- the high costs associated with occupying the place such as renting, buying, or building costs;
- entering into long-term contracts;
- security issues in the area; and
- infrastructural and/or road network developments that affect the flow of foot traffic.
It is no secret that the success of a store is affected positively by its location; the better the location is, the more potential there is for it to succeed. Increasing certainty in location decisions requires invaluable information. The three analytical approaches below are sources of invaluable information.
Assess the potential, and estimate sales, of a new retail location through performing a gravity analysis (also known as spatial interaction model).
Estimate sales performance of a store under assessment through evaluating the performances of other stores with similar characteristics.
Identify and evaluate potential market areas with specific attributes to expand your business with confidence.