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Exercise
Site Selection: Choosing the Right
Location
Section 3 Exercise 1
April 29, 2021
The Location Advantage MOOC
Instructions
Use this guide and ArcGIS Business Analyst Web App to reproduce the results of the
exercise on your own.
Note: ArcGIS Business Analyst Web App is a dynamic mapping platform. The screen
captures that you see in course materials may differ slightly from the version of Business
Analyst Web App that you will use.
Time to complete
Approximately 30-45 minutes.
Technical note
To take advantage of the web-based technologies available in ArcGIS Business Analyst
Web App, you need to use a fairly new version of a standard web browser, such as Google
Chrome, Mozilla Firefox, or Microsoft Edge. Older web browsers may not display your
maps correctly.
Introduction
In this week's lesson, you learned about evaluating sites to identify the ideal location for a
new or expanding business. There are multiple business questions associated with this
situation, and you can answer many of them using geospatial techniques and the four-step
question-model-analyze-interpret workflow. In this exercise, you will use the analysis tools
available in the ArcGIS Business Analyst mapping platform to support decisions related to
business-site evaluation and selection. You will visualize data variables on a map to match
your target characteristics. Then, you will identify the best location.
Exercise scenario
In this scenario, you are a business analyst at Natural Foods, a fictitious natural and organic
grocery store. Corporate management has asked you to find the best site for a new store
location around the cities of San Bernardino and Redlands in California.
You have been provided with a list of the parameters that Natural Foods typically uses for its
new stores. You will need to consider these criteria in your site optimization analysis. The new
store site should be located in an area with these attributes:
In this exercise, you will use Business Analyst Web App to perform these tasks:
• Create a web map to show the demographics of an area, including household income,
home values, education level, and propensity to shop for natural or organic foods
• Search for possible competition in an area
• Import map layers with city zoning and real estate information
• Create a report with extra information, such as traffic counts
Approach
You will again use the question-model-analyze-interpret workflow for decision-making so that
you can standardize the approach to optimizing business decisions.
To create a map that shows potential Natural Foods sites that meet management's new-store
criteria, you will need several types of data:
• Demographic information about the population around the cities of San Bernardino and
Redlands in California
• City zoning information
• Information about the competition (other grocery stores) in the area
• Available real estate leasing information
• Traffic information
on the company's criteria for a new store. You will examine the local consumer population.
Then, you will analyze the level of competition in the area. Finally, you will add additional
layers to your map for analysis, including zoning districts or areas and real estate information,
such as available leases (with cost, square footage, parking, and so on). The results of the
analysis can be reviewed and interpreted as part of the larger decision about where to locate
a new store.
Interpret the Findings
After following the analysis workflow steps to reveal your findings, interpret the resulting
information to inform decision-making efforts. You will be armed with accurate and useful
information about the location, potential customers, and competitors.
b To access Business Analyst Web App, click ArcGIS Business Analyst Web App or navigate
to the URL https://bao.arcgis.com/esriBAO/login/.
d Sign in to Business Analyst Web App using the same credentials that you use to access
ArcGIS Online for this course.
The user name and password are the same as for the ArcGIS Online organizational site for this
course. Because Business Analyst Web App is available as an extension to ArcGIS Online, it
uses the same login information, although it has its own web address.
If you have more than one ArcGIS Online account, be sure to use the account created for
this course. You can only access the maps and data for the exercises if you are signed in to
the ArcGIS Online organization created for the course.
Note: The Section 1 Exercise 1 PDF explains how to determine your ArcGIS Online credentials
(user name and password) for this course. If you have trouble signing in, please refer to the
Common Questions list on the course Help tab.
Your previous project opens by default.
d Click Create.
f Point to the Natural Foods Southern California project thumbnail and click Open.
After the project is created and opened, the Maps tab opens with a preselected basemap.
You will configure the map to show the area of interest—in this case, the area of San
Bernardino and Redlands in southern California.
h In the upper right, above the search field, verify that the country is set to USA.
i In the upper right, in the search field, click the down arrow and choose Zoom To An Area.
m Click the Basemaps button again to close the basemap options window.
