RETAIL MANAGEMENT: RETAIL LOCATION AND SITE SELECTION

1. RETAIL
LOCATION
PRESENTED BY: HIMANSHU BISHT
PGDM ( 2ND YEAR )

2. LOCATION DECISION
A retailer has to take the location decision,
taking into account three aspects:
 Selection of a city
 Selection of an area or type of location within
a city
 Identification of a specific site

3. LOCATION
The selection of the store site can be a non-systematic
process, which is based on ‘gut feeling’ or ‘environmental
observation’ or an imitation of competitors.
Steps involved in choosing a retail location
Step 1: Market identification
Step 2: Determining the market potential
Step 3&4: Identify alternate sites and select the site

4. Step 1: Market identification
The first step in arriving at a decision a decision on retail
location is to identify the markets attractive to a retailer.
This is important as he needs to understand the market
well, especially in a country like India, where every
region has its own peculiarities and needs.

5. Step 2: Determining the market
potential
In order to determine the market potential, the retailer
needs to take into consideration various elements. The
chief among them are:
Demographic features of the population
The characteristics of the households in the area
Competition and compatibility
Laws and regulations
Trade area analysis

6. Step 3&4 : Identify alternate sites and
select the site
After having determined the market potential and taking a decision
on the store, a retailer has to select the site to locate the store.
Though each retailer strives to find the 100% perfect location, there
are various factors which affect his decision. The chief among them
are:
 Traffic
 Accessibility of the market is also a key factor
 Amenities available
 To buy or to lease
 The product mix offered

7. Traffic :
This refers to both pedestrian and vehicular traffic. The traffic that
passes the site is an important determinant of the potential sales that
can be generated from that store.
Accessibility of the market is also a key factor:
Accessibility of the market is defined in terms of availability of public
transport and road/local transport train connections to reach the
market.
Amenities available:
Depending on the type of product to be retailed, facilities like free
and ample parking become important.
To buy or to lease:
An important factor to be considered before taking the decision on
the site the decision to buy the store or to lease it. if the store is to be
leased, then the terms of lease will have to be studied carefully.
The product mix offered:
The kind of product mix to be offered by the retailer by the retailer
also affects his choice of location.

8. Factor affecting the attractiveness
of a site
Local Demographics
Traffic Flow and Accessibility
Retail Competition
Site Characteristic
Cost Factors

10. Free standing location
1. Neighborhood stores:
 Convenience products
 Away from major markets
 Inside neighborhood
 Less competition, low rent, easy parking, better visibility.
 Difficulty in attracting customer
2. Highway stores:
 Attract customer passing highways-
 Fast food restaurant, dhaba

11. Unplanned business districts
1. Downtown or central business district
• A hub of retailing activity
• Draws customer from across city and suburbs
• Metro CBDs attract customers outside city
• Commercial street in Bangalore serve as up market for upper and
upper middle class customer
• Chandni chowk in delhi, chick in Bangalore and new market in
calcutta serve middle and lower middle class customers.
2. Secondary business districts
• Unplanned cluster of stores located on a major intersection of
cities
• Attract customers from many parts of cities.
• Dadar in Mumbai, Karol bagh in Delhi.

12. Planned Shopping Centres
Architecturally designed with parking facilities designed and
operated as a unit. In Chandigarh various sector markets are
planned.
1. Regional Shopping Centre or Malls
• Largest planned shopping centres .
• Major departmental stores, large trading area, high rent .
Cross roads-Mumbai, Spenser plaza-Chennai, metropolitan mall-
Gurgaon.
2. Neighborhood/Community Shopping Centres
• Usually have a balance mix of stores, grocery, chemist, variety
store, few other stores combinedly.
• Sector market complex in Chandigarh.

13. 3. Periodic market Peculiar market
• Meet at particular places on a particular day in a week.
• Retailers move from place to place.
• Limited credit transaction.
• Low overhead
• Hats, Som bazar.