Retail development is vital for the success and growth of any community, but retail leakage can put a damper on growth. By using a Leakage/Surplus Analysis, community leaders can determine exactly how households are spending their retail dollars, where there are supply and demand imbalances and why consumers are leaving the trade area to shop. By analyzing consumers' lifestyles and needs, you can eliminate retail leakage.

1. Eliminating the Gap: How to
Stop Retail Leakage

2. Ask most any government
official: “What type of retail
development would you like to
see in your community?”

3. The answer heard most:
“Something that will stop
our citizens from leaving
our community to shop.”

4. The community leader needs to discuss their
plans, or lack of plans, for the retail
development of their community and why it’s
leaking retail dollars.

5. Leakage/Surplus (Gap)
Analysis
Retail leakage or surplus figures are
essentially calculations of demand less
supply.

6. Retail demand is a function of the number of
households in the trade area and how much they
spend on retail purchases annually.

7. Retail Supply:
• Amount of goods and services currently offered in
the trade area.
• A function of the amount of stores in the area,
their types and sizes, and projected sales volume.

8. Leakage occurs when retail
demand is greater than retail
supply
Households in the community or trade area
are spending their retail dollars outside the
community or trade area.

9. Retail Surplus occurs when retail
supply is greater than retail
demand
Customers from elsewhere are coming into the
market to support local retailers.

10. The Leakage/Surplus Analysis provides the dollars
of retail sales in your trade area plus the types
of stores they were spent in and products
purchased.

11. But these figures don’t tell you
“Why” and “Where.”

12. Along with annual dollar details, use detailed analysis to
answer the question, “Why have we lost retail sales?”

13. Start analysis by reviewing leakage by store
type and by product.

14. Look for patterns on why your citizens are
leaving the community to buy certain products or
shop in certain stores.

15. Are they leaving due to . . .
Price?
Service?
Product Selection?

16. Help define weaknesses and determine what to
improve by understanding your citizens’
needs, expectations, and what is important
to them.

17. What’s Next?
Analyze the lifestyles and buying
habits of customers in your trade area.
Identify and match candidate retailers
and restaurants that can succeed.

18. Analysis allows you to assist increase local
businesses sales through better selection of
merchandise, service and value, therefore improving
or eliminating retail leakage.

19. 1-888-2BUXTON
buxton@buxtonco.com
www.buxtonco.com
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