Sunday, January 18, 2015

Choosing a location for your retail business

Retail is a booming sector in the Philippines. For aspiring entrepreneurs, now seems to be the prime time to move forward and launch their retail businesses. But where to open a store? Keep these basic factors in mind when you're shopping around (pun not intended) for the perfect space.

Demographic
Ask yourself: who is my target customer? Often, choosing a location revolves around your demographic. Are your products and services upmarket, affordable, or cheap? This alone should determine the neighborhood or building to look into. Your surroundings should reflect the brand character and target demographic of your business. High-end retailers benefit from units in upmarket lifestyle malls, or in a custom street-side boutique in a premium neighborhood. An affordable retailer, on the other hand, will be better suited to a mid-segment shopping center. Cheaper retailers would do well in an outlet or community mall.

Competitors
Look to where your competitors are located. You've likely noticed this yourself as a consumer: in a mall or in a retail strip, stores that provide similar products are often placed side-by-side. It's a strategy called “competitive positioning.” Customers that go to one store are likely to also check out its competition for options, thus driving more traffic and possible sales. You need to be seen among the competition, physically, to capture your share of the market.

Accessibility
This one's a no-brainer: your store should be accessible to your target customer. Convenience is a priority among modern consumers. No one quite fancies having to go to the ends of the Earth just to purchase something, especially if a competitor can provide the same thing for the same price just a stone's throw away. Keep factors like parking, traffic, peak hours, crowds, and public transportation in mind.

Visibility
"Out of sight, out of mind." Often, a store owner has to work toward the opposite of this saying. The store has to be visible. Its facade, its visual identity system, its signage, its display -- among other things -- should turn heads. To this end, it is advisable to choose a location where your target customers are abound to see, notice, and take interest in you. (However, for specialty stores who build and market their presence through other channels, this factor isn't as pressing.)

Cost
Rental rates will make or break your decision, in the end. Rates depend on the quality of the space and its location. Maintenance costs, overhead, and other fees also factor into the equation. Consult brokers and qualified professionals to determine whether the space is well worth what you will be spending.


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