No two areas are the same. So, it seems logical that you match your stores to the local area. In practice, however, shops are often set up according to a standard concept, with all its consequences.

What local characteristics should you take into account as an owner or franchisee to turn your location or locations into a success?  

Shop floor area

Many retailers use the white areas plan as a basis for choosing every location. The available market area or an area’s theoretical potential is a significant factor in this. This partly determines the required floor surface area of a new branch to be opened.

“A local shop concept is a perfect response to areas with a smaller theoretical potential.”

You can perfectly adapt the size of the floor surface area to a somewhat smaller catchment area. This can be seen in practice in local shop concepts such as Shop&Go (Delhaize) and 'City' (SPAR), which are stores with smaller surface areas but with the right range of products to serve a smaller market area.

Prices

Every household is unique. The spending potential is different for each region, local area, even down to the level of the street or dwelling. Whereas some consumers are always “counting to the last cent”, others will barely pay attention to the price tags in your store. This offers opportunities for price differentiation, for example, as a retailer, you can charge higher prices for your products or services in high-income areas. Supermarkets such as Albert Heijn, Colruyt, Jumbo, and Hoogvliet have already put this into practice. We also see it happening in the food sections of filling stations, for example.

“Don't underestimate the power of your indirect competitors. You should also keep an eye on the product ranges of other players.”

In addition, the higher income groups are certainly prepared to pay a little more for convenience, for example in a shop in a hospital, at a holiday park, in an airport, or a station. These are locations where consumers like to be able to ‘pop in quickly’ to buy a few grocery items and where there are often no direct competitors.

Product range 

Many retailers analyse the competition at the level of the entire store. This gives you a picture of the direct competition. But don't underestimate the power of your indirect competitors. Don't just look at the well-known chain stores but also at the independent players in your sector. And keep an eye on the product ranges of other players. For example, a local flower kiosk, cheese shop, or pet store may face competition from a nearby supermarket. A perfumery may suffer from the perfume range of the local drugstore. And a bookshop might be competing with a department store’s book section.

“Find out whether you could form a partnership with certain competitors to attract new customers.”

If you have a broader product range, check your market space and your competitors’ product range for each category individually. This allows you to fill your shelf space with an optimal range that matches the area.

Competitors can also work to your advantage. Find out whether you can turn any competitors into perfect neighbours (partnership), for example, by setting up joint marketing campaigns to attract new customers. The possibilities are endless if you think outside the box! A good example is Decathlon, which seeks connections with sports clubs; another is BasicFit, which works with in-house physiotherapists. Other examples are parcel drop-off points in bookshops, pharmacies located in hospitals, an ENT specialist as a partner for an audiology centre, and insurance offices partnering with banks.

Opening hours

Local activities are critical when it comes to opening hours. Does the area attract many tourists? Or more office workers? Which would mean peaks at lunchtime and the end of the day, and dips at other times. And what about the habits of the local residents visiting your store? Are their visits spread out over the day or do they all come in at once just before closing time? Adapt your opening hours to your customers as much as possible, within the (legal) possibilities that you have. Don't be afraid to experiment! 

Moreover, as with the product range, look at what your competitors are doing. Neighbours reinforce each other, so if they are open, make sure you are open too! Otherwise, you may miss out on valuable customers...

Make an overview of your area

The first step in gaining awareness of your area is to get a visual insight into what else there is and what is happening near your stores. Smart tooling – such as the RetailSonar platform – can help.

As a retailer, you can decide for each store how you can optimally give content to your retail format.

Did you miss the first three parts? Read them here!

• Part 1: Mobility & visibility

• Part 2: Find the right neighbours

• Part 3: Know your competitors