When you’re making decisions about retail site selection, there are several important factors to consider. Selecting the right location for new retail expansion is key to success. As such, it’s vital that you understand all the factors involved.
The better you understand these important factors, the more likely you are to make a good site selection. We’ll talk about five key factors in this blog post, and five more in Part Two.
To look at relevant customer demographics in a certain area you need to know what type of customers will frequent your business. In other words, What is your target demographic’s customer profile? Knowing this will let you determine whether or not the customer base in the area you’re looking at is large enough to support your business.
Once you know what your customer profile looks like you can take this factor into account in retail site selection. Take a look at median household income, average age, marital status, family size, education level, etc. in the location you’re considering. The better a location’s population matches your target demographics, the better this site will be for your business.
Demographics are about who your buyer is. Psychographics tell you why they buy. It takes into account “your buyer’s habits, hobbies, spending habits and values” (from “How to Use Psychographics in Your Marketing: A Beginner’s Guide”).
Once you understand more about why your customers buy your products, you can make sure that you’re selecting a location that will appeal to them. For example, if most of your customers are health-conscious they’re more likely to find your store if you build near a gym than near fast-food restaurants.
Trade Area Population
You also need to look at how many people live in the area you’re considering for your next retail site. There has to be a large enough population in your trade area to support your business or there’s no point in building. You’ll also need to make sure that a high enough percentage of this population fits your customer demographic.
There’s more to defining an accurate trade area than just using concentric rings. You need to take into account population density, competing communities, natural barriers, traffic flow, accessibility, and other real-world factors.
If the trade area population matches your customer demographics and psychographics, then it’s time to start considering specific locations. You’ll want to look at how far each location is from residential areas and how visible it is from the road. Also, consider whether or not nearby businesses will draw-in customers who fit your profile.
You’ll also want to consider whether or not you’re going to plan for multi-location growth. If the trade area can only support one store or restaurant, then you’ll want a central location. But if the community, and your customer base, is growing you’ll want to plan ahead for the possibility of opening other locations in the future.
People are far more likely to visit your business if it’s easy to get to. You want people who see your sign or look you up online to be able to find your business easily If it’s too hard to access, then there’s a good chance potential customers will give up on finding you.
An ideal location makes it easy to turn in from the nearby roads and get into the parking lot. It should also be easy to get out of the parking lot, and if there isn’t a traffic signal in place you’ll want to find out whether the community is willing to put one in.
If you liked this article on important factors in retail site selection, be sure to check out the other articles on RetailAttractions.com. And if you want any help with retail site selection, get in touch with us. We have extensive experience with helping retailers find the best possible locations for their next expansion.
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