4 Steps in Choosing a Store Location Evaluate residents and existing retailers Shopping Center or standalone Select location according to nature of business.

4 Steps in Choosing a Store Location

Evaluate residents and existing retailersShopping Center or standaloneSelect location according to nature of

businessAnalyze sites in specified location type

Site Evaluation Checklist

Customer

Traffic

Number of people

Purchasing power of customers

Psychographic types of customers

Vehicular

Traffic

Numbers of vehicles

Traffic congestion

Type on vehicle in-out

Parking Facility

Numbers of parking spots

Walking distance to store

Availability of employee, truck loading

Site Evaluation

Transportation Accessible by public transportation

Ease of delivering and loading

Mass Transit

Store Composition

Competition around

Retail balance

Numbers and sizes of stores in area

Occupancy Rent or lease?

Maintenance costs

Size, shape, of lot vs. rental charge

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Small Business Management, 11th editionLongenecker, Moore, and Petty© 2000South-Western College Publishing

Finding an Optimum Location for a Small Business

Personal PreferencePersonal

Preference• Work at home• Friends and

relatives nearby• Lifestyle advantages

Customer AccessibilityCustomer

Accessibility

• Convenience for targetcustomers

Environmental Conditions

Environmental Conditions

• Laws and taxes• Weather• Competition

Resource AvailabilityResource

Availability

• Incubator orleasing options

• Raw materials• Transportation• Labor supply

Site Availability and Costs

Site Availability and Costs

9-4

Small Business Management, 11th editionLongenecker, Moore, and Petty©2000South-Western College Publishing

Leasing vs. Buying

Advantages of Buying

1. Freedom to design or modify structure

2. Guaranteed location

3. Hedge against inflation

Advantages of Leasing

1. Conserving cash

2. Minimizing risk

9-4

Factors Influencing Choice of Location

Proximity to target market

Condition of the neighborhood

Condition of the property

Parking

Traffic patterns

Reliability of landlord if leasing

Location of competitors

Conditions of the leases

Taxes

Square footage available

Storage space

Access to employees

Local area business climate

BusinessDistrict

ShoppingCenter

Stand-Alone or

Store

Retail Location

Types of Locations

Promotion for Each Type of Location

Shopping Center

Business District

Stand-Alone

Prominent display & good signage Focus on variety not pricing

Quick service & easy menuNew promotion to attract visit

Destination place with deep selection of itemsCompetitive pricing to attract customers

9-6

Building Layout

Factory Layout Retail Store Layout

Processlayout

Productlayout

Grid pattern

Free-flowpattern

9-7

Grid Pattern of Store Layout

Display Racks

Racks

Racks

RestroomsStorageOffice

Display

Display R

acks

Check-out

Door

Door

9-8

Free-Flow Pattern of Store Layout

Door

Door

Racks

Display Racks

Check-out

Office

StorageStorage

Display

Table

EquipmentRefers to implements used in a business’s

operation. Includes machinery and tools needed to carry

out the main physical labor of a business. Forklifts, mechanic’s tools, and computers are all equipment in this sense.

Equipment also includes things used in managing the business or selling its products.This means that furniture and appliances (like

telephones and hairdryers) are equipment.

Fixturesattached to the building or thought of aspart of it (like ceiling lights and display cases).

Suppliesare items that are used up in the operation of the

business. They may also support the administrative side of the

operation. (Materials like computer paper, pens, or paper clips, shampoo.)

Inventoryrefers to merchandise purchased by a business for

eventual resale.

Equipment, Supplies, Inventory