Chapter 7: Retail Locations
Terms in this set (39)
When choosing a particular location type, what trade-offs are generally involved?
1. the size of the trade area
2. the occupancy cost of the location
3. the restrictions placed on store operations by the property manager
4. the convenience of the location for customers
the geographical area that encompasses most of the customers who would patronize a specific retail site
retail locations for an individual, isolated store unconnected to other retailers; might be near other freestanding retailers or a shopping center
What are the advantages of freestanding sites?
convenience, high traffic and visibility, modest occupancy cost, separation from competition, few restrictions
What are the disadvantages of freestanding sites?
no foot traffic, no drawing power
the renewal and rebuilding of offices, housing, and retailers in deteriorating areas--coupled with an influx of more affluent people that displaces the former, poorer residents
What are some advantages to gentrification?
affluence returned, young professionals, returned empty-nesters, incentives to move provided by cities jobs, low occupancy cost, high pedestrian traffic
central business district
the traditional downtown business area in a city or town
What are the advantages to central business districts?
draws people into areas during business hours, hub for public transportation, pedestrian traffic, residents
What are some disadvantages to central business districts?
high security required, shoplifting, poor parking, evening and weekends are slow
a group of retail and other commercial establishments that are planned, developed, owned, and managed as single property
What does the management control in a shopping center?
parking, security, parking lot lighting, outdoor signage, advertising, special events for customers
neighborhood and community strip shopping centers
attached rows of non-enclosed stores, with on-site parking usually located in front of the store
What are the advantages to neighborhood and community centers?
convenient locations, easy parking, low occupancy costs
What are the disadvantages to neighborhood and community centers?
limited trade area, lack of entertainment, no protection from weather
shopping centers that consist primarily of collections of big-box retail stores
What types of retailers can you find in a power center?
- full-line discount stores (Target)
- off-price stores (Marshalls)
- warehouse clubs (Costco)
- category specialists (Lowe's, Staples, Best Buy)
What are some characteristics of a power center?
open-air setup, free-standing anchors, limited small specialty stores, many located near enclosed malls, low occupancy costs, convenient, modest vehicular and pedestrian traffic, large trade areas
enclosed, climate-controlled, lighted shopping centers with retail stores on one or both sides of an enclosed walkway
regional shopping malls
less than 800,000 square feet
superregional shopping malls
more than 800,000 square feet
What are the advantages to shopping malls?
different types of stores, different assortments available, attracts many shoppers, main street for today's shoppers, never worry about the weather, comfortable surroundings, uniform hours of operation
What are the disadvantages to shopping malls?
occupancy costs are high, tenants may not like mall management control of operations, competition can be intense
shopping centers that have an open-air configuration of specialty stores, entertainment, and restaurants, with design ambience and amenities such as fountains and street furniture
shopping centers that typically employ a unifying them carried by the individual shops in their architectural design and in their merchandise
Who do theme/festival centers appeal to the most?
shopping center developments that are combining enclosed malls, lifestyle centers, and power centers
What is the purpose of omnicenters?
to generate more pedestrian traffic and longer shopping trips, to capture cross-shopping customers
What percentage of a store's sales and customers are from the primary zone? secondary zone? tertiary zone?
60-65%; 20%; N/A -- customers who occasionally shop at the store
What are some factors that affect the size of the trade area?
accessibility, natural & physical barriers, type of shopping area, type of store, nature of merchandise, assortment, location of alternative sources, competition, parasite stores
geographic information system (GIS)
a system of hardware and software used to store, retrieve, map, and analyze geographical data along with the operating personnel and the date that goes into the system
What are the two components of GIS?
coordinate system (latitude and longitude) & spacial features (rivers and roads)
What are three ways we can estimate potential sales for a store site?
Huff's Model, analog approach, & regression analysis
Huff's Gravity Model
the likelihood of customer shopping at a store becomes larger as the size of store or shopping center grows and travel time for the customer shrinks
multiple regression analysis
factors affecting the sales of existing stores in a chain will have the same impact upon the stores located at new sites being considered
retailer describes the site and trade area for its most successful stores and attempts to find a similar site
What are the two types of leases?
percentage leases and fixed-rate leases
What are three basic types of locations for retailers?
2. city or town business district
3. shopping center
Where else can retailers be located?
in a nontraditional location such as in an airport or within another store