10-1 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall Site Selection RETAIL MANAGEMENT: A STRATEGIC APPROACH 11th Edition BERMAN.

10-1 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Site Selection RETAIL

MANAGEMENT:A STRATEGICAPPROACH11th Edition11th Edition

BERMAN EVANS

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10-2 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Chapter Objectives To thoroughly examine the types of

locations available to a retailer: isolated stores, unplanned business districts, and planned shopping centers

To note the decisions necessary in choosing a general retail location

To describe the concept of one-hundred percent location

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10-3 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Chapter Objectives (cont.) To discuss several criteria for evaluating

general retail locations and the specific sites within them

To contrast alternative terms of occupancy

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10-4 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Overview Step 1: investigate alternative

trading areas (Chapter 9) Step 2: determine what type of

location is desirable Step 3: select the general location Step 4: evaluate alternative

specific store sites

Chapter 10 discusses steps 2-4.Chapter 10 discusses steps 2-4.

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10-5 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

IsolatedStore

PlannedShoppingCenter

UnplannedBusinessDistrict

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10-6 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Isolated StoresIsolated Stores

AdvantagesAdvantages* No competition* Low rental costs* Flexibility* Good for

convenience stores

* Better visibility* Adaptable

facilities* Easy parking

DisadvantagesDisadvantages* Difficulty

attracting customers

* Travel distance* Lack of variety for

customers* High advertising

expenses* No cost sharing* Restrictive zoning

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10-7 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Examples of Isolated StoresExamples of Isolated StoresLarge-store

formatsWal-Mart Costco

Convenience stores7-Eleven

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Figure 10-1: Site Selection and Starbucks

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10-9 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Unplanned Business DistrictsUnplanned Business Districts

Central BusinessDistrict

SecondaryBusinessDistrict

NeighborhoodBusinessDistrict

String

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Figure 10-2: A Revitalized Central Business District

10-11 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Figure 10-3: Unplanned Business Districts and Isolated Locations

10-12 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Planned Shopping CentersPlanned Shopping Centers

AdvantagesAdvantages* Well-rounded

assortments* Strong suburban

population* One-stop, family

shopping* Cost sharing* Transportation

access* Pedestrian traffic

DisadvantagesDisadvantages* Limited flexibility* Higher rent* Restricted

offerings* Competition* Requirements for

association memberships

* Too many malls* Domination by

anchor stores

10-13 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Figure 10-4: Macy’s and Shopping Centers

10-14 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Table 10-1a: Characteristics of Centers

Features Regional Center Total site area 30-100+ Total sq. ft. leased 400,001-2,000,000+

Principal tenant 1+ department stores Number of stores 50-150 or more Minimum # of people in trading area

100,000+

Driving time of trading area Up to 30 minutes Location Outside central city on

highway

10-15 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Table 10-1b: Characteristics of Centers

Features Community Center

Total site area 10-40+

Total sq. ft. leased 100,001-400,000

Principal tenant Supermarket or drug store

Number of stores 5-15

Minimum # of people in trading area

3,000-50,000

Driving time of trading area

Fewer than 15 minutes

Location In a single residential area

10-16 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Table 10-1c: Characteristics of Centers

Features Neighborhood Center

Total site area 3-15+

Total sq. ft. leased 300,000-100,000

Principal tenant Branch department store

Number of stores 15-25 or more

Minimum # of people in trading area

20,000-100,000

Driving time of trading area

Up to 20 minutes

Location Close to a populated residential area

10-17 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Figure 10-5: Festival Walk, Hong Kong

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Location and Site EvaluationLocation and Site Evaluation

One-Hundred Percent Location

The optimum site

for a particular store

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Figure 10-7: Location/Site

Evaluation Checklist

10-20 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Pedestrian TrafficPedestrian Traffic

The most crucial measures of a location/site’s value are the number and type of people passing by.

Proper pedestrian traffic count should include: age and gender (exclude very young children) count by time of day pedestrian interviews spot analysis of shopping trips

10-21 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Vehicular TrafficVehicular Traffic

Important for convenience stores outlets in regional shopping

centers car washes suburban areas with limited

pedestrian traffic

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Parking ConsiderationsParking Considerations

Number and quality of spots Distance of spots from stores Availability of employee parking Price to charge customers for

parking

10-23 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

How Many Parking Spaces?How Many Parking Spaces?

Shopping centers = 4-5 spaces per 1000 square feet of gross floor space

Supermarkets = 10-15 spaces per 1000 square feet of gross floor space

Furniture stores = 3-4 spaces per 1000 square feet of gross floor space

10-24 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Figure 10-8: Corner Influence and Hershey’s

10-25 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Terms of Occupancy ConsiderationsTerms of Occupancy Considerations

Ownership versus leasingType of leaseOperations and maintenance costsTaxesZoning restrictionsVoluntary regulations

10-26 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

Percentage

Straight

Maintenance-Increase

Recoupment

Graduated Net

10-27 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall

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