, "Will there be enough space for a drive-through window?" asks Mary Beth Sullivan of Capital Performance Group, Washington, D.C. In addition, you'll need space for an "escape lane," notes Steven Reider, of Bancography Inc., Birmingham, Ala. You want easy ingress, egress and circulation around your branch.

   "You may need to buy a site that is bigger than you want or need to get a premium location," says Schrader. "When the market is hot and them is a lot of competition for one location (from pharmacies and retailers as well as other banks), you may need to pay extra for the site that is truly the best for you, but it will be worth it."

   Buying three acres when you only need one may seem wasteful or impractical, but it can give you greater flexibility in positioning your building. Then, you can sell or lease the land you are not using, keeping control over who your new neighbors will be.

   For urban sites, if you are choosing between two storefront sites, you probably won't be as concerned about a drive-through, or even parking, but you may be focused on the size of the existing site and whether there is room to expand (if it is a small site or if expansion is definitely in your plans). The size of your site will depend on the potential for growth in the market, says Joseph Sullivan of Market Insights Inc., Chicago. "In the current craze for building branches, many banks are choosing suboptimal sites," says Sullivan. "Base...