What Type of Retail Location is Best for Your Store?
by Carrie Hinkel on March 21st, 2008
In the world of brick and mortar retailing, there are a variety of spaces for a retailer to choose from. But, before you think that the process of picking a location is too overwhelming, it’s important to remember that each type of location really only caters to certain kinds of businesses. So, your store really may have only one or two types of “ideal” retail locations to choose from. Here are the six main types of retail locations as well as the types of businesses that tend to do best in each of them:
Malls - There are basically two different types of retailing options within a mall: kiosks (or carts) and storefronts. Mall space typically has higher rents than other retail locations because of the high amount of foot traffic. However, if you want to start out small, a monthly kiosk rental may be a good and affordable option. Otherwise you will be required to invest a substantial amount of money into designing your store space in order for it to look professional and fit in with the rest of the mall. Also, most malls are willing to lease kiosk space to more types of businesses than they would give store space to.
Shopping Centers - Pre-planned outdoor retail centers are becoming more and more popular as shoppers enjoy the fresh-air atmosphere with restaurants, playgrounds, rest areas and more. Some of the best shopping centers take years to plan, and have big retailers fighting for space before the construction crew even breaks ground. Shopping center developers realize that the success of the center depends on the right mix of retail stores, restaurants, parking and open space. Developers typically look for successful retailers with a recognizable store name. If your store is brand new or still in development, you may have a near-impossible time convincing developers that your store will be successful and contribute to the tenant mix.
Strip Malls - These are centers in which all the retail stores are attached to each other. There may be as few as 5 stores and restaurants, or as many as 30. Most strip malls are along main roads, so if your type of retail store benefits from walk-by or drive-by customers, then a strip mall may be a good choice. Most towns have several strip malls, some new and some old. Typically, the newer strip malls have at least one recognizable anchor store or restaurant to help draw in foot traffic. One potential problem with some strip malls is parking. If parking isn’t easily accessible or convenient, then customers may decide to avoid the congestion and shop elsewhere.
Downtown areas - Usually surrounded by big office buildings, downtown areas usually thrive during weekday lunch and after-work hours. Nearby workers stroll the area on foot and locals find parking either on street or in a nearby parking garage. Local and specialized stores tend to do well in these areas, however, parking may be a problem if your business relies on business outside the surrounding area.
Stand-alone Locations - Off on their own, these stores aren’t necessarily convenient, but the retailer typically carries unique products that customers don’t mind driving for. A free-standing location will usually be bigger and allow for ample parking.
Choosing the right location is one of the most important things for determining the success of your store, so make the decision carefully. Do plenty of research on your target market and where they shop. Many retailers have made the mistake of putting price ahead of location, choosing a poor location in order to save a few hundred dollars in rent each month. That choice has led many retailers down an early path of demise. The location of a store should be based on its potential customers and where they live, work and shop.