Many retailers today have moved beyond traditional strategies of determining locations that were not much more than "hunches" about performance based on matching paper maps with basic demographics like population density, incomes, age and competition locations, says Walter Wahlfeldt, executive vice president, retail corporate services at JLL, a global real estate consulting firm.
These days, retailers and restaurants are trying to advance their capabilities to select sites by gathering and leveraging as much data as possible, he
In addition, franchisors need to understand that site selection tools and services are not "magic boxes" that make perfect predictions, says Wahlfeldt
However, the analytical tools do reduce the risk considerably when it comes to site selection, which makes the money spent on such technology well worth it for many operators.
"Even if the services help to avoid only one bad deal, the development and operating costs of single locations can be so high, that avoiding that loss can more than pay for the initial investment in analytics," he