Natural Foods conducted some initial market planning and analysis to discover potential areas
for the new store. The area bounded by San Bernardino to the west (to the left on the map)
and Redlands to the southeast was identified as the most desirable in the greater southern
California region. This area is most likely to contain a site that meets all your criteria. You will
start with this area and narrow down your options to the best actual site locations by using the
process of site evaluation and selection.
First, you will learn a little more about the area of San Bernardino and Redlands.
a From the Maps tab, click Create Maps and choose Color-Coded Maps.
b In the left pane, in the search field, type natural/organic and press Enter.
d If necessary, in the Variables column, expand the 2020 Health (Market Potential) result.
e For the 2020 Buy Foods Specifically Labeled As Natural Or Organic variable, click the
percent button to map the variable as a percentage rather than as a quantity.
You can see that, particularly to the east (to the right on the map) and southeast, the area has
consumers who buy natural or organic foods—your target demographic. The information from
this map agrees with the market planning analysis and supports the decision to choose a
location in this area. Further, the map suggests specific locations to start with.
Obtaining the right data can be the most difficult part of analysis. For the most accurate,
reliable results, having good data is just as important as having good software tools. Ideally,
the data comes from a known, reputable source and includes metadata that describes how
and when the data was collected.
The following link describes the large dynamic dataset included with Business Analyst: https://
doc.arcgis.com/en/business-analyst/web/data.htm
You can also read through the following presentation to learn more about data quality:
https://sway.office.com/vFHqEIn3iGojHF29
Note: If you ever lose your map, or if you need to sign out and sign in again, you can still
access your latest work. Click the All Projects icon, point to the project, and click Manage
Items. This area contains all your recent sites, polygons, and other layers, which are
automatically saved when you make updates.
b Change some settings, such as the symbolization or transparency of the overlay, to see
how the settings affect the map display.
You can also change Method, which is the statistical method used to classify the data.
Classifying data means breaking it out into classifications or categories so that different
symbols or colors can be used to visualize the data on a map. Most methods used to create
the classification schemes consider a statistical property, called the distribution of the dataset,
to best show the differences or similarities among values in the areas on a map. Business
Analyst allows you to classify the data in three ways: natural breaks, equal intervals, and
quantiles.
Note: To learn more about using classification methods, see ArcGIS Business Analyst help:
Color-Coded Maps > Method.
c Next to Labels, check and uncheck the Place and Road boxes to see how labels display
over the data and the basemap.
Labels can help you get oriented or present information.
It is important to remember these map visualization settings when preparing a map for saving,
printing, or sharing.
d After you are finished exploring various settings, proceed to the next step.
a On the right, from the toolbar, click the Clear Map button.
c From the Maps tab, click Add Data and choose Web Maps And Layers.
This option shows you items in your Business Analyst and ArcGIS Online content, along with
shared items from your organization and the general public.
d At the top of the Web Maps And Layers dialog box, click ArcGIS.
g Point to the RedlandsZoning feature layer owned by EsriTrainingSvc and click Open.
h Zoom and pan to the Redlands area as necessary to see the different zoning
classifications.
Zoning data is available from the city of Redlands in accordance with its open data policy.
Many government agencies publish location data under similar open data policies, so such
data is increasingly available on the internet.
Note: Open data refers to the growing practice of providing data for others to use without
restriction. Goals of this practice include furthering scientific knowledge and increasing
transparency in government. Location data is useful in both scenarios, as well as in business.
You can easily obtain such data to further increase your location advantage.
Esri facilitates the distribution of open data through a product called ArcGIS Hub. Hub
promotes engagement and collaboration with communities. This link takes you to the hub site
used by the city of Redlands: https://opendata-coredlands.opendata.arcgis.com.
For this exercise, the dataset has been simplified to eliminate needless complexity and allow
clearer conclusions.
j To the right of the RedlandsZoning layer name, click the More Options button .
k Point to Transparency, then drag the slider to the right as needed to see the basemap
underneath the layer.
