7 Key Elements to consider when selecting the right business location
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7 Key Elements to consider when selecting the right business location

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Fact: If your current decision making tools focus on annually updated database printouts with no means to interpret major structural changes that have occurred within the U.S. economy since the ...

Fact: If your current decision making tools focus on annually updated database printouts with no means to interpret major structural changes that have occurred within the U.S. economy since the upheavals of 2008, you may be in trouble.

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    7 Key Elements to consider when selecting the right business location 7 Key Elements to consider when selecting the right business location Presentation Transcript

    • 7 Key Elements to Consider when  7 Key Elements to Consider when Selecting the Right Business  LocationFact: If your current decision making tools focus on annually  updated database printouts with no means to interpret  updated database printouts with no means to interpretmajor structural changes that have occurred within the U.S.  economy since the upheavals of 2008, you may be in  trouble. trouble
    • Recognize Change,  Overcome Old Paradigms ld d• Since 2007 the U S Has Experienced: Since 2007 the U.S. Has Experienced: – Financial Meltdown; – Housing Collapse (Double Dip?); Housing Collapse (Double Dip?); – Shrinking Incomes; – C t ti Contraction of Households; fH h ld – Expanding Unemployment; –A d And major stage of life shifts for your customers. j f lif hif f• Business as usual no longer applies
    • Physical Locations have NOTPhysical Locations have NOT ChangedWith proper care and maintenance, a building can stay With proper care and maintenance a building can stay standing for hundreds of years
    • Your Customer may have Changed Your Customer may have Changed In recent decades, regardless of the price range of a  neighborhood, one could count on a household moving out  neighborhood, one could count on a household moving out across the street to be replaced by a very similar household (at  least in terms of income). With home prices dropping up to  50% in many U.S. neighborhoods, and the craziness of  foreclosures, short sales, unemployment, etc. that will  f l h l l h ill continue for at least the next two years, THIS IS NO LONGER A  TREND YOUR BUSINESS CAN COUNT ON. As a business owner/operator, the old paradigm meant that the customer types in your As a business owner/operator the old paradigm meant that the customer types in yoursurrounding geography of homes and apartments did not change, particularly in terms of age and income. This is no longer true. 1946‐2007 2007‐?
    • 7 Key Elements that Contribute to Business Success b “Location Location Location ” the well known Location, Location, Location, the well known  mantra of the real estate industry and point of  purchase business success. The art and science  of location assessment cannot be taught in a  two‐day seminar. The ability to accurately and  effectively analyze a location takes years of  making practical decisions and mistakes before  becoming proficient, let alone an expert. The  becoming proficient, let alone an expert. The key is recognizing that the mantra is actually,  “Customers, Customers, Customers!” These 7 elements will give you quick clarity  Th 7 l ill i i k l i and insight into the make‐up and business  viability of any address in the United States. 
    • Residential Population: total population of all age groups  What is your minimum living in an area as defined for  population requirement?the particular geographical weights of your address category (i.e. General 1 Mile Radius, Strip Center, Power Center, etc.) Population Density (# persons  Urbanper square mile) ‐ the number of people living in that particular circumscribed area is the key concept.  SuburbanWhen comparing two different sites for the same address category, the higher the  h h h hResidential Population the higher the density.  Rural
    • Daytime Employment: total number of  workers that travel to a specific address in  the area measured to work in their full or  the area measured to work in their full or part time job. Who should you target your advertising dollars to, the surrounding neighborhood or the office park across  the street?
    • Having access to a tool to measure the general ability of an area’s residential households to withstand shocks to possible employment/income changes from the local and national to withstand shocks to possible employment/income changes from the local and nationaleconomic environment is vital to your success. A tool like this reflects the very stability of the geographic area itself, in terms of income, employment, and the strength of the average household’s ABILITY to be there and remain!  The Stability Strength of an area is related to  the FUTURE! It reflects the future stability of  the local economy given what is known today,  and also assesses the relative strength of an  and also assesses the relative strength of an Have you identified which of your  area to withstand an economic hit. locations, if any, are “at‐risk” of suffering  due to unforeseen economic changes?
