By Nathan Graham, Director of Commercial Services, Realtors® Property Resource
One key aspect of working with retail clients is understanding the supply and demand conditions for the markets they are looking to, or should be looking to enter. For example, if there are currently discount stores serving clients in an area that is transitioning to a more affluent consumer base, can these businesses sustain or might there be even more of a gap coming? Or if a retailer says they cater to young, educated adults with high disposable incomes, can a community support the business criteria and maintain the longevity of this targeted client base? This type of research is typically referred to as a retail gap analysis and fortunately for REALTORS®, it’s easier than ever to perform utilizing RPR® Commercial.
Define your geographical area based on the distance a typical consumer is willing to travel for a retail good. Use custom boundaries created with a drive time and radius tool or municipal boundaries like cities or neighborhoods.
Choose which version of RPR®’s gap analysis tools to use. The first helps you determine where a good location may work for a retail business and the second shows you what retail businesses would fit the needs of an area.
Identify the area and sectors showing opportunities. You need to do some digging to understand if the current retailers are set up to meet demands of potential consumers in the area. To do an assessment, create the geographical boundary that holds the consumer base and run a custom Trade Area Report in RPR®. This report combines economic, demographic, tapestry segments, and retail gap analysis, providing key insights to support your clients’ decisions to lease to a potential tenant, invest in a property, or operate out of a space.