This article are provided for information purposes only, and are not intended as legal advice.

How important is drive by traffic for your business?

May 7th, 2010

If you have a retail store or franchise, the most important aspect of location is the traffic that comes to your location.  Are you a destination where people come specifically to your location or do many of your customers come on impulse when they are driving by?  Is all traffic the same?  How important is good neighbours for your business?


Drive by traffic is very important for a retail location however it must be the right type of traffic.  Many years ago, a person wanted to open up a country store in a major city.  They looked at the traffic reports provided by the landlord, over 60,000 cars travel past this location every month.  Huge traffic was driving by this mall.  Based solely on this report, he signed a lease and opened the store.  Unfortunately no business came and eventually he went bankrupt.  What happened?  If you looked at the mall, it was set back quit far from the road.  The tenants in the plaza were not complementary and would not create any walk in traffic.  There was an all you can eat Chinese food buffet.  The people who went to this restaurant when there for a meal and never to shop therefore did not generate any spin off traffic.  There was a pool hall and bowling alley beside him and a used sporting goods store.  None of the customers of these businesses would venture into the country store.


In this case, there was a large amount of traffic who drove past the store but the only traffic which came into the  plaza went to a specific destination and rarely did the person go to more than one destination int the plaza.  The statistics in theory were great of the drive by traffic but they did not help with this type of business.  Whenever you look for a location, you need to factor in many more items then just the number of cars that drove past an intersection.  You can have a great exposure if you are on a busy street but if there is a barrier in the street which prevents people from getting into your store from both directions, will you get business from people going in the direction which they cannot access you easily?


Remember in real estate three key words, location, location, location.  If you are in a poor location, you can have the best business but no one may find you.  You can have a weak business but if there are customers, it can turn into a very successful business.  Many franchises close down locations – why – because the location was not suitable for attracting customers.  Even people who are in the business of finding locations ie master franchisers make mistakes.  When you buy a franchise or buy an existing business, if location is important do your research.  the rent may be higher for a better location but if you get more customers, it may be worth it.  Some small stores can be a destination, for example a party store. I know of one but it is in a busy plaza but when they did a survey, 60% of all people going into the store bought something.  That is a very high success rate.  If you have a location which brings traffic on top of a high rate of converting people into buyers, you should have a very successful business.

Filed under: Business strategies — Gary Landa @ 9:49 am

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