Your Site Selection Will Be Transformed With A Customized Model-Based Approach
When it comes to long-term success, site selection is one of the most important decisions your company will make. If your site selection partner isn’t relying on a model-based approach, you could be leaving that decision to chance.
Companies underestimate the importance of the neighborhood
Most site selection firms start their analysis with a list of available locations, and only THEN consider the neighborhood as a almost an afterthought. Their typical process is:
- Determine your facility requirements.
- Search available properties for those that meet your requirements.
- Review some basic demographics, such as population and income.
- Show you the matches.
The problems with the traditional approach
When you’re making a decision as momentous as your next location, access to the right information can be the difference between success and failure. Here are some of the drawbacks of that rudimentary method of site selection:
Wrong priority: Facility requirements like building size and egress are important, but even more important is the neighborhood and who lives there.
Wrong assumptions: It’s easy to assume what’s important, but frequently those assumptions are wrong. A common misconception is that higher average income is always better, but the data does not support that.
Wrong assumptions: Assuming we know exactly what the appropriate drive-time is for a location can lead to the wrong conclusions – and that’s just one example of the many assumptions that make what looks like a great location a costly mistake down the road.
Wrong reasons: Choosing a location based on what’s available, rather than what’s appropriate.
Successful site selection decisions focus on the “who”
On the other hand, our model-based approach focuses not just on the where, but also on the “who” – as in who lives nearby. By first answering why your existing locations are successful based on area psychographic factors we can help you find an area – a where — that promises the same factors. Here’s how it works:
- We build a model of your existing locations, integrating dozens of area-related data points with historical performance.
- Our team determines which of those data points correspond to success and eliminates those that don’t.
- We tabulate the relative importance of each remaining data point.
- Once that “why” process is complete, it’s time to start on the where. We’ll analyze your prospective locations and give each a revenue prediction score.
- We’ll produce a list – and a map – showing you what the revenue prediction score is for each.
- Now it’s time to bring in the real estate broker you trust, who can show you the available properties within the highest scoring locations.
Advantages of our site selection process
Taking the extra step of developing that model and implementing it during your site selection process will give you several advantages as you determine where your next location will be. Those advantages include:
Prioritize what’s important: You don’t have to waste time looking at properties that don’t meet your needs or present an opportunity for success.
Eliminate conflicts of interest: By separating the decisions of general area and specific location, you’ll be avoiding the possibility that your real estate professional is directing you to properties with a high profit margin for them rather a high chance of success for you.
Sharpen the focus: Your new model will give you a laser focus on appropriate locations, reducing the chance that easy availability will sway your decision.
Base your decision on reality – rather than assumptions: Our predictive models are based on historical performance and robust psychographic analysis rather than assumptions about what might work.
Increase possibilities for corporate profitability: A new location chosen with our site selection model is based on what works for your specific business and is tailor-made for your company’s future success.
Ready to unleash the power of the model approach to site selection?
If your site selection partner isn’t using a model-based approach to help you determine your location, are almost certainly exposing yourself to unnecessary risk.
Click here for a free consultation about how OpenDoorData can develop your site selection model and craft a process that leads to future success.