Sas Slide Understanding Locations


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Why locations are important to your business

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Sas Slide Understanding Locations

  1. 1. UNDERSTANDING LOCATIONS We all live, work, shop and enjoy ourselves in different places, or “locations”, but how do we define them, how do they inter-relate, and why does it matter? Site Assessment Services Consultancy
  2. 2. Potential locations for your stores or branches take different forms …. <ul><li>Town and city centres provide retail and office jobs, opportunities to shop and socialise (restaurants, theatres, nightlife), transport hubs (train and bus stations) and, increasingly, places to live; </li></ul><ul><li>Retail Parks offer jobs, shopping and leisure facilities such as cinemas; </li></ul><ul><li>Out of town malls offer the work, retailing and leisure facilities of a town or city centre, but with easier access; </li></ul><ul><li>There are also out of town office parks, airports, major hospitals, university and college campuses, smaller suburban retail centres and a whole host of other “touchpoints”. </li></ul> Site Assessment Services Consultancy All these locations offer opportunities for interaction with existing and potential customers.
  3. 3. All locations inter-relate within a hierarchy. Understanding those hierarchies will help your branch network planning …. <ul><li>Hierarchies of locations can be built around the 21 UK centres that dominate in terms of gravitational pull of population catchment, retailing and / or employment provision; </li></ul><ul><li>Sub-hierarchies can be built around some of the “feeders” to these 21 dominant centres, which include a whole range of locations, from suburban retail areas of limited attraction to sizeable market towns; </li></ul><ul><li>At which level within the overall hierarchy you organise your network and invest in it depends on the number of existing outlets you have, and your planned strategy for the future of your network; </li></ul><ul><li>Most studies and statistical analyses relate to the behaviour of shoppers or workers rather than bank customers, but the fact remains that hierarchies indicate the relative number of people likely to visit a particular location, and exposure to more people must mean a greater opportunity to transact and sell! </li></ul> Site Assessment Services Consultancy
  4. 4. An example of a hierarchy …. <ul><li>Droitwich is a town of some 25,000 people in Worcestershire. Residents can satisfy their basic daily shopping needs in the town, and may be able to find employment and limited social opportunities there; </li></ul><ul><li>Worcester is seven miles away, and has a population of nearly 100,000. Droitwich residents may need to travel there for a comprehensive supermarket shop, or to buy a suit, find a wider range of work opportunities or to visit the theatre; </li></ul><ul><li>Birmingham is some 27 miles from Worcester by road and is one of the 21 dominant centres in the UK. It has a population in excess of one million. People from both Droitwich and Worcester will commute to Birmingham city centre to work, to buy more specialist goods, or simply to take advantage of a wider range of stores and leisure and cultural opportunities; </li></ul><ul><li>In this case, if an organisation requires representation in every UK location of a reasonable size, all three centres could be considered, although the offering will vary from centre to centre. If representation is to be restricted to larger centres, Droitwich, and even Worcester could be excluded from plans. In the latter scenario, clearly not every potential customer from Droitwich and Worcester would be “captured” by the Birmingham outlet, but gravity still makes this the best investment opportunity of the three. </li></ul> Site Assessment Services Consultancy
  5. 5. The “dominant 21” UK locations …. <ul><li>These locations are those with the dominant retail / commercial / leisure “pulls”. They are not necessarily the 21 biggest cities by population. For example, Bradford is too close to, and dominated by, Leeds to qualify in its own right, whereas smaller cities such as Plymouth, Cambridge, Aberdeen and Norwich are included due to their relative geographical remoteness from other key centres ; </li></ul><ul><li>In the South East, because London is so dominant it is more difficult to define other key centres. To treat the whole South East as “London” creates too big an entity, however, so Southampton, Reading & Brighton are included, although they may not be as important in a relative sense as others in the 21. In no particular order; </li></ul><ul><ul><ul><ul><ul><li>LONDON BIRMINGHAM </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>MANCHESTER GLASGOW </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>LEEDS NEWCASTLE-upon-TYNE </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>NOTTINGHAM LIVERPOOL </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>EDINBURGH BELFAST </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>LEICESTER SHEFFIELD </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>CARDIFF BRISTOL </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>NORWICH CAMBRIDGE </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>PLYMOUTH SOUTHAMPTON </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>READING BRIGHTON </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>ABERDEEN </li></ul></ul></ul></ul></ul> Site Assessment Services Consultancy
