06-16-2015 EDC Meeting - Laserfiche WebLink

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Defining Trade Areas Using Focus Groups Defining trade areas is sometimes more of an art than a science and no one method is always correct.Whatever method you choose to define a trade area(including convenience and destination trade areas), make sure the area you ultimately delineate represents the entire business district or community. If a trade area is too small or too large,your demographic and spending calculations based on that area will be unrealistic and of questionable value. Focus groups help you ensure that your trade area will be broadly representative.Two methods for defining trade areas using focus groups are described below. Business Owners Focus Group Approach Experienced business owners typically know their customers well.Asking a group of business owners or operators to undertake a focus group mapping exercise is an efficient way to define your trade area. Video: Focus Group Approach to Defining a Trade Area �.. Focus Group Approach to Defining a Trade Area Ryan Pesch Urwersdy of Minnesota Extension EXTENSION Steps for Conducting a Business Owners Focus Group Trade Area Exercise: • Hand out printed maps of the general region with a couple rings drawn on the map (typically 5-and 10-mile radii)to give a sense of distance. • Explain to participants that a local trade area is the area in which a majority of the local customers live(often defined as the area where 75 percent live). Communities can have significant number of customers who are seasonal customers,tourists,or