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8/12/2019 Berman Ch 10 11e
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10-1Retail Mgt. 11e (c) 2010 Pearson Education, Inc. pu blishi ng as Prentice Hall
Site Selection
RETAILMANAGEMENT:
A STRATEGIC
APPROACH 11th Edition
BERM N EV NS
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10-2Retail Mgt. 11e (c) 2010 Pearson Education, Inc. pu blishi ng as Prentice Hall
Chapter Objectives To thoroughly examine the types of
locations available to a retailer: isolated
stores, unplanned business districts, and
planned shopping centers
To note the decisions necessary in choosing
a general retail location To describe the concept of one-hundred
percent location
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10-3Retail Mgt. 11e (c) 2010 Pearson Education, Inc. pu blishi ng as Prentice Hall
Chapter Objectives (cont.) To discuss several criteria for evaluating
general retail locations and the specific
sites within them
To contrast alternative terms of occupancy
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Overview Step 1: investigate alternative trading
areas (Chapter 9)
Step 2: determine what type of location isdesirable
Step 3: select the general location
Step 4: evaluate alternative specific storesites
Chapter 10 discusses steps 2-4.
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Three Types of Locations
Isolated
Store
Planned
ShoppingCenter
Unplanned
Business
District
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Isolated Stores
Advantages
* No competition
* Low rental costs
* Flexibility
* Good forconvenience stores
* Better visibility
* Adaptable facilities* Easy parking
Disadvantages
* Difficulty attractingcustomers
* Travel distance* Lack of variety for
customers
* High advertising
expenses* No cost sharing
* Restrictive zoninglaws
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Examples of Isolated Stores Large-store formats
Wal-Mart
Costco Convenience stores
7-Eleven
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Figure 10-1: Site Selection and Starbucks
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Unplanned Business Districts
Central BusinessDistrict
Secondary
BusinessDistrict
Neighborhood
BusinessDistrict
String
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Figure 10-2: A Revitalized Central Business
District
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Figure 10-3: Unplanned Business Districts and
Isolated Locations
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Figure 10-4: Macy’s and Shopping Centers
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Table 10-1a: Characteristics of Centers
Features Regional CenterTotal site area 30-100+
Total sq. ft. leased 400,001-2,000,000+
Principal tenant 1+ department stores
Number of stores 50-150 or more
Minimum # of people intrading area
100,000+
Driving time of trading area Up to 30 minutes
Location Outside central city onhighway
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Table 10-1b: Characteristics of Centers
Features Community Center
Total site area 10-40+
Total sq. ft. leased 100,001-400,000
Principal tenant Supermarket or drug store
Number of stores 5-15
Minimum # of people
in trading area
3,000-50,000
Driving time of tradingarea
Fewer than 15 minutes
Location In a single residentialarea
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Table 10-1c: Characteristics of Centers
Features Neighborhood Center
Total site area 3-15+
Total sq. ft. leased 300,000-100,000
Principal tenant Branch department store
Number of stores 15-25 or more
Minimum # of peoplein trading area
20,000-100,000
Driving time of tradingarea
Up to 20 minutes
Location Close to a populatedresidential area
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Figure 10-5: Festival Walk, Hong Kong
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Location and Site Evaluation
One-HundredPercent
Location
Theoptimum site
for a
particular store
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Figure 10-7:
Location/Site
Evaluation
Checklist
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Pedestrian Traffic
The most crucial measures of a location/site’s value are the number and type of people
passing by. Proper pedestrian traffic count should include:
age and gender (exclude very young children)
count by time of day
pedestrian interviews
spot analysis of shopping trips
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Vehicular Traffic
Important for
convenience stores
outlets in regional shopping centers
car washes
suburban areas with limited pedestrian
traffic
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Parking Considerations
Number and quality of spots
Distance of spots from stores Availability of employee parking
Price to charge customers for parking
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How Many Parking Spaces?
Shopping centers = 4-5 spaces per 1000
square feet of gross floor space Supermarkets = 10-15 spaces per 1000
square feet of gross floor space
Furniture stores = 3-4 spaces per 1000
square feet of gross floor space
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Figure 10-8: Corner Influence and Hershey’s
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Terms of Occupancy Considerations
Ownership versus leasing
Type of lease Operations and maintenance costs
Taxes
Zoning restrictions
Voluntary regulations
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Types of Leases
Percentage
Straight
Maintenance-Increase
Recoupment
Graduated Net
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10 27R il M 11 ( ) 2010 P Ed i I bli hi P i H ll
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written permission of the publisher. Printed in the United
States of America.