Selecting the right location to build is crucial when planning for retail expansion. The site selection process will be among the most important decisions you make, which means taking time to do things the right way is going to pay off big in the long run. Here are five key steps that will help you make the best retail site selection.
1) Analyze Data
It’s vitally important that you base your site selection on facts. To get those facts, you’ll have to analyze data related to customer demographics, trade areas, market needs, and other factors. When you’re doing this, keep in mind that concentric rings or drive times aren’t the best factors for determining who’s in your trade area. You’ll get much better data using a method that’s based on Reilly’s Law of Retail Gravitation. This is also what Retail Attractions uses.
2) Factor In Surrounding Retail
It’s not enough to know the data about customers in your trade area. You also have to consider other factors. For example, other businesses surrounding the location you’re considering can impact the kind of traffic that’s coming in. You want to be able to profit off cross-shopping traffic from neighboring retailers. You’ll also want to avoid markets that are already saturated with direct competitors.
3) Identify Optimal Sites
After figuring out which communities have a good trade area and aren’t saturated with competing retail, you can start to narrow your focus. Find out if the available sites can actually meet all your needs. Figure out traffic patterns and determine how easy it will be for customers to notice, find, and get to each location. Check out local regulations and site economics to find out if this is a profitable place to build.
4) Find A Retail-Friendly Community
Most communities would welcome an influx of retail, but the number that’s actually ready to work with retailers is much lower. Try to find a community that provides retail incentives and has the municipal infrastructure in place to support retail growth. Time-to-market (the time between acquiring a property and opening the store) directly impacts your bottom line. If a community can streamline compliance regulation and show that their transportation, water, sewage, and electrical infrastructure can handle new growth, they can easily jump to the top of your consideration list.
5) Get An Expert’s Advice
There’s a huge number of factors, including several we haven’t talked about in this post, that play a role in retail site selection. A retail expert can help keep track of all these factors, make sense of data, and ask the right questions during the site selection process. Click here to learn more about how Retail Attractions can help with site selection. If you have any questions or want to find the perfect retail site, just contact us. We hope to hear from you soon!