Pick the Right Retail Real Estate Location! Family expenses: and how they can guarantee success!

Location, location, location – we’ve all heard that catchphrase! Choosing a great location is of the utmost importance…the right location is one of the most important factors in a successful retail business.

Family expenses will greatly increase your chances of selecting the right area and location for your business. Whether you’re starting a new business or increasing the number of stores in your multi-unit retail business, the benefit of assessing the immediate area through household expenses is immeasurable.

First, we need to establish an understanding of our product or service, then choose a couple of categories that our product/service falls under. Any demographic profiling consulting firm can provide you with a list of the different categories of products or services they track or have in their profiling databases.

Second, we need to establish a radius, or catchment area, from which we think we can attract customers. For a typical small to medium retailer, the catchment/trade area is usually about 3 km around your potential or existing location. When we have finalized our product category or service category and our catchment or trade area, we can move on to the next stage.

Let’s say our product is widgets, the category we fit into in the database with our local demographic profiling consulting firm is general widgets. We have also come to the conclusion that we can attract clients from a distance of up to 3 km; therefore, we will use a 1KM circle and 3KM radius around our existing or potential location; as parameters for our study. We then produce a map and a list of variables, showing our potential or existing location; First, the map can show traffic counts, traffic drivers, daytime populations, etc., which will help us assess the immediate business area. Also, secondly, we produce a list of variables that includes; family expenses on general gadgets. Along with the above information that you also need to examine, let’s go into a little more detail about family expenses.

The data will show us… how much money is spent within a 1KM radius and a 3KM radius on general widgets within a one year period. The data will also show us how much money is spent per household on general appliances in a one year period. We now have some hard data on money spent and can begin to set up a sales prediction model. Let’s say $10,000,000 is spent on widgets within a 1km radius of our potential location within a 12 month period…we want as much of those dollars as possible for our potential new retail location. A good first step now would be to check out the competition in the immediate 1 km radius and compare their widgets to the widgets you intend to sell. Also the competitions: service, quality of the widgets and the appearance of their stores. Some of the items we might also evaluate are competencies, price, widget quality, packaging quality, merchandising, location, convenience, store hours, store capacity, return policy , the delivery service… these are just a few tips, there are many different variables that you can incorporate into your comparison.

The next step is to graph the results and compare your location or potential location with the competition. This study and comparison can become very long and detailed or quite simple depending on your needs. We can then follow the same procedure for the 3 km radius, if necessary. This helps us a lot in determining our sales at our potential new location. Which can also help us determine how much rent we can pay, how much staff we can hire, how much stock to order, etc. and be profitable. Also, if we are studying an existing location, we can set sales targets based on the numbers we conclude from our study. We can also see what aspects of our current location are inferior to the competition and address those shortcomings and hopefully outperform the competition on the same.

Evaluating family expenses will greatly improve our chances of choosing the right real estate location for a retail business. In addition, continuing to work on and assess family expenses as they become available year after year, will also greatly improve our chances for a continued healthy, successful, and profitable business!

Family expenses can do a lot more than you ever thought! Do you want to ensure your success and outsmart the competition? Choose to investigate the world of the evaluation of family expenses and open yourself to a new world of possibilities!