Having identified and mapped some of the criteria for a new store location and further
narrowed down the search, you will learn about the degree of potential competition in the
area.
You will create a search for grocery stores in the area to learn more about the possible
competition.
a From the Maps tab, click Create Maps and choose Business And Facilities Search.
b On the Business And Facilities Search pane, in the search box, type grocer and click Go
or press Enter.
Your map display updates. There seem to be several potential competitors in the area. The
stores are displayed as clusters on the map. If you click one of the numbers, a pop-up will
display information about the stores in each cluster.
On the left, you can scroll through categories for filtering the data. Under Business Name, you
could filter out grocery stores that you know do not focus on natural or organic foods. By
setting parameters for Number Of Employees and Sales Volume, you could find stores that
are similar in size to Natural Foods.
c At the bottom of the Business And Facilities Search pane, click Next, click Next again, and
then choose Save Layer.
Note: If you receive a warning about credit consumption, click OK, and then click Continue.
e If you have download capabilities, click Export To Excel to see the competition layer with
full attribute information. Save the spreadsheet locally on your computer in an easily
accessible location.
f On your own, examine the Excel spreadsheet to discover details related to your
competition.
a Open another tab in your browser, and go to the RedlandsRealEstate shapefile (https://
bit.ly/3xk3S3O).
d Close the browser tab with the RedlandsRealEstate shapefile and return to Business
Analyst Web App.
e From the Maps tab, click Add Data and choose Import File.
g Browse to the location on your computer where you saved the zipped RedlandsRealEstate
shapefile, select the file, and click Open.
k At the top of the pop-up, enable Classic Symbols and choose the green flag.
l Click Done.
n Under Choose Column For Site Name (Optional), click the down arrow and choose
Details.
o Click Save.
Examine where the real estate locations appear on the map and how the locations relate to
both the zoning areas and the competition. Look for sites that are located in or near the areas
noted earlier as being both close to target customers and within an area zoned for
commercial use. Which sites should be analyzed further? Can any be ruled out?
r Compare the sites on these criteria: leasing cost, size, and amount of parking.
Recall that you need between 25,000 and 50,000 square feet, less than $20,000 per month in
cost, and at least 100 parking spaces.
Hint: Criteria can be found at the top of the pop-up.
b If necessary, expand Other Layers and locate the RedlandsRealEstate imported points
layer.
c To the right of the RedlandsRealEstate layer, click the More Options button and
choose Setup Layer.
To create sites from point data, you can create rings with a set radius from each point. You can
also create sites based on drive times for cars or delivery trucks from each point or based on
walk times.
d In the Setup Layer pane, under Use Field As Item Name (Optional), click the down arrow
and choose FullAddres.
e Under Create Buffers Around Selected Points, click the Walk Time tab.
f Change the time in the first box to 15, and delete the numbers in the other two boxes.
This step creates a single walk time area that shows what is reachable by foot within 15
minutes.
h If necessary, zoom and pan the map display to see all five sites.
After the new site layer is created, you have the option to use it for further analysis.
c Click Next.
d In the Suitability Analysis pane, click Add Criteria and choose Add Variables From Data
Browser.
1. From the Income category, add 2020 Median Household Income (Esri).
• Hint: Click the Income category icon and look in the popular variables.
2. Add 2020 Median Home Value (Esri).
• Hint: In Categories, search on home value and expand the 2020 Home Value
category result.
3. Add 2020 Education: Population Age25+: Bachelor's Degree (Esri) as a percent (%).
• Hint: Click the Education category icon and change the type to percentage
before checking the box.
4. Add 2020 Buy Foods Specifically Labeled As Natural Or Organic as a percent (%).
Above-average income, home values, level of education, and percentage of people who
prefer natural or organic foods represent the more detailed population characteristics that
Natural Foods wants near the store site it chooses.
Note: If you need help or more detailed steps for finding variables using Data Browser, refer
to the Section 2 exercise.
After you add these data variables, the Selected Variables count in the Data Browser window
should show four selected variables.
f Click the Selected Variables count and verify that you have the correct variables, and that
the college-educated people and people who buy foods specifically labeled as natural or
organic variables are set to percent (%).
g Click Save.
h In the Save Criteria dialog box, name the list Natural Foods suitability.
i Click Save.
j If necessary, zoom or pan the map display to see all the sites.
