CHAPTER 7

Retail Locations

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 Learning Objectives
Learning Objective 7-1 Describe the types of retail
locations available to retailers.
Learning Objective 7-2 Review the types of unplanned
locations.
Learning Objective 7-3 Analyze the characteristics of the
different types of shopping centers.
Learning Objective 7-4 Discuss nontraditional retail
locations.
Learning Objective 7-5 Match the locations to a retailer’s
strategy.
Learning Objective 7-6 Review the societal and legal
considerations in selecting locations.

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 Location an Important Retail Decision

What are the three most important things in retailing?”

is “Location, location, location.”
Why is store location such an important decision for a
retailer?
One of the most influential considerations by consumer
Can be used to develop sustainable competitive
advantage
Location decisions are risky: buy or lease?

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 Types of Retail Locations 1 of 3
Learning Objective 7-1 Describe the types of retail locations available to
retailers.

Unplanned locations - do not have centralized

management that determines what stores will be in a
development.
Planned locations - the shopping center and/or manager
makes and enforces policies that govern store operations.
Such as the hours that a store must be open.
Common area maintenance (CAM)- managers responsible
for maintaining common facilities.

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 Types of Retail Locations 1 of 3
Learning Objective 7-1 Describe the types of retail locations available to
retailers.

Unplanned locations - do not have centralized

management that determines what stores will be in a
development.
Planned locations - the shopping center and/or manager
makes and enforces policies that govern store operations.
Common area maintenance (CAM)- managers responsible
for maintaining common facilities.

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 Types of Retail Locations 2 of 3

Gross leasable area - Total floor area designed for the

retailer’s occupancy.
Trade area – geographic area that has customers who
would patronize retailer.

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 Types of Retail Locations 3 of 3
Selecting a particular location type
• The size of the trade area (geographic area
encompassing most of the customers who would
patronize a specific retail site)
• The occupancy cost of the location
• The pedestrian and vehicle customer traffic
• The restrictions placed on store operations by the
property manager
• The convenience of the location for customers

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 Unplanned Retail Locations 1 of 3
Learning Objective 7-2 Review the types of unplanned locations.

Freestanding Sites
• Advantages
• Convenience
• High traffic and visibility
• Modest occupancy costs
• Fewer restrictions
• Disadvantages
• Little pedestrian traffic
• Higher occupancy costs
• Outparcels
• Outskirts of a shopping center

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 Unplanned Retail Locations 2 of 3

Urban Locations
• Central business district
• Draws many people during business hours but slow in
evening and weekends

• Inner city
• Urban decay
• Food deserts

• Gentrified residential areas

• Gentrification

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 Redeveloping the Central Business District

Cleveland’s East Fourth Street development

attracts consumers to the CBD.

©McGraw-Hill Education. © Philip Scalia/Alamy Stock Photo

 Unplanned Retail Locations 3 of 3

Main Street
• Traditional downtown shopping area in smaller
towns
• Secondary shopping areas in large cities and
suburbs
• Experienced decay over the past 30 years with
advent of big box retailers
• Redevelopment efforts focus on better shopping
experience
• Don’t draw as many customers as CBD

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 Redeveloping Main Street

Boulder, Colorado, has a thriving Main Street retail scene.

©McGraw-Hill Education. © Craig McCausland/Getty Images

 Shopping Centers and Planned Retail Locations
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Learning Objective 7-3 Analyze the characteristics of the different types of

shopping centers.

Shopping center
• Group of retail and commercial establishments that
are planned, developed, owned, and managed as a
single property.
• Anchors
• Shopping center management firm

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EXHIBIT 7-1 Characteristics of Different Retail Locations
1 of 2

Annual
Occupancy Shopping
Trading Area Cost (square Convenienc
Size (000 square feet) (Miles) foot) e
Neighborhood and 30 to 350 3 to 6 8 to 20 High
community
shopping centers
Power centers 250 to 600 5 to 10 10 to 20 Medium
Regional and 400 to 1,000 5 to 25 10 to 70 Low
super-regional
enclosed malls
Lifestyle centers 150 to 800 5 to 15 15 to 35 Medium
Outlet centers 50 to 400 25 to 75 8 to 15 Low
Theme/festival 80 to 250 N/A 20 to 70 Low
centers

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EXHIBIT 7-1 Characteristics of Different Retail Locations
2 of 2

