How to Find the Best Retail Location
Location is requisite because of new retailers. Once you determine your target customer, you can start to careful search a viable site
by Karen E. Klein
I want to open an athletic shoe shop selling top brands. I’ve considered locations including exit malls, major malls, and a train station shopping strip. How do I determine the best location? —N.W., Fairfax, Va.
Location is in likelihood the most material decision you’ll tend as a startup retailer, so you’re wise to give it plenty of thought. Start by identifying your target customers. Will you be selling primarily to serious runners, student athletes, or mainstream shoe shoppers?
"The more mainstream your seek reference of the case, the broader your array of contest, which volition mean that…you necessity to co-locate with your competitors to be a contender," says Devon Wolfe, a managing director at Pitney Bowes MapInfo, a location consultancy. "If you’re going the specialty route, your store will be more of a destination, which means that you can set off closer to your target customer and fret less with reference to competitive positioning."
Once you narrow down your target customer as specifically as possible, outline our where that customer resides in your place of commerce, Wolfe says. You can exercise U.S. Census given conditions, or you have power to purchase reports, maps, and advice from a data vendor or situation consultant. "Look for locations that have high counts of your customer in a quick driving distance and provide submissive access and visibility to your customer. As you open the store, you’ll certainly want to consider local marketing campaigns, especially if you’re not associated with a branded franchise," Wolfe says.
Where you locate will also be assuming by your business lay out projections and in what manner much you have budgeted for rent, says Bob Kramer, a retail consultant. "Assuming a 40% gross edge, I would budget 10% of sales to cover both rent and advertising. Choosing the location will determine what is left for advertising," Kramer says.
If a emblematic large malls asks around 8% of sales for rent, that will leave you with only 2% for advertising—a slim budget for a new business that indispensably to get its name out, he says. "Personally, I would not choose the major beetle. And an outlet mall—at what place sales are price-driven—seems to have being an ill spasm for be superior brand athletic shoes," says Kramer. "You want to target customers willing to pay the higher price for an worthy of great praise shoe with an excellent paroxysm and crack service."
Wolfe agrees: "Outlet malls tend to focus on either single manufacturers or closeout specialists who buy overruns and overstocks from various manufacturers. If that’s not your business model, I would avoid the outlets."
In prescription to structure a body of attendants station shop a viable retail situation, it would need to draw added shoppers than just commuters—unless the commuting traffic there is huge, Wolfe says. "The other thing to think about is whether a train commuter will be willing to discover the time to comparison-shop for shoes," he notes.
Depending again put on who is your mark purchaser, you main cogitate about an independent location in a small strip center or a store in a center anchored by dint of. a large traffic generator such in the manner that a Wal-Mart (WMT), Kramer says. "Wal-Mart is not likely to carry the top brands, but they will draw customers towards you," he notes.
