FEBRUARY 2019
A franchised store brand looks to expand its retail footprint. This project proposes a strategy to select candidate new store locations through geospatial, demographic and socioeconomic analyses.
The strategy considers the following factors in three steps:
- In regions with an established customer base and high growth potential
- Adjacent to existing clusters of competitors
- In neighborhoods surrounded by high-income, high expenditure growth potential, and highly-educated population
Following this framework, I first analyzed the location and sales performance characteristics of existing franchised stores as well as those of its competitor stores. Then, combining this information with demographic information at the CBSA and Zip-code levels, I explored the relationship between store performances and regional/local context. Based on this, I then developed a scoring system to rank the suitability and competitiveness of each CBSA and neighborhood (defined as “service area” based on the density of each region) as a candidate for new franchised stores.
Data:
- Existing stores locations and store performance metrics
- Competitor locations
- Metropolitan CBSA demographics
- Zip Codes demographics
Note: after this preliminary selection process, the following steps need to take place to narrow down candidate neighborhoods and identify store locations at a more granular level –
- Discuss with the clients about the preliminary results and obtain consent on candidate neighborhood selection methodology
- Analyze the market gap within each candidate neighborhood
- Evaluate cost factors
- Select locations (street, etc.) for new stores
Yuqi Wang 