Of critical importance to shopping center developers, owners, managers, and retailers overall is the trade area. A trade area is the geography from which approximately 60% to 80% of your customers' sales originate. There are a variety of ways to define trade areas, and they differ for proposed versus existing centers or store locations.
The optimally defined trade area takes into account factors such as population density, competitive locations, demographic, housing and lifestyle characteristics, physical and psychological barriers and access patterns. For proposed developments or redevelopment situations, this requires skilled judgment and experience.
For existing centers, trade areas can be determined with precision by obtaining point of sale (POS) data from credit card purchases. If POS data is unavailable, intercept surveys are a good way to determine shopping habits, demographics, and customer penetration.
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