The Importance of Understanding Site Requirements for Your Retail Franchise Business

Whether your choice is an auto repair facility or a pastry shoppe, a pharmacy or a flower stall, the single most important decision that will impact the success of your franchise business is the selection of its location. Any retail business, no matter how large or small, requires a strong market presence to attract customers and drive revenues. The right location is the key element to meeting these objectives to create a successful retail franchise business.

Each franchise business has its own criteria for identifying a successful location.

Criteria are based on the type of business and the demographic associated with target customer. For one franchise business a prominent storefront presence in a busy urban center may be required. This location, typical of commercial districts, features daytime and early evening pedestrian traffic. These locations are usually at or near public transit centers and offer easy access to popular bus and subway routes for residents, employees and visitors.
Another franchise business may be better suited to locations in retail shopping malls. In this type of location the customer is attracted to the major retail anchor tenants. These tenants reflect the economic status of a specific consumer group and this group of customers frequents this location. It is important when selecting this type of location to know your customer, such as their shopping habits and preferences, and to match these with the preferences and shopping habits of the average customer at the designated mall location.
Still other franchise businesses might be better suited to locations outside the city center. These suburban or rural locations may be either a free standing building or a storefront in a neighborhood retail center. Locations of this type need to be prominently positioned on well traveled streets or highways since it is the visibility of the location that will initially generate awareness of your franchise business. The location should have sufficient parking for customers and provide easy access and egress to the parking area. If the location is on a major highway it is important that the location be easily identified with appropriate signage. An easy on/off ramp from the highway to the site must be available to facilitate customer traffic to the location.
Whichever is the best site for your franchise business – downtown location, retail shopping mall, or a free standing building – the franchisor should provide site selection and evaluation guidelines. These guidelines identify the types of locations best suited to your franchise business based on a demographic identification of your target customer. These guidelines are the result of a careful analysis by the franchisor of franchise customers and their shopping habits. Knowing this information is key to better identifying and evaluating locations for your franchise business.
Typically these guidelines are provided as a manual outlining step-by-step instruction on how to implement a site selection survey. The survey, prepared by the franchisor, consists of a series of questions which are specific to understanding characteristics associated with a retail location. These questions identify major assessment criteria such as pedestrian traffic patterns or proximity to other similar retail competitors. A checklist may also be included to identify internal characteristics of the site such as availability of utilities or actual street frontage. The franchisee, when completing the survey, may be asked to include photographs of the location and the area immediately adjacent to the site.
The site selection survey is conducted by the franchisee. Upon completion the survey is submitted to the franchisor who is responsible for verifying its accuracy. The franchisor may request additional information, either from the franchisee, the site’s property manager, or the landlord. This information, in addition to demographic reports, traffic studies, and other data, is reviewed by the franchisor. Based on this analysis, the franchisor will then discuss with the franchisee the merits of a specific location for the franchise business.
It is important that before initiating the site selection process, a franchisor briefs the franchisee on what the requirements are for a location for the franchise business. While the franchisee is identifying potential locations, the franchisor should be available to answer questions and provide general guidance to the franchisee. Implementing a comprehensive process involving both the franchisor and the franchisee insures that both parties are establishing the framework for a strong working relationship. This framework is the basis for a successful long term franchise partnership.

About the Author. Ms McDonald is an international franchise consultant with experience in assisting local enterprises in developing their concepts as franchise businesses. Contact her at mcdonaldcabot@gmail.com or at www.mcdonaldcabot.com

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