The default color ramp shows darker colors for the more desirable sites, which refer to the
15-minute walk-time areas around each real estate point.
k If necessary, expand the Suitability Analysis Results table at the bottom to learn about the
weighted and final scoring for each site.
Note: Pausing your pointer over a row in the table highlights the area on the map.
l In the Suitability Analysis pane, move the sliders for each of the four criteria.
Note: You can use either the sliders or the text boxes to set the weights. To type in the text
boxes, you may need to use the number keys at the top of your keyboard rather than the keys
on your number pad.
m Notice the changes in both the features in the map and the scores in the table.
You can see that increasing the weight of one variable automatically decreases the weights of
the others so that the weights always add up to 100 percent. The weights are what make
some areas appear more desirable than others. For example, increasing the weight of the
median home value variable shows that the areas to the east are more desirable. If Natural
Foods places greater importance on the percentage of natural/organic food shoppers and
higher education levels, however, the areas to the west appear more desirable.
You can click More Options under each variable for more settings. You can also click the lock
icon to lock a variable so that it doesn't automatically adjust.
You now have more information about which specific areas around each real estate
opportunity may or may not be ideal for your new store location. You can export these results,
either as a spreadsheet or as a new suitability layer.
o Select Export To A New Suitability Layer and check the box next to Include All Site
Attributes In The Suitability Analysis Export.
p Click OK.
a On the map, click the point that seems like the best possible site for a new store location.
It can be any of the five points.
c Under Choose A Report To Run, click the down arrow, and then scroll all the way down
and choose Traffic Count Map.
You can print or save this report along with the map image that you saved earlier.
The traffic report could help confirm your thinking that this is the best place for a new store
location. Or you could run reports on another site for more information.
As you interpret the findings, build a case for which site you believe is most suitable and why.
Do the combinations of existing parameters put one site ahead of the other, such as lower
cost, more parking, or more favorable demographics? There are usually even more factors
that you must consider when making such a big decision. What other possible criteria can you
think of? Remember to look to the future: Are there plans to add a commuter train stop near a
potential site? Consider ease of access to transportation: How close is each location to the
nearest highway off-ramps, and which side of the street is each location on when traveling
from those access points? Here are some additional variables that management might also
want to consider:
a At the top of the Business Analyst Web App window, click your name and choose Log
Out.
Conclusion
In this exercise, you evaluated sites for a new business location. There are many factors to
consider when making such a potentially high-profile, high-cost decision. As you have
learned, considering quantitative variables, like costs or traffic counts, can help provide a solid
basis for a recommendation. You can explore many different datasets in Business Analyst that
cover a wide range of demographic, business, and consumer characteristics.
What further variables do you think could be useful in performing site optimization? There are
probably more qualitative, harder-to-measure variables to consider in a search like this, such
as neighborhood feel, sense of place, perceived relative noise, or other factors. How can you
take this analysis a step further? You are encouraged to take these tools, access the data, and
see what other information you can derive or what else you can learn.
You began this exercise with a business question: Within a chosen area, what is the ideal
location for your business? You used information available in Business Analyst. You modeled
the solution by combining the data with techniques to answer the question. You can apply the
techniques you used to other similar situations as well:
• Locating a military or college recruiting agency near wherever the potential recruits or
students live
• Locating a food delivery business in an area where people tend to have more disposable
income but fewer cars
• Locating a different part of the business, such as a manufacturing plant, farther from
consumers but near where potential workers live
• Locating the best place for a new office complex, which would need parking spaces,
zoning, restaurants in the vicinity, and so on
Most importantly, act on your findings. Do not let your findings simply be documented in
reports and archived (although those are good ideas, too). Your analysis results should also be
integrated where possible. The datasets and maps can be added to reports or dashboards in
your business intelligence systems to be made accessible or distributed, for example. Putting
your findings to use increases your competitive advantage: the location advantage.