    • Population by Age Cohort  Digital Generation—24% of the 2010 U.S. Population • More babies were born in the United States in 2007 than in Breakdown: total number and Breakdown: total number and any other year in American history (4,317,000)percentage of each age cohort (i.e. Baby Boomer, Gen X, etc.) in an  Echo Boomer—23% of the 2010 U.S. Populationarea. It is critical to understand the  • Entering the beginning stage of earning and spending  g g g g g p gdominant age cohort surrounding  power which will peak in twenty years.your address and weight your product mix, promotions,  Generation X—13% of the 2010 U.S. Populationadvertising, and overall marketing advertising and overall marketing • The US Census Bureau cites Generation X as statistically  holding the highest education levels when looking at age strategy to their desires and ability  group.to consume your service and/or product.  Baby Boomer—27% of the 2010 U.S. Population • Entering the stage of life where they have retirement in  Look around your own  focus, they are looking to downsize from their McMansion, neighborhoods, when have you  reduce costly expenses and save money. y g seen so many “children” living at  home? Bob Hope—13% of the 2010 U.S. Population • The Bob Hope generation is primarily retired persons living  on a fixed income with very low living expenses.
    • Imagine your own neighborhood and the local geographies your  friends live in. What you experience and what you see and hear  y p y about those around you impacts how you think of the future and  influence your spending decisions today. Perhaps, many of the homes in your neighborhood are  p y y g "underwater," and those that are selling are often sold at a loss.  There are noticeably more “For Sale” signs standing in yards waiting  for a viable offer. You now see vacant homes in your neighborhood,  and maybe more in the neighborhoods around you. Compared to last year, maybe more of your neighbors have either lost their job or have had their wages and hours cut. Wouldn’t an environment like that affect your willingness to part with your cash? Would this type of environment cause you to "splurge" less and save more when possible? Would it cause you to grace the doors of discount/value stores with a new mentality and check menu prices more closely when eating out? If you havent experienced this, good for you, but your customers might be going through it right now.
    • Residential Occupation Make‐up: total real  This can help you assess the success of a number and percentage of white collar and number and percentage of white collar and specific type of business.  specific type of businessblue collar workers that reside in a physical dwelling unit surrounding your business  For example, it’s likely that a hardware or address. auto parts business would probably do  better in a 1 mile radius heavily weighted  toward blue collar, whereas a fine dining  restaurant may do better in a heavily white  collar weighted area. collar weighted areaThe residential occupation make‐up is also very meaningful as you look forward to an area’s prospects of future employment/unemployment changes.
    • Average Household Income: total income brought in by all those occupying a dwelling unit in the measured area. The total sum of all these dwelling unit incomes is then divided by the total number of measured area The total sum of all these dwelling unit incomes is then divided by the total number ofoccupied dwelling units in the area surrounding your particular address to calculate the average household income. Household Income Ranges and Meanings: Household Income Ranges and Meanings: $100,000+ = Affluent $75,000 – 99,999 = High $50,000 – 74,999 = Medium $25,000 – 49,999 = Low Below $25,000 = Poverty Household Income is a measure commonly used by the United States government and private  institutions, that counts the income of all residents over the age of 18 in each household, including  not only all wages and salaries, but such items as unemployment insurance, disability payments, child  support payments, regular rental receipts, as well as any personal business, investment, or other  pp p y g p yp kinds of income received routinely. The residents of the household do not have to be related to the  head of the household for their earnings to be considered part of the households income.
    • Now What?Now What? • You now know what the “7 Key Elements” to  You now know what the  7 Key Elements to consider when selecting the right business  location are. Your immediate next step is to get  access to a tool that generates all 7 elements  for you ‐ for any address in the United States. Catalyst Analytics has built that tool for you.
    • 3L Score  Powered by Catalyst Analytics• Evaluate any address in the United States, in a matter of  y , seconds.• The 3L Score is comprised of last completed quarter and  current month data. Often the information is only days old. t th d t Oft th i f ti i l d ld• Customized for your specific business address. – Search by general radius circles (1, 3, or 5 mile) or by shopping center Search by general radius circles (1, 3, or 5 mile) or by shopping center  type (strip, neighborhood, community or power center) Do you have a concise picture of the  customer base surrounding your  business location(s)? b i l ti ( )?
    • Try the 3L Score Today! Visit www.3lscore.com or call (888) 600‐2370