  6. 6. <ul><li>The country is made up of catchments for different types of functions. Each school has its own catchment, as does each hospital. Similarly, each town and city centre has its own definable area from which those visiting the centre can be expected to come; </li></ul><ul><li>There are two ways to define a catchment. The most intuitive and easily understood method is to draw physical lines around each centre on a map and say the population within that line “belongs” to the centre. This is, of course, a simplistic approach; </li></ul><ul><li>In reality, catchments overlap significantly as most people visit more than one centre for different reasons in the course of their daily lives. Once these behaviours are measured and understood, “gravity modelling” through one of the specialist modelling organisations such as CACI or Experian can determine the numbers of people within each postal sector who belong to each centre. More difficult to map, but a more accurate portrayal of a catchment; </li></ul><ul><li>One important point is that catchments rarely follow artificial, manmade boundaries. An easy mistake to make is to assume that the population of the city of Nottingham, for example, indicates that city’s catchment. There were 267,000 people within the city boundaries at the 2001 Census, but over 650,000 in it’s continuous urbanised area. Allowing for the catchments of a few relatively small suburban centres, the city centre’s shopping population is around 580,000. </li></ul>Each location within a hierarchy has its own catchment …. Site Assessment Services Consultancy
  7. 7. <ul><li>From a management perspective, groups of outlets are usually described as “divisions”, “regions” or “areas”. While there is obviously an element of geographical proximity in determining these groupings, they are often artificial, with not all outlets “fitting together”; </li></ul><ul><li>Dividing your network on a local market basis ensures that sub-divisions are logical and meaningful. All locations within the market have a relationship with each other, whether it’s in terms of commuting, retail movements or leisure behaviour. A customer is more likely to interact with your company at locations within the same market than to stray outside. This allows for local consistency of service, local marketing campaigns etc; </li></ul><ul><li>It is for individual companies to decide on how many local markets they want to divide their network into. This may be a product of management spans of control, sheer size of network or geographical spread of network; </li></ul><ul><li>Feasibly you may decide on 21 markets, reflecting each of the dominant UK centres. Or you may go down to the next level – Worcester in our previous example; </li></ul><ul><li>However many are decided upon, it is important the locations you include in each market either all have a relationship with each other, or represent a series of inter-related locations. It is a bad idea, for example, to try to balance numbers of outlets in each market if this results in natural groupings being broken up. </li></ul>These catchments can be treated as “local markets” and reflected in your network planning …. Site Assessment Services Consultancy
  8. 8. <ul><li>Branches can be categorised based on historic business and potential, from small local stores to city centre flagships. This allows more appropriate target-setting and provides the opportunity for branch managers, for example, to progress up the scale; </li></ul><ul><li>Convenience retailing could be considered. For example, banks taking space inside large retailers such as supermarkets (the “us in them” model), or sharing under-utilised space with other businesses (“them in us”); </li></ul><ul><li>All this local market planning should be wrapped up in a Network Blueprint, a written plan for “what we want, where”, detailing internal market structures, proposed re-sites, consolidations, closures and gaps in the network that require filling. This Network Blueprint will be, essentially, a reflection of UK location hierarchies. </li></ul>Within local markets, a hierarchy of outlets could be defined and new ways of reaching customers considered …. Site Assessment Services Consultancy
  9. 9. <ul><li>Advice on constructing location hierarchies and understanding catchments; </li></ul><ul><li>Advice on establishing local markets based on those location hierarchies, and reconfiguring your existing network; </li></ul><ul><li>Advice on identifying new locations and different location types for representation; </li></ul><ul><li>Advice on categorising your existing outlets, and considering new types of representation; </li></ul><ul><li>Site Assessment Services will also sense-check modelled outputs or personal opinions from within your organisation, to give you peace of mind in your decision-making on re-sites, consolidations, closures or gap filling, saving you money by averting poor decisions ; </li></ul><ul><li>Site Assessment Services will be independent , apolitical and objective , giving consistent comparative advice across a range of locations, making on the ground assessments of the quality and character of each location; </li></ul><ul><li>Site Assessment Services will provide flexible assistance to your business, from a single day’s work to long-term contracts. </li></ul>What Site Assessment Services can offer you …. Site Assessment Services Consultancy