Notes

The market and competition

· The market is the place where buyers and sellers meet. Most commercial B2C exchanges (buying and selling in consumer markets) still take place face-to-face, so a physical location is required.

· Retail location should be driven by access to customers, but there will be a balance between customer footfall and rental/lease costs.

· Costs of location will vary according to likely sales and customer potential

· Retail location is not just about footfall, it is about type of footfall.

· An anchor tenant is usually the first and the leading tenant in a shopping centre whose prestige and name recognition attracts other tenants

· Sometimes, being in close proximity to competitors, a business can benefit from their marketing efforts.

· Large businesses spend a sizeable proportion of their advertising budget on driving consumer traffic to their locations, a flow of customers that a competitor business can take advantage of. There are also competitor businesses that, by congregating in the same area, create more customer interest and higher individual sales.

· Regional markets also apply to B2B (Business to Business) relationships. Manufacturers of components in many industries need to be located close to the users of their products. This has become increasingly true with the increased use of just-in-time systems, where being ‘on the doorstep’ is now the expected norm.