LOCATION AND LAYOUT AS SOURCES OF COMPETITIVE ADVANTAGE OF SMALL RETAILERS

Nikola Knego, Kristina Petljak and Rudolf Vouk

Economy & Business Journal, 2014, vol. 8, issue 1, 267-281

Abstract: The decision about the location is one of the most important decisions taken by the retailer because of its long-term impact on the company. In each step of the decision making process retailers have to analyse to what extent the characteristics of the location meet the specific requirements of their businesses. The secret of choosing the right location lies in knowing the factors that are most important to the firm's success and finding a location that satisfies them the most. Retailers must take into account the size of the trading area, parking spaces, availability of space for expansion and location visibility. Crucial for identifying appropriate location is to identify the characteristics that can provide the small retailer with a competitive advantage and then find potential sites that meet these criteria. After deciding on retail location, retailers have to consider store layout. Layout is important for attracting constant customer turnover. Store layout develops from a good knowledge of the consumers’ buying habits. Retail spatial distribution should attract customers to the store and facilitate them to choose the goods, compare prices, quality, characteristics, and finally to facilitate the purchase. This is an area where small retailers can have a big advantage over its competitors. Small retailers allow customers to find the products they want quickly and easily. Customers make a significant percentage of their purchase decisions as soon as they enter the store, meaning that a suitable store layout can significantly increase sales.

Keywords: retailing; small retailers; retail location; location decision making; store layout (search for similar items in EconPapers)
JEL-codes: A (search for similar items in EconPapers)
Date: 2014
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