Good Site Analysts Know Where to Put a New Store

Experienced site analysts can make sales forecasting meet the expansion objectives of a retail chain. Retailers are interested in making a profit, and when selecting a new store site, they will want to know whether the new location will help to reach untapped markets. Site analysts can help the reta...

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Bibliographic Details
Published in:Marketing News 1987-09, Vol.21 (19), p.6
Main Author: Green, Howard L
Format: Article
Language:English
Subjects:
Chain stores
Demographics
Forecasting
Market segmentation
Methods
New store openings
Profitability
Regression analysis
Retail stores
Sales
Sales forecasting
Site selection
Statistical methods
Techniques
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Summary:Experienced site analysts can make sales forecasting meet the expansion objectives of a retail chain. Retailers are interested in making a profit, and when selecting a new store site, they will want to know whether the new location will help to reach untapped markets. Site analysts can help the retailer decide whether investing in new and improved distribution facilities will help meet customer demands. Once a corporate plan of action is developed, sales forecasts must be made for each potential site. Analog, gravity, and regression techniques can be used to arrive at the best possible forecasts. The analog method is a search for underlying uniformities between a new site and a chain's analogous existing store locations. The gravity model combines a store size-geographic distance relationship with analytical judgment to determine the sales potential of a site. In regression modeling, the classic technique, existing store performance is compared with the many factors expected to influence sales. Each technique has unique advantages and drawbacks.
ISSN:0025-3790