In any community, the optimum site for a given retailer is called the “one-hundred-percent location.” Because different types of retail concepts require different kinds of locations, a site that is “100 percent” for one company may be less than optimum for another.

Having modeled location requirements for more than 1,100 client retailers and restaurants, it is our experience that “a list of variables” that fits all concepts does not exist. A mall-based retailer will have a different list than a concept that looks for free-standing locations. The big box discounter will have different requirements than a small specialty shop or a convenience store.

Location decisions are complex, and numerous variables go into the decision process. Some of these are outside the purview of the community. For example, many of the location considerations involve the owner or the leasing agent who will negotiate the sale or lease of real property. Factors that the community cannot control include costs and terms of occupancy, tenant finish-out, co-tenants and sales per square foot.

Communities can boost their chances of securing retail locations by providing certain information to retailers. This information involves:

• customers in the trade area
  
• available sites
  
• competitors either operating or planned
  
• growth potential
  
• and incentives.

Customers
The most important factor that retailers need to understand concerns the characteristics of the customers in the trade area. This information is especially important in the initial part of the location process. A retailer’s ability to make sound location decisions depends on how well the firm identifies and understands its customers.

To provide valuable information, the community must delineate its trade area based on drive-time analysis and develop detail about the lifestyles, buying habits and density of the customers in the trade area. Customer demographics should go beyond those reported in the standard census reports. Customer data should be gathered and assessed for the actual trade area, not the political jurisdiction. For instance, don’t give the retailer the demographics of the entire city if the trade area is just a small portion of the city.

Available Sites
Retailers and developers regard the availability of desirable sites as one of the biggest challenges they face when considering a community. Realizing the critical role that sites play in the location decision process, many communities are assembling and zoning sites. The competitive community will gather site-specific information on available sites, including characteristics such as:

• size
  
• infrastructure
  
• visibility
  
• access and parking
  
• traffic counts
  
• utilities
  
• and planned transportation improvements.

Competitors
Another decision-related factor that communities can give retailers is information about competitors. Retailers may view the competition as either positive or negative. Frequently a retailer desires to be close to a competitor knowing from experience that shoppers will compare price as well as quality and service. Restaurants often look for pad sites in the vicinity of established concepts realizing that they will draw customers to the area.

The community should provide details about retailers currently or planning to operate in their community, regardless of whether these competitors are seen as positive or negative by the retailer for whom the information is being gathered.

Growth Potential
Another variable to provide information about is the growth potential of the trade area. Published growth projections often understate the community’s actual potential, particularly in high-growth areas. By keeping tabs on developments, housing starts and major business expansions, the community can present a more detailed and accurate picture of the future than does the data available from other sources.

Incentives
For some retailers, incentives are becoming increasingly important to their location decision process. In a recent survey conducted by Buxton, 59 percent of the communities surveyed indicated that they had offered incentives for retail development. The most frequently offered were:

• infrastructure assistance, offered by 33 percent of communities
  
• tax increment financing, offered by 21 percent of communities
  
• and tax exemptions or abatements, offered by 20 percent of communities.

In addition to the factors described here, there are many other variables that can directly affect the cost of construction or operations that may be requested. Among those are taxes, building codes and regulations such as signage, security and the overall business climate in the community. The community that desires to attract and expand its retail base will be able to provide information about these variables and to respond to others that may be important to a specific prospect.