berman ch 10 11e

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10-1 Retail Mgt. 11e (c) 201 0 Pearson Education, Inc. pu blishi ng as Prentice Hall Site Selection RETAIL MANAGEMENT: A S T RA T EGIC APPROACH  11th Edition BERM N EV NS 1

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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 

1

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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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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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10-5Retail Mgt. 11e (c) 2010 Pearson Education, Inc. pu blishi ng as Prentice Hall

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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10-13Retail Mgt. 11e (c) 2010 Pearson Education, Inc. pu blishi ng as Prentice Hall

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

All rights reserved. No part of this publication may bereproduced, stored in a retrieval system, or transmitted, in

any form or by any means, electronic, mechanical,

 photocopying, recording, or otherwise, without the prior

written permission of the publisher. Printed in the United

States of America.