Retail Location Analysis

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LOCATION DECISION IN RETAILING: A STRATEGIC ISSUE INTRODUCTION Retailing is now changing more rapidly than for a very long time. Opportunities and risks associated with store locations are heightened-by a retail business environment of rapidly evolving technological developments, changing competitive positions, altered consumer behaviour and expectations and modified regulatory situations. Store location analyses are required both to assess and improve sales performance of existing stores and to examine the viability of potential new stores. Opening new stores and extending or closing existing stores are such fundamental investment decisions that it is crucial to evaluate a store's or a set of stores' market potential and competitive .position. Conventionally, for retail property investment, the following criteria are deemed of significance in descending order of importance: location; building structure and design; tenure; tenant and lease. In this paper, attention is confined to the primary factor of location. It is argued that the data and methods are available to provide invaluable information to assist retail management with their decision making at an extremely small fraction of the cost of their aggregate investment. The need for some analyses becomes more urgent as the availability of prime locations for development diminish. To expand sales space, in their business strategy plans, retailers are examining a range of options, including the removal of existing stockrooms, the opening of satellite stores in the high street, and the development of edge-of-town or out-of-town sites. Especially with the last action, no real British experience is available to help retail management explore the implications of alternative strategies and it is believed that quantitative methods will become increasingly important because they can provide useful and actionable
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