Vehicular Restrictions on
Pedestrian Traffic Traffic Operations Typical Tenants
Neighborhood and Low High Medium Supermarkets,
community discount stores
shopping centers
Power centers Medium Medium Limited Category
specialists
Regional and High Low High Department and
super-regional specialty apparel
enclosed malls stores
Lifestyle centers Medium Medium Medium to high Specialty apparel
and home stores,
restaurants
Outlet centers High High Limited Off-price retailers
and factory outlets
Theme/festival High Low Highest Specialty stores
centers and restaurants

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 Shopping Centers and Planned Retail Locations
2 of 9

Convenience, Neighborhood, and Community

Shopping Centers
• Also called strip shopping centers
• Attached rows of open-air stores with parking typically
in front of stores
• Convenient locations, easy parking, relatively low
occupancy costs
• Limited trade area

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 Shopping Centers and Planned Retail Locations
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Power Centers
• Consist of a collection of big-box retail stores
• Have freestanding (unconnected) “anchor” stores and
fewer specialty stores
• Located near enclosed shopping mall
• Low occupancy costs
• Strong growth in this category

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 Shopping Centers and Planned Retail Locations
4 of 9

Enclosed Shopping Malls

• Attract many customers
• Large trade area
• Generate significant pedestrian traffic
• Weather not a factor
• Mall management provides level of consistency
• High occupancy costs
• Intense competition
• Older malls unappealing to shoppers

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 Shopping Centers and Planned Retail Locations
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Lifestyle Centers
• Resemble main streets in small towns
• Design ambience and amenities such as fountains
• Attractive to specialty retailers
• Bad weather can impede traffic
• Convenient parking
• Occupancy costs lower than enclosed malls
• Less retail space

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 Lifestyle Centers

Resembling main streets in

small towns, lifestyle
centers like the Easton
Town Center in Columbus,
Ohio, are shopping centers
that have an open-air
configuration of specialty
stores, entertainment, and
restaurants, with design
ambience and amenities
such as fountains and
street furniture.

©McGraw-Hill Education. © Ty Wright/Bloomberg/Getty Images

 Shopping Centers and Planned Retail Locations
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Mixed-Use Development
• Combine several different uses into one complex
including retail, office, residential, hotel, recreation, or
other functions.
• Live-work-play environment

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 Shopping Centers and Planned Retail Locations
7 of 9

Outlet Centers
• Contain mostly manufacturers’ and retailers’ store
outlets
• Some include entertainment component
• Typically in remote locations
• Tourism provides major source of traffic

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 Shopping Centers and Planned Retail Locations
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Theme/Festival Centers
• Relatively new concept
• Boston’s historic Faneuil Hall reconceived as “festival
marketplace” in late 1970s
• Often viewed as tourists traps and avoided by locals

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 Theme/Festival Centers

The Grand Canal Shops at the Venetian Hotel in Las

Vegas is a theme/festival center with a unifying theme.

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 Shopping Centers and Planned Retail Locations
9 of 9

Larger, Multiformat Developments

• Omnicenters combine enclosed malls, lifestyle
centers, and power centers
• Reflect growing tendency of consumers to cross-
shop

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 Nontraditional Locations 1 of 2
Learning Objective 7-4 Discuss nontraditional retail locations.

Pop-Up Stores and Other Temporary Locations

• Pop-up stores are temporary locations that focus on
new products or limited group of products
• Store-within-a-store locations involve retailer who
rents part of retail space operated by another
independent retailer
• Merchandise kiosks are typically located in
walkways of enclosed malls, airports, or office
buildings.

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 Nontraditional Locations 2 of 2
Birchbox’s pop-up Macy’s has an Apple
store is in a temporary store-within-a store at
location and focuses its flagship location in
on a limited selection New York.
of products.

©McGraw-Hill Education. © Barry Brecheisen/Invision for Birchbox/AP Images; © Anne D'Innocenzio/AP Images
 Location and Retail Strategy 1 of 2
Learning Objective 7-5 Match the locations to the retailer’s strategy.

Shopping Behavior of Consumers in Retailer’s

Target Market
• Convenience shopping
• Consumer concerned with minimal effort to get product
• Comparison shopping
• Consumer more involved in purchase decision
• Destination stores
• Specialty shopping
• Consumers know what they want and will not accept
substitute, willing to pay a premium

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 Keywords 1 of 7
anchor A large, well-known retail operation located in a shopping center or
Internet mall and serving as an attracting force for consumers to the center.
building codes Legal restrictions describing the size and type of building, signs,
type of parking lot, and so on that can be used at a particular location.
central business district (CBD) The traditional downtown business area of a city
or town.
common area maintenance (CAM) The common facilities maintenance that
shopping center management is responsible for, such as the parking area,
providing security, parking lot lighting, outdoor signage for the center,
advertising, and special events to attract consumers.
community shopping center An attached row of stores, usually with onsite
parking in front of the stores. Also known as convenience, neighborhood, or
strip shopping center.

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 Keywords 2 of 7
comparison shopping A type of shopping situation whereby consumers have a
general idea about the type of product or service they want, but they do not
have a well-developed preference for a brand or model.
convenience shopping center An attached row of stores, usually with onsite
parking in front of the stores. Also known as neighborhood, community, or strip
shopping center.
convenience shopping When consumers are primarily concerned with
minimizing their effort to get the product or service they want.
cross-shop A pattern of buying both premium and low-priced merchandise or
patronizing expensive, status-oriented retailers and price-oriented retailers.
destination store A retail store in which the merchandise, selection, presentation,
pricing, or other unique feature acts as a magnet for customers.

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 Keywords 3 of 7
food desert Area that lacks ready access to affordable fresh fruits, vegetables,
dairy, whole grains, and other healthful foods, as might be provided by grocery
stores or farmer’s markets.
freestanding site A retail location that is not connected to other retailers.
gentrification A process in which old buildings are torn down or restored to create
new offices, housing developments, and retailers.
gross leasable area (GLA) Total floor area designated for the retailer’s exclusive
use, including basements, upper floors, and mezzanines.
inner city Typically a high-density urban area consisting of apartment buildings
populated primarily by ethnic groups.
lifestyle center A shopping center with an outdoor traditional streetscape layout
with sit-down restaurants and a conglomeration of specialty retailers.
main street The central business district located in the traditional shopping area
of smaller towns, or a secondary business district in a suburb or a larger city.

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 Keywords 4 of 7
merchandise kiosk Small, temporary selling space typically located in the
walkways of enclosed malls, airports, train stations, or office building lobbies.
mixed-use development (MXD) Development that combines several uses in one
complex – for example, shopping center, office tower, hotel, residential
complex, civic center, and convention center.
neighborhood shopping center An attached row of stores, usually with onsite
parking in front of the stores. Also known as convenience, community, or strip
shopping center.
omnicenter A combination of mall, lifestyle, and power center components in a
unified, open-air layout.
outlet center Typically stores owned by retail chains or manufacturers that sell
excess and out-of-season merchandise at reduced prices.
outparcel A building or kiosk that is in the parking lot of a shopping center but isn’t
physically attached to a shopping center.

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 Keywords 5 of 7
planned location Shopping center for which management enforces policies
governing store operations, such as operating hours and also maintains
common facilities such as parking area and provides security, parking lot
lighting, outdoor signage, advertising, and special events to attract customers.
pop-up store Store in a temporary location that focuses on new products or a
limited group of products.
power center Shopping center that is dominated by several large anchors,
including discount stores, off-price stores, warehouse clubs, or category
specialists.
shopping center A group of retail and other commercial establishments that is
planned, developed, owned, and managed as a single property.
shopping center property management firm Company that specializes in
developing, owning, and maintaining shopping centers.

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 Keywords 6 of 7
specialty shopping Shopping experiences when consumers know what they
want and will not accept a substitute.
store-within-a-store An agreement in which a retailer rents a portion of retail
space in a store operated by a different, independent retailer
strip shopping center An attached row of stores, usually with onsite parking in
front of the stores. Also known as convenience, neighborhood, or community
shopping center.
theme/festival center A shopping center that typically employs a unifying theme
that is carried out by the individual shops in their architectural design and, to an
extent, their merchandise.
trade area A geographic sector that contains potential customers for a particular
retailer or shopping center.

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 Keywords 7 of 7
unplanned location Freestanding and urban retail locations that lack any
centralized management to determine which stores locate in them or how they
operate.
urban decay The process by which a previously well-functioning area falls into
disrepair.
urban sprawl Expansions of residential and shopping center developments into
suburban or rural areas, beyond urban centers.
zoning The regulation of the construction and use of buildings in certain areas of
a municipality.

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 Appendix of Image Long
Descriptions

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 Appendix 1 EXHIBIT 7-2 Zoning Map of Superior
Wisconsin
The map includes a different color for each of the
designated zones.
Zones include commercial, highway commercial,
shopping center district, central business district,
manufacturing-1, manufacturing-2, planned
development district, one family residential, two
family residential, apartment residential, sub-
suburban, and waterfront.

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