Chapter 7 retail locations ppt
- 1. Presentation by Shaina Lacher, Milton Law, and Matthew Sullivan
- 2. Retail Locations: Chapter 7 Section 3: Other Locations, Location and Retail Strategy, and Legal Considerations Matthew Sullivan
- 3. Questions: * What types of locations are available to retailers? * What are the relative advantages of each location type? * Why are some locations particularly well suited to specific retail strategies? * Which types of locations are growing in popularity with retailers?
- 4. The Importance of Store Location - Store location is most often the first consideration in a store choice - Having a good location increases chances of developing a strong sustainable competitive advantage - Location decisions can be risky and should be well-thought out
- 5. Process of Choosing Particular Locations - Size of the trade area - Occupancy cost of the location - Pedestrian and vehicle customer traffic location - Restrictions on operations by property managers - Convenience of location for customers Trade area: the geographic area that encompasses most of the customers who would patronize a specific retail site
- 6. Section 1 - Types of locations - Unplanned retail locations Milton Law
- 7. Types of Retail Locations - Freestanding Sites such as outparcels and merchandise kiosks - City or Town Locations such as central business districts, main streets, and inner city locations
- 8. Advantages and Disadvantages of Freestanding Locations - Convenience for customers - Limited trade area when not around nearby retailers - High vehicular traffic and visibility - Higher Occupancy costs that strip centers - Modest occupancy costs - Usually located where there - Separation from competition is little pedestrian traffic
- 9. Freestanding Sites Retail locations for an individual, isolated store unconnected to other retailers Outparcels Merchandise Kiosks
- 10. Merchandise kiosks Small selling spaces, typically located in the walkways of enclosed malls, airports, train stations, or office building lobbies.
- 12. City or Town Locations - Lower occupancy costs - Traffic is limited due to - Higher pedestrian traffic congestion - Parking problems reduce consumer convenience
- 13. Central Business Districts (CBD) - Draws people during - High security required business hours - Shoplifting - Heavy public transportation - Parking is poor - Pedestrian traffic - Evenings and weekends are - Residential area as well slow
- 14. Main Streets vs. CBD’s - Occupancy costs are generally lower than CBD’s - Fewer people are employed - Smaller selection due to fewer stores - Range of entertainment is usually smaller - City planning sometimes restrict store operations
- 15. Inner City High density urban areas with higher unemployment and lower median incomes than surrounding areas - Retailers here achieve higher sales volume and higher margins, thus producing higher profits - Redevelopments in inner cities can cause increased traffic and parking difficulties, causing them to be controversial
- 16. Section 2 - Shopping centers Shaina Lacher
- 17. - Convenient locations - Limited trade area - Easy parking - Lack of entertainment - Low occupancy costs - No protection from weather
- 18. Power Centers Consist primarily of collections of big box retail stores - Target - Costco - Lowe’s - Sports Authority - Toys “R” Us
- 19. Shopping Malls Less than 1 million square feet More than 1 million square feet
- 20. Shopping Malls - Wide variety of stores - Occupancy costs are - Wide assortment of generally higher merchandise - Mall control over business - Shopping and entertainment operations - No inclement weather - Competition can be intense - Uniform hours of operation - Attracts many shoppers
- 21. Enhancing the Mall Experience - Common areas - Family lounges - Great food - Playgrounds - Entertainment
- 22. Mall renovations and redevelopment
- 23. Lifestyle Centers Shopping centers with an open-air configuration of specialty stores, entertainment, and restaurants with design ambience and amenities - Ease of parking - Less retail space - Relaxed open-air - Smaller trade areas environment - Attract fewer customers - Pedestrian traffic tends to be higher - Occupancy costs and operating restrictions are less
- 24. Fashion/Specialty Centers - Tiffany - Gucci - Max Mara - Giorgio Armani - Tommy Bahama’s
- 25. Outlet Centers - Strong entertainment component - Becoming more popular outside the United States - Tourism is important for outlet centers
- 26. Theme/Festival centers - Located in places of historic interests or for tourists - Anchored by restaurants and entertainment facilities - Generally targeted at tourists, they may also attract local customers - A common element of these centers is entertainment, although some rely solely on the shopping experience
- 27. Omnicenters Omnicenters are becoming more popular in the U.S. partly from the desire of tenants for lower common- area maintenance charges and the growing tendency of consumers to cross- shop.
- 28. Mixed Use Developments - Offer an all-inclusive environment so that consumers can work, live, and play in a proximal area - Combine several different uses into one complex, including shopping centers, office towers, hotels, residential complexes, civic centers, and convention centers
- 29. Section 3 - Other Locations - Location and Retail Strategy - Legal Considerations Matthew Sullivan
- 30. Other Location Opportunities - Airports - Temporary or pop-up stores - Resorts - Store within a store
- 31. Airports - High pedestrian traffic - Sales per square foot are higher than mall stores - Rent is higher - Hours are longer - Inconvenient location for workers means higher wages
- 32. Temporary Locations (pop-up stores) - Good for businesses trying to create a little hype - Good introduction for new stores or products - Provide visibility for a business - Provide additional sales during holidays and special events
- 33. Resorts - Captive audiences - Wealthy customers - People with time on their hands
- 34. Store within a store - This concept benefits both companies to attract more customers - Helps fill holes in product offerings
- 35. Farmville Businesses take advantage of locations where customers are, like the internet and online games, and provide them with alternative ways to spend money
- 36. Location and Retail Strategy - Shopping behavior of consumers - Size of Target Market - Uniqueness of Retail Offering
- 37. Shopping Situations - Convenience shopping - Comparison shopping - Specialty shopping
- 38. Convenience Shopping - Wants to exert little effort to acquire product or service - Wants convenient location - Less concerned with price - No hassles
- 39. Comparison Shopping - General idea about product or service - No strong brand preference - No strong retailer preference
- 40. Specialty Shopping - Knows what they want - Accepts no substitute - Strong loyalty to product or brand
- 41. Size of Target Market For most retailers, the size of the target market and the location of the highest density of their target market will help determine where their business should be located. - Estimate max # of customers eligible to purchase product or service - Estimate percentage of potential customers - Estimate # times customers could purchase the product or service in a year - Estimate highest density of target market
- 42. Uniqueness of Retail Offering - Location doesn’t matter as much because the product is that important or unique
- 43. Legal Considerations - Above ground risks - Sign restrictions - Hazardous materials - Licensing requirements
- 45. Zoning and Building Codes