7.0. HRSR 06-28-1999 - Laserfiche WebLink

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s STEP 3. WHAT IS THE TRADE AREA FOR THE BUSINESS DISTRICT? • PRIMARY TRADE AREA A trade earrea is the geographic area from which a store or shopping area attracts customers.The primary trade area is the geographic area from which most of downtown's customers and sales are drawn.For many communities there will also be a secondary trade area,a ring of influence for downtown beyond the primary trade area.Residents of this area can get to downtown with relative ease and will make the trip for a special business or a major festival. Why Determining a Trade Area is Important The trade area issue is an important factor to investigate because: • demographic information will be presented for the trade area; • potential new businesses will want to know where most of their potential customers live; • the business development team needs to be able to describe the demographics of potential markets;and • promotion committees need to know which media(covering what geographic area)to use for advertising. Issues to Consider • Multiple Trade Areas.Every downtown has multiple trade areas. Each downtown business may have a different trade area—the furniture store may draw from the entire county,while the video rental shop serves households within a ten block radius.For a downtown that has tourists, students,a close-in residential neighborhood,or a large number of office workers,the trade areas may differ by customer groups.However,for purposes of general trends analysis the business development team needs to define a trade area for the community's downtown shopping center as a whole. Subsequent analysis can address particular markets. Trade Areas and Municipal Boundaries.Trade areas are often drawn as a series of concentric rings around the shopping area.However,trade areas are rarely exact concentric circles, and often look more like amoeba shapes.As a practical note,retail sales data are published for cities, counties,zip codes,and metro areas,and the closer the community's trade area corresponds with one of these jurisdictions the easier it will be to analyze demographics and retail sales. Natural Boundaries.Despite consumers'mobility,the boundaries of trade areas still tend to stop at large physical barriers such as rivers,mountains and major highways.For this reason, it may be easiest to discover potential trade area boundaries using an official state highway map, because it will probably note mountain ranges, county borders,parks,railroads,and lakes, in addition to highways. • STEP BY STEP MARKET ANALYSIS-9