Trading area analysis
The first step in the choice of a retail store location is to describe and evaluate alternative trading areas and then decide on the most desirable one. A trading area is a geographical area containing the customer and potential customer of a particular retailer or group of retailers for specific good and/or services. The size of a trading area typically reflects the boundaries within which it is profitable to sell and/or deliver products. After a trading area is picked, it should be reviewed regularly.