Trade Area: Types of Business Locations

A trade area is an area where the retailer attracts customers. It is also called the catchment
area.

Three basic types of trade areas

Solitary Sites

These are single, free standing shops/outlets, which are isolated from other retailers.
They are positioned on roads or near other retailers or shopping centers. They are
mainly used for food and non-food retailing, or as convenience shops.

Advantages − Less occupancy cost, away from competition, less operation restrictions.

Disadvantages − No pedestrian traffic, low visibility.

Unplanned Shopping Areas

These are detailed locations that have evolved over time and have multiple outlets in
close proximity.

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 ● Central business districts traditional “downtown” areas in cities/towns
● Secondary business districts in larger cities and main street or high street locations
● Neighbourhood districts
● Strip or string locations (locations along a street or motorway).

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Advantages- High Pedestrian traffic during business hours, high resident traffic, nearby
transfort.

Disadvantages- High security required, threat of shoplifting and poor parking facilities.

Planned Shopping Districts

Planned shopping areas are retail locations that have been architecturally well planned to
provide a number of outlets. These sites have large, key retail brand stores (“anchor stores”)
and a few stores to add diversity and elevate customers' interests. There are various types
of planned shopping centers such as neighborhood or strip/community centers, malls.
Lifestyle centers, specialty centers and outlet centers.

Advantages- High visibility, high customer traffic, excellent parking facilities

Disadvantages- high security required, high cost of occupancy