Types of Retail Locations:

• Isolated Stores: Standalone stores operating independently, often with:

  • Advantages: Lower rent, flexibility in design and operation, good visibility.

  • Disadvantages: Difficulty attracting customers, limited variety for shoppers, higher advertising costs.

• Unplanned Business Districts: Clusters of stores that develop organically, including:

  • Central Business Districts (CBDs): Downtowns with a mix of retail, office, and residential spaces.

  • Secondary Business Districts: Smaller business areas outside the CBD.

  • Neighborhood Business Districts: Retail clusters catering to local residents.

  • Strings: Linear strips of stores along a road.

• Planned Shopping Centers: Purpose-built retail developments with a cohesive design and management, categorized as:

  • Neighborhood Centers: Small centers anchored by a supermarket or drugstore.

  • Community Centers: Larger centers with a broader range of stores, often including department stores.

  • Regional Shopping Centers: Dominant centers with multiple anchor stores, attracting customers from a wider area.

  • Superregional Shopping Centers: The largest shopping centers, housing a diverse mix of stores and entertainment options.

Choosing the Right Location: A Multi-Faceted Approach

Selecting the optimal location involves evaluating various criteria:

• One-Hundred Percent Location: The ideal site that perfectly aligns with a store's needs regarding customer traffic, competition, and visibility. It's a target to strive for, but achieving it can be challenging.

Traffic Considerations:

• Pedestrian Traffic: The number and type of people walking by the store is crucial. Assess factors like:

  • Age and gender demographics (exclude very young children).

  • Traffic flow throughout the day.

  • Pedestrian interviews to understand shopping habits and destinations.

  • Analysis of shopping trip patterns in the area.

• Vehicular Traffic: Important for stores like:

  • Convenience stores.

  • Stores in regional shopping centers with large parking lots.

  • Car washes.

  • Stores in suburban areas with limited pedestrian traffic.

Parking Considerations:

• Number and Quality of Parking Spots: Ensure sufficient parking to accommodate customer needs while considering:

  • Spot availability close to the store entrance.

  • Designated employee parking areas.

  • Pricing strategy for customer parking (free, metered, etc.).

• Industry Standards for Parking: A general guideline suggests:

• Shopping centers: 4-5 spaces per 1,000 square feet of gross floor space.

• Supermarkets: 10-15 spaces per 1,000 square feet of gross floor space.

• Furniture stores: 3-4 spaces per 1,000 square feet of gross floor space.

Additional Site Evaluation Factors:

• Corner Influence: Corner locations often benefit from increased visibility and pedestrian traffic.

• Site Visibility: Ensure good visibility from the street and surrounding areas.

• Accessibility: Consider ease of access for pedestrians, vehicles, and public transportation.

Terms of Occupancy:

Understanding the legal and financial terms of occupying a retail space is crucial. Key considerations include:

• Ownership vs. Leasing: Decide between purchasing the property or entering a lease agreement.

• Lease Types: There are various lease structures, each with its own advantages and disadvantages. Here are some common types:

  • Straight Lease: A fixed monthly rent.

  • Percentage Lease: Rent based on a percentage of the store's sales.

  • Maintenance-Increase Lease: Requires the tenant to cover a portion of the property's maintenance costs, which can increase over time.