Month: October 2012
Population vs. Retail Base
Posted by Rickey Hayes on October 10, 2012 in Blog | No Comments
Retail Attractions, LLC
If you look at the 2010 census data for Owasso, Oklahoma you will see that the Census Bureau reports the population of the city at 28,915. If you drive through the city, you might be impressed at how well the city “shows”, that is the overall visual impact at eye level. But what will really boggle your mind is the fact that on nearly every corner in town is a national retailer or restaurant. Just go down the list…Wal-Mart, Target, Hobby Lobby, Belk, JC Penney, Kohl’s, TJ Maxx, Ross, Lane Bryant, Best Buy, Lowes, Home Depot, Pier One, Olive Garden, Cracker Barrel…they are all there. In a few months, another retail center anchored by Sam’s Club will open across the street from Walgreens and CVS Pharmacy. The question is always asked… How does a community with a population fewer than 30,000 residents have this level of retail presence?
So let’s go through some of the reasons why a community this small in population has such a massive and still growing retail base. 1) Growth. Owasso has been one of the fastest growing suburbs in the Tulsa MSA for the last twenty years. 2) Location. Owasso has a US highway infrastructure dissecting the community that three states use to access the urban areas of Tulsa. 3) Incentives. When communities across the nation were competing for retail deals, the city leaders of Owasso set Owasso apart from other growing communities with highway access by aggressively recruiting retailers using public/private partnerships to incentivize the deals. And most importantly… 4) Retail Base. Even if Owasso hadn’t had the exceptional residential growth and location, the city could have made a case to retailers because they city understood the difference between population and retail base. They understood the consumer trade area for Owasso extended far beyond its city limits, and this is true for many other communities.
We have often talked about defining your trade area in this blog, but probably not addressed exactly why this is so important. A city’s trade area is what defines the retail base for the city, and cities must use their trade area to accurately reflect their true retail potential to retailers. If a city has consumers from other communities shopping and dining in their city, their retail trade area is larger than that of their city limits. Other data providers use concentric rings from the city center or drive time models to identify trade areas, and while these methods require less time and effort, they often do not portray a realistic and defendable retail trade area. When Retail Attractions identifies a community’s trade area, we evaluate competing markets, natural barriers, traffic flow, accessibility, and the availability of developable real estate. Once the trade area is established, demographic data and opportunity gaps are identified, and this information profiles the type of consumer shopping in the area and what sectors are not being serviced in the area.
In the example of Owasso, a community with a city limits population of fewer than 30,000 residents has a retail base of nearly 250,000 consumers. At first glance, retailers dismissed Owasso as a viable development opportunity because it was too small, but city representatives recognized the retail potential of Owasso and were persistent. They identified a defendable trade area and went back to the retailers with their retail base demographics rather than their city limits demographics. This process was by no means easy, but persistence paid off for the city as well as the retailers. Owasso has countless top performing stores; stores that beat out stores located in major retail corridors in metro areas. This success is because the retail base for Owasso far exceeds the 28,915 residents retailers saw at first glance.
If you live in a city and think it has retail potential that is not being addressed, let Retail Attractions help you identify your retail base and effectively market your community to national retailers. Contact us today to get started!