Draft 10.18.2012

MesaRetail ScanRetail Float Update

LISC MetroEdge is a program of the Local Initiatives Support Corporation (LISC). It works in urban markets nationwide assisting CDC’s, local governments, developers and business associations to define their market potential and develop and implement strategies to achieve that potential.

Draft 10.18.2012

Downtown Mesa Trade AreaThis is a Convenience Trade Area. Its boundaries are:

East: Mesa Drive West: Alma School Road North: Tempe Canal South: Broadway

Shoppers would typically expect to find “Saturday morning” shopping options in this area such as pharmacies, groceries, dry cleaners, auto repair stores or hardware stores.

This area is 3.97 square miles

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Retail Float - DefinedFor the Downtown Mesa Trade Area we analyzed:

Demand – The amount of money people living in the trade area spent in 2011 for specific retail categories. These dollars are spent both within and outside of the trade area.

Supply – The amount of estimated sales by retail stores in the trade area.

Retail Float (also known as retail leakage) – The difference between supply and demand. This represents opportunity – for new businesses to open and capture Float, or for existing businesses to re-tool, adapt and market to capture Float.

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Retail Float ExampleFor the Downtown Mesa Trade Area:

Demand – In 2011, residents in Downtown Mesa spent $35.1 million at general merchandise stores (both within and outside the trade area)

Supply – In 2011, the general merchandise stores in the Downtown Mesa Trade Area had estimated sales of $12.6 million.

Retail Float - $35.1 million – $12.6 million = $22.5 millionDowntown Mesa Trade Area residents are spending at least 23.2 million outside the trade area at general merchandise stores.

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DefinitionsRetail Float, a measure of the amount of retail opportunity in the trade area, and is calculated as the difference between buying power (demand) and retail sales (supply)

When Retail Float is a positive value there is unmet demand by residents in the trade area, representing opportunities for new or existing businesses to target.

When Retail Float is a negative value there is either a healthy concentration of retail to build from, or there is a saturation of retail that indicates limited opportunity for business growth or expansion.

– Retail such as restaurants, clothing or furniture stores attract shoppers looking for multiple stores. In many cases negative float for these categories indicates a business opportunity to start or grow a business to complement what already exists in the market.

– Retail such as hardware stores, general merchandise stores and grocery stores are less likely to grow or expand when there is negative float (when there is little or no unmet demand in the surrounding market)

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Concentrated Buying PowerDefinition: Potential dollars available to be spent by trade area residents per square mile

There is an estimated concentrated buying power of $62 million in the Downtown Mesa Trade Area

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Retail FloatCategory Demand

Trade AreaSupplyTrade Area

Float Float as % of Demand

Motor Vehicle & Parts Dealers $34,906,262 $380,877,039

-$345,970,777

-991.1%

Furniture & Home Furnishings Stores

$4,191,387 $5,073,644 -$892,257 -21.3%

Electronics & Appliances Stores

$5,466,951 $45,081,580 -$39,614,629

-724.6%

Building Material & Garden Equipment

$18,421,258

$8,851,268 $9,569,990 52%

Food & Beverage Stores $39,133,614 $41,000,791 -$1,867,177 -4.8%

Health & Personal Care $13,187,244 $17,503,256 -$4,316,012 -32%

Gasoline Stations $26,110,412 $55,437,023 -$29,326,611

-112.3%

Clothing & Clothing Accessories Stores

$11,717,683

$8,549,852 $3,167,831 27%

Sporting Goods, Hobby, Book, & Music Stores

$4,849,146 $13,521,748 -$8,672,602 -178.8%

General Merchandise Stores

$35,109,582

$12,584,669

$22,524,913

64.2%

Miscellaneous Store Retailers $6,081,381 $18,814,677 -$12,733,296

-209.4%

Foodservice & Drinking Places $29,629,519 $36,717,676 -$7,088,157 -23.9%

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Retail Float Graph

Source: Nielson Retail Power Survey 2012, LISC MetroEdge Metrics

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Food & Beverage StoresCategory Demand

Trade AreaSupply

Trade AreaFloat

Supermarkets & Other Grocery Stores $34,083,429

$37,175,078 -$3,091,649

Convenience Stores $1,703,213 $943,953 $759,260

Specialty Food Stores $1,170,782 $507,864 $662,918

Beer, Wine, & Liquor Stores $2,176,190 $2,373,896 -$197,706

Source: Nielson Retail Power Survey 2012, LISC MetroEdge Metrics

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Health & Personal Care Stores

Category DemandTrade Area

SupplyTrade Area

Float

Pharmacies and Drug Stores $11,363,998

$15,069,494

-$3,705,496

Cosmetics, Beauty Supplies and Perfume Stores

$461,885 $554,743 -$92,858

Optical Goods Stores $493,465 $479,409 $14,056

Other Health and Personal Care Stores $867,896 $1,399,610 -$531,714

Source: Nielson Retail Power Survey 2012, LISC MetroEdge Metrics

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Foodservice & Drinking Places

Category DemandTrade Area

SupplyTrade Area

Float

Full-service Restaurants $13,296,910

$17,242,887 -$3,945,977

Limited-service Eating Places $12,626,664

$16,545,914 -$3,919,250

Special Foodservices $2,453,534 $1,275,165 $1,178,369

Drinking Places – Alcoholic Beverages $1,252,411 $1,653,710 -$401,299

Source: Nielson Retail Power Survey 2012, LISC MetroEdge Metrics