Evaluating Grocery Store Siting
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Heidi Guenin and Nathan McNeil USP 543 – Final Paper 12/10/09 1 Evaluating Grocery Store Siting: A Case Study at SE 122 nd and SE Foster Introduction Grocery store location is a challenging problem both from the business perspective (where could a profitable business locate?) and the equity perspective (where is food access limited or inequitably distributed?). This project examines industry assumptions about grocery store location combined with demographic and other geoanalytic processes. The Bureau of Planning and Sustainability (BPS) is conducting a study of the SE 122nd Avenue corridor from Division Street south to Foster Road. The southern portion of study area has limited grocery access, as determined by several recent studies of food access in Portland, including the MURP Foodability 2009 Planning Workshop study completed last year. 1 (See Image 1) Image 1: Foodability 1 Armstrong, Kim, Elizabeth Chapin, April Chastain, Julia Person, Stephanie VanRheen, and Steve White. "Foodability: Visioning for Healthful Food Access in Portland." Thesis. Portland State University, 2009. Print.
Transcript of Evaluating Grocery Store Siting
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EvaluatingGroceryStoreSiting:ACaseStudyatSE122ndandSEFoster
Introduction
Grocerystorelocationisachallengingproblembothfromthebusinessperspective(wherecouldaprofitablebusinesslocate?)andtheequityperspective(whereisfoodaccesslimitedorinequitablydistributed?).Thisprojectexaminesindustryassumptionsaboutgrocerystorelocationcombinedwithdemographicandothergeoanalyticprocesses.TheBureauofPlanningandSustainability(BPS)isconductingastudyoftheSE122ndAvenuecorridorfromDivisionStreetsouthtoFosterRoad.Thesouthernportionofstudyareahaslimitedgroceryaccess,asdeterminedbyseveralrecentstudiesoffoodaccessinPortland,includingtheMURPFoodability2009PlanningWorkshopstudycompletedlastyear.1(SeeImage1)Image1:Foodability
1Armstrong,Kim,ElizabethChapin,AprilChastain,JuliaPerson,StephanieVanRheen,andSteveWhite."Foodability:VisioningforHealthfulFoodAccessinPortland."Thesis.PortlandStateUniversity,2009.Print.
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Thereareseveralcontiguousvacantcommerciallotsinthesouthernportionofthearea.Communitymembershavesuggestedthatthesevacantparcels(hereafterreferredtoastheFostersite)shouldbeexploredasapotentialgrocerystorelocation.(SeeImage2)ThisanalysisexaminesthesuitabilityoftheFostersiteasagrocerystorelocationbasedonacombinationoftraditionallocationfactorsandmorerecentconsumerdemographicresearch.Image2:SE122ndAvenueLandUsebyTaxlot
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BackgroundandExistingConditions
Standardgrocerystorelocationdecisionstakeintoaccountthesizeofthelotofthepotentialbuildingandparkingsite,marketleakage,variationsinserviceareabystoretype,andpopulationneededtosupportastore.Morerecentresearchalsoexploresdemographictrendsinconsumerstorechoice.LotSize&MarketLeakageTheFostersitehasanareaofroughly63,605squarefeet.ThereareseveralgrocerystoresinPortlandonlotsofasimilarorsmallersize,includingdozensofspecialtystoresandthreeNewSeasonsMarkets.2AnESRIBusinessAnalystreportfortheFostersiteindicatesthatthereismarketleakageof$8,159,848forgrocerystoreswithinafiveminutedriveandof$871,087forspecialtystoreswithinathreeminutedrive.3Marketleakageiscalculatedasretailpotentialminusretailsupplyandisoftenusedineconomicdevelopmentresearchasoneindicatorofwhattypesofnewdevelopmentanareacansupport.StoreTypes&ServiceCatchmentAreasTherearedozensofdifferentschemesusedtocategorizegrocerystoresaccordingtostock,size,andownership.Forourpurposes,wedevelopedasimplifiedversionoftheschemefroma2004articlefromtheJournalofPlanningEducationandResearch,asdetailedlater.4Theauthorsofthearticlenotedthat"fewpeoplewouldsubstitutewalkingfordrivingtothegrocerystore,evenifaccesswereexcellent."5Thisfinding,coupledwithourlimitedtimeframeandthetraditionallocationdecisionparametersledustofocusonautomobilesforthecreationoftheanalysisnetwork.Asupermarketgenerallyhasaconsumercatchmentareaofthreemilesorafiveminutedrive‐time.Specialtystorestypicallyhaveasmallercatchmentareaofonemileorathreeminutedrive‐time.Largediscountstoresoftenoperateataregionallevel,soatenminutedrive‐timeisaconservativeestimateoftheircatchmentarea.6DemographicTrendsDunkleyalsoreviewedexistingliteratureaboutconsumerdemographicsandpreferences,withfindingsrelevanttothisanalysis.Asincomeandeducation
2BureauofPlanningandSustainability,AlmaL.SelectGroceryStoreSizeTypesandMarketforPortland.Rep.Portland:BPS,2007.Print.3ESRIBusinessAnalystOnline.RetailMarketplaceProfile.Rep.2009.Print.4Dunkley,Bill,AmyHelling,andDavidSawicki."AccessibilityversusScale:ExaminingtheTradeoffsinGroceryStores."JournalofPlanningEducationandResearch23.4(2004):387‐401.CSAWebIllumina.Web.20Nov.2009.<http://csaweb105v.csa.com>.5393
6Flores,Alma.Personalinterview.18Nov.2009.
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decrease,orashouseholdsizeincreases,likelihoodofshoppingindiscountstoresincreases.Size‐constrainedgrocerystoresaremoresuccessfulinareasofhighincomeorinareaswherethereisalargepopulationwithoutpersonalvehicles.A2006articlefromtheInternationalJournalofRetail&DistributionManagementconcludedthatsupermarketpatronage(especiallyof"traditionalneighborhoodmarkets")increaseswithdecreasinghouseholdsize.7
MethodologyOverview
InordertoexaminethesuitabilityoftheFostersite,thisanalysisdrawsonPortlandgrocerystoredatafromBPS,PortlandstreetsdatafromMetro'sRegionalLandInformationSystem,anddemographicinformationfromthe2000Census.GroceryStoreDataThefirststepinthisanalysiswastogeocodeandmapalistofPortlandgrocerystorestoexaminemarketcoveragebystoretypeandtoassessthestoreserviceareasfordemographicorgeographictrends.ApreliminarylistwasreceivedfromBPS,updatedwithrecentlyopenedstores,geocoded,andcategorizedtouseintheanalysis.A.Stepstoanalyzethegrocerystoredatawereasfollows:(SeeImage3)1. ObtainedlistofGroceryStoresfromBPS.2. Addedknownmissingstores(GroceryOutlet,NewSeasons,Pastaworks).3. GeocodedtoPortlandStreetswitha98%matchrateandmatchedthe
remainingstoresmanually.4. Removedlocationsoperatingonlyaswholesalers.5. Assignedacategorytoeachlocationaccordingtosimplifiedscheme
informedbytheliteraturereview:• Supermarket‐full‐servicechainorindependentgrocerystore(ex.:
Albertsons)• Gourmet‐limitedselection;littletonononfooditems(ex.Zupan's
Market)• Specialty‐ethnicstores,greengrocers,bakeries,seafoodmarkets,
butchers,etc.(ex.:AnDongMarket)• Discount‐supercenters,warehouse/wholesalesellers(ex.:Winco)• Massmerchant‐departmentalizedstorethatsellsfoodinadditionto
otherhouseholdgoods(ex.:FredMeyer)
7Carpenter,Jason,andMargueriteMoore."Consumerdemographics,storeattributes,andretailformatchoiceintheU.S.grocerymarket."InternationalJournalofRetail&DistributionManagement34.6(2006):434‐52.Emerald.Web.20Nov.2009.<http://www.emeraldinsight.com>.
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Image3:GroceryStoresinPortland
StreetNetworkNextastreetnetworkwascreatedusingtheMetroRLISstreetsfile.Lengthswereconvertedtomilesanddrive‐timeswereassignedbasedonspeedlimitassumptionsdetailedbelow.B.StepstocreateaPortlandstreetnetworkwereasfollows:1. Addedamilesfieldtotheattributetableforthestreetshapefile.Themiles
werecalculatedaslength/5280.2. Addedaspeedfieldtotheattributetableforthestreetshapefile.Valuesfor
thespeedfieldwerepopulatedasbelow,accordingtostreettypeandinmilesperhour:
• Freeways=55• Highways=45• Primaryarterials=35• Secondaryarterials=30• Otherarterials=30• Allothers=25
3. Addedtwofields,"TF_Minutes"and"FT_Minutes"andcalculatedbothoftheirvaluestobemiles*60/speed.
4. Theseadditionsallowedforthecreationofanetworkdatasetthatcouldevaluatearoutebasedontimeimpedance.
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ServiceAreaAnalysisDrawingontheliteraturereviewedandcategoriesofgrocerystores(gourmet,specialty,supermarket,massmerchantanddiscount),standardbusinessmarketcatchmentareaswereassignedtoeachcategory.Networkanalystwasusedtocreateserviceareapolygonsaccordingtotheassigneddrive‐timecatchmentforeachstoreonourlist,aswellasforasitemanuallycreatedattheFostersite.C.Stepstocompleteaserviceareaanalysiswereasfollows:(seeModel&Image4)1. BasedonBPSinformation,dividedgrocerystoresintothreedrive‐time
catchmentgroupsandranthreeseparateserviceareaanalyses,changingonlytheimpedancebreaks.
• Discountstoreserviceareas:10minutebreak• Massmerchantandsupermarket:5minutebreak• Specialtyandgourmet:3minutebreak
2. Eachanalysisgeneratedoverlappingpolygons,androuteswerecalculatedtowardsthefacility.
3. ManuallycreatedafacilityattheFostersite.Ranserviceareaanalysiswith3,5,and10minutebreaks,calculatedtowardsthefacility.
4. IndividuallyselectedFostersiteandcomparisonstorepolygons(seestepD.3),savedaslayer,andthenexportedasshapefilestouseinclipprocessinstepD.5.
Image4:NetworkAnalystServiceAreasbyStoreType
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DemographicRastersDemographicdatawereusedtoassessthemarketdemographicsofapotentialnewgrocerystoreandofselectexistinggrocerystorelocations.Theliteraturereviewsuggestedthatcertaindemographicgroups(particularlyinrelationstohouseholdsize,medianhouseholdincomeandnumberofhouseholdswithoutamotorvehicle)providedfavorablemarketconditionsfordifferenttypesofstores.RasterswerecreatedfromCensusblockgroupdataandclippedtostorepolygonsinordertocompareourpotentialsitetoexistingstores.D.RastersofMedianIncome,HouseholdSizeandHouseholdswithNoVehicle1. Downloaded2000blockgroupCensusdataforMultnomahandClackamas
Counties(Householdsize(P14);Income(P53);Carownership(H442. Downloaded2000blockgroupshapefilesforMultnomahandClackamas
Countiesandmergedintooneshapefile.3. Joinedmergedblockgroupshapefiletodatatablefromstep1,basedonFIPS.4. Createdrastersurfacesforeachofthethreedemographicvariablesforusein
visualcomparisontoFostersite.1. Usedfeaturetopointconversiontoextractblockgroupcentroids.
Thesecentroidsprovidepointdataforthefollowingrasterinterpolationprocesses.IDWmethodchosentoavoidvaluesbelow0forallfactorsandabove100%forpercentageofhouseholdsowningnovehicles.
2. InterpolatedarastersurfaceforeachdemographicfactorusingIDW.▪ NoVehicle‐IDW2.0power,8points,10560feetmaxradius
(SeeImage5)▪ Householdsize‐IDW2power,8points,10560feetmaxradius
(SeeImage6)▪ MedianIncome‐IDW2.0power,8points,10560feetmax
radius(SeeImage7)3. ChoseotherstorecatchmentareastoanalyzeinstepD.5.5.Visually
examinerasterstochooseareaslikelytohavesimilarcharactertoFostersite(basedonmedianincome,householdsize,andnovehiclepercentage).
5. Createrastersurfacesfordemographicdataforeachoftherelevantserviceareapolygons:(seeModel)
1. ForeachofthethreeFostersiteservicepolygonscreatedinstepC.4,clippedthemergedblockgroupshapefilefromstepD3tothepolygon.
2. Convertednewpolygonstorasterbasedoneachofthethreedemographicfactors:householdsize,medianincome,and%householdswithnovehicle.
3. Examinedrasterstatisticsforeachofthedemographicfactors.
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4. Theserviceareafordiscountstoreshasahigherincomeandsmallerhouseholdsizethantheotherserviceareas.Thesegroupsarenotaslikelytoshopatdiscountstores.Thedemographicstatistics,coupledwithsizeconstraintsofsite,ledustoexcludediscountstoresfromfurtheranalysis.
5. Foreachservicepolygonofselectedcomparisonstores(stepD.4.3),clippedthemergedblockgroupshapefilefromstepD3tothepolygon.
6. Convertednewpolygonstorasterforeachofthethreedemographicfactors:householdsize,medianincome,and%householdswithnovehicle.
Image5:PortlandAreaHouseholdswithNoMotorVehicle
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Image6:PortlandAreaAverageHouseholdSize
Image7:PortlandAreaMedianHouseholdIncome
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ModelDemonstratingStepsTaken
FindingsDiscountStoreThefirststoretypethatweexaminedwasthelargediscountgroceryretailerwithatenminutedrive‐timeservicearea.AreviewoftheserviceareaincomparisontotheexistingaggregateserviceareafordiscountgrocerystoresinPortlandrevealedthatrelativelylittleuniqueserviceareawouldbeincludedfortheSEFosterRoadsite.(SeeImage8)
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Image8:PotentialDiscountStoreCatchmentArea
10 Minute Drivetime
Income Household Size% Households with no vehicle
Discount Mean $48,290 2.65 6.96%Range $15,787 - $100,514 1.61 - 3.45 0 - 39.6%
122nd Ave Site
AreviewoftheFostersiteshowsthattheserviceareafordiscountstoreshasarelativelyhighincomeandsmallhouseholdsize.Priorstudieshaveshownthatthesegroupsarelikelytoshopatdiscountstores.Thisbasicdemographicdata,coupledwithsizeconstraintsofthesiteandthelackofnewserviceareathatwouldbecreated,ledustoexcludediscountstoresfromfurtheranalysis.Gourmet&SpecialtyStoresToexaminethepossibilityofsitingagourmetorgrocerystoreatoursite,welookedatthethreeminutedrive‐timepolygonscreatedinournetworkanalysis.Byexaminingourrastersformedianincomeandthenforhouseholdswithoutamotorvehicle,weidentifiedtwostoreswithserviceareassimilartothatinthethreeminutecatchmentareaoftheFostersite‐onegourmetstore(Zupan’s)andonespecialtystore(HongPhat).ThethreeminutecatchmentareaoftheFostersite,alongwiththatoftwoselectedstoresareshownbelow.(SeeImage9)
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Image9–GourmetandSpecialtyStoreCatchmentAreas
3 Minute Drivetime
Income Household Size% Households with no vehicle Income Household Size
% Households with no vehicle
Specialty Mean $46,361 2.78 4.96% Specialty Mean $40,820 2.57 6.30%Range $32,083 - $65,655 2.42 - 3.10 0 - 20.4% Range $26,889 - $62,411 2.03 - 3.18 0 - 31%
Gourmet Mean $58,249 2.05 5.24%Range $25,333 - $85,000 1.57 - 2.50 0 - 34.2%
122nd Ave Site Comparisons
Lookingtothegrocerysitingliterature,whichpointedtohigheraveragehouseholdincomesasbeingakeyfactorinthesuccessofagourmetstore,wedeterminedthatsuchastoremightstruggleattheFostersite;itshouseholdincomewassubstantiallybelowthemedianincomeofthecomparisonstore‐$46,361comparedto$58,249.Basedontheliteratureandonthecomparisonofthesetwoareas,theFostersiteislikelytobebetterservedbyaspecialtystorethanbyagourmetstore.Supermarkets&MassMerchantsThethirdcomparisonwasbetweenafiveminutedrive‐timeserviceareafromtheFostersiteandthecatchmentareasoftwoothergrocerystores‐atraditionalsupermarket(Albertson's)andamassmerchant(FredMeyer).Theserviceareapolygonscreatedfromthesethreesitesinnetworkanalystcanbeseenbelow.(SeeImage10)
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Image10–SupermarketandMassMerchantCatchmentAreas
5 Minute Drivetime
Income Household Size% Households with no vehicle Income Household Size
% Households with no vehicle
Supermarket Mean $46,682 2.78 7.25% Supermarket Mean $48,318 2.79 6.77%Range $15,787 - $84,278 2.05 - 3.45 0 - 39.6% Range $21,146 - $78,262 1.94 - 3.26 0 - 28.4%
MassMerchant Mean $38,997 2.74 8.86%Range $21,146 - $78,262 1.92 - 3.39 0 - 28.4%
122nd Ave Site Comparisons
Literatureshowedthathouseholdsizeisnegativelyandmedianincomeispositivelycorrelatedtothesekindsofstores,sowelookedtoourdemographicrastersintheseareas.TheFostersiteissimilartobothofthecomparisonsitesandlooksasthoughitmightbeabletosupporteitherkindofstore.Lookingbacktoouravailablesitesize,itappearedasthoughthemassmerchantstorewasnotagoodfit;however,asmallsupermarketmightbeapossibility.
Conclusions
Thesizeofthesitewoulddetermostsupermarketdevelopers,althoughasmentionedpreviously,thereareatleastthreeNewSeasonsMarketsinPortlandonlotssmallerthantheFostersite.Specialtystoresoftenrequiremuchlesslandthansupermarkets,though.Giventhedemographicsofthearea,webelieveaspecialtyethnicmarketwouldservetheareawell.Nextstepsforthisanalysiscouldincludeworkingwithsmallsupermarketdevelopersorwiththelocalbusinessdistrict
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memberstoattractanappropriatespecialtystore.However,therewereseverallimitationstoouranalysis.Thereareundoubtedlyseveralgrocerystoresmissingfromthelist,andsupplementalfoodacquisitionlocations(suchasminimarts)werenottakenintoaccount.Inaddition,buildingsquarefootageplaysanimportantroleinstoresitingandinthevolumeofsalesneededtosupportastore.Thisanalysisoriginallyincludedsquarefootagefromtaxlotparcels,buthereagain,thedatawasincompleteandoftenincorrect.Thiswasparticularlytrueformixed‐usesites,wherethebuildingsizeoftenincludedallunitsonthesite,oratleastallcommercialunits.Mostshoppersfrequentmorethanonestore,andstorechoiceoftendependsonthenatureofthetrip.Inordertofullyunderstandthegroceryneedsinthearea,residentsurveysandmarket‐basketsurveyswouldneedtobecompleted.Interviewswithgrocerydevelopersandwiththeownersofexistingspecialtystorescouldprovidevaluableinsightintothedecision‐makingconstraintsthattheyface.ESRIGIStoolscanprovideapowerfulandflexiblewaytoanalyzedata,butforthisproject,thedataitselfwastoolimitedtogeneratearobustexamination.
