Once it has been established that there is a product type missing in the local market that is only likely to be filled by the opening of a new business, it is important to spend time identifying prospects and crafting a message and marketing package before starting the recruitment process. First, the recruitment team will need to be armed with relevant local information. This is necessary to demonstrate (both to the proprietor and the lender) that the local market exists to support the business, as well as to provide relevant information on potential space opportunities. The size, location and cost of the space is equally as important as, if not more important than, the community in impacting a retailer’s success. At a minimum, recruitment packages should include the following items, which should also be available online for future reference:
- A market profile summarizing the trade area demographics, daytime population, traffic counts, existing business mix, and any other notable destinations or attractions in the community;
- A brochure on each available space that represents a potential location for the business in question, along with relevant information on size, build-out and rental rates; and
- Information on the local business climate—events produced, testimonials from existing businesses, investment trends, future projections, etc.
A business owner exploring location options will typically have a mental image of the “ideal” location, and it is the responsibility of the recruiting community to demonstrate that the community/district and/or individual spaces would be a good fit.
Once the recruitment process has begun, it is important to understand that this is a long-term undertaking. Businesses do not relocate overnight. It often takes months to identify the appropriate site, and more months to complete the improvements necessary to open the doors. Establishing reasonable expectations is important to ensure that recruitment programs are able to maintain sustained support. Members of the recruitment committee should understand the following “rules of thumb” for retail siting and direct their efforts accordingly:
- For entrepreneurs, it can take as long as five years from launch until they are ready to move into a dedicated storefront space. Providing “stepping stone” opportunities to retain businesses as they move from market vendor to having their own storefront can help cultivate and retain emerging businesses in the district. Similarly, having a plan to regularly reach out to previously identified prospects, such as when a new site becomes available, can be particularly effective at remaining top-of-mind for future site selection decisions.
- It can be tempting to entice an existing business elsewhere to pursue a second location in your district. However, this strategy is often just as risky as recruiting an entrepreneur, since operating a second location is completely different from having a single shop, and many expansion attempts don’t work out. A regional chain opening a third or fourth location is a safer bet, although often more selective in their location choices.
- Understand what the business needs. For regional or national chains, they typically publish their site requirements in terms of location, space and demographic criteria. Know how your district differs from the stated requirements, and be prepared to offer other justifications that outweigh these shortcomings (e.g., the district has fewer daytime employees than desired, but it has a college campus with daytime traffic). Local businesses similarly have a core customer base that will need to be present in a location for the business to be successful. A location near businesses with similar customer demographics is also important.
Although business retention and recruitment are neither glamorous nor fast-moving, they are a critical component of long-term revitalization success. Having a solid complement of businesses that share a common customer base and can benefit from crossover foot traffic and joint marketing makes all the businesses more likely to succeed in the long term. In a downtown, success breeds success, and the healthier the existing business mix is, the more likely other businesses are to seek out adjacent spaces.