MRB 4+Location
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Transcript of MRB 4+Location
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CHOOSING A STORE
LOCATION
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Retailer can use a three step process based
on geogrphics when assessing where tolocate their business .these steps aregiven below
Regional analysis
Trading area analysis
Actual site analysis
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SHOPPING CENTRES
Shopping Centre is a group of retail & other
commercial establishment that is planned ,
developed, owned & managed as a single property .
2 main configurations
Strip Shopping Centers
Shopping centers that usually have a
parking directly in front of the stores.
Shopping malls
Shopping centers in whichCustomers park in outlying
Areas and walk to the stores.
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Strip Shopping Centers
- Traditional Strip Centre :- shopping centre thatis designed to provide convenient shopping for
the day-to-day needs of consumers in their
immediate neighborhood.
- Power Centers :- shopping center that is
dominated by several large freestanding
anchors.
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Shopping Malls
- Regional :- General Merchandise , fashion mainly, main attractions are its anchors , department &discount stores or fashion specialty stores .
- Superregional Centers :- similar to regional centrebut larger size.Has more variety & assortment
- Lifestyle :- Higher end,fashion oriented .
- Fashion /speciality centers
- Outlet:- manufacturers outlet stores
- Theme/Festival Centers :- unifying theme in
individual shops & also to an extend inmerchandise .
- Merchandise Kiosks :- small selling spacesoffering a limited merchandise assortment . Found
in shopping malls .
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CITY OR TOWN LOCATIONS
Central Business Districts :-business area in a city or
town . CBDs for retail trade are those with a largenumber of residents living the area .
Inner City Locations :- typically high density urban
areas .
Main Street Locations :- CBD located in traditional
shopping area of small town or suburb within a
larger city . Occupancy costs are genrally lower than
primary CBD .
FREESTANDING SITESRetail location thats not connected to other retailers ,
although many are located adjacent to malls
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OTHER RETAIL LOCATION
OPPORTUNITIES
Mixed-Use Developments (MXDs) :- combine severaldifferent uses in one complex , including shoppingcentres, office towers, hotels, residential complexes,
civic centers , and convention centers . Popular withretailers because they bring additional shoppers totheir stores.
- Airports
- Resort
- Hospitals
- Store within a store
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Site Selection
Region :- refers to the country , part of the
country , a particular city or
Metropolitan Statistical Area (MSA) :- city with
75,000 (in england) inhabitants , urbanized
area .
Trade Area :- contiguous geographical area. That
accounts for majority of stores sales &
customers . Maybe a part of city or mayextend beyond the citys boundaries .
Regional Analysis Trade Area Analysis Site Analysis
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Factors Affecting The Demand for a Region or
Trade Area- Economies of scale
- Demographic & Lifestyle Characteristics- Business Climate :- employment level , cyclical trends etc.
- Competition
- Saturated Trade areaEx:- some restaurants such as Burger king seek locations where their
major competition-McDonalds has a strong presence . They believethat it is important to go head-to-head with their strongest competitorsso that they can develop methods & systems that will allow them tosuccessfully compete with them .
- Understored Trade area
An area that has too few stores selling a specific good or service tosatisfy good or service to satisfy the needs of the population
- Overstored Trade areaHaving so many stores selling a specific good or service that some stores
will fail .
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- Span of Managerial Control
focus on certain geographic regions or trade areas.
- Global Location IssuesFACTORS AFFECTING THE ATTRACTIVENESS OF A SITE
-Accessibility
-Macro Analysis
- Road Patterns
- Natural Barriers
- Artificial Barriers
-Micro Analysis
- visibility
- Amount & quality of parking facilities
- Congestion
-Location Advantages within a Center
- Principle of Cumulative Attraction :- applies to both
stores that sell complementary merchandise & thosethat compete directly with one another .
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Estimating Demand for a New Location
Retailers estimate the demand for a new location by
defining its trade area & then estimating how muchpeople within the trade area will spend.
Trade Area :- divided into 2 to 3 zones
- Primary Zone :- geographic area from which store
derives 60 to 65% of its customers .
- Secondary Zone :- geographic area from which store
derives 20% of its customers/sales .
- Tertiary Zone :- outermost ring :- customers who
occasionally shop from the store .
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Factors defining Trade Areas- Store Accessibility
- Natural & Physical Barriers
- Type of Shopping area
- Competition
- Type of Store
(a) Destination store :- is one in which themerchandise , selection , presentation , pricingor other unique features act as a magnet for
customers .(b) Parasite Store :- one that does not create its own
traffic & whose trade area is determined by thedestination or dominant retailer in the retail area.
S f I f i d fi T d
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Sources of Information to define a Trade
Area
1. Determine no. of people /potential customers) &where they live
Technique :-
-Customer Spotting
-Census-Demographic data & GIS (Geographical Information
Systems)
-ACORN ( A Classification of Residential Neighborhoods)
-MPI (Market Potential Index)-SPI (Spending Potential Index)
2. Sources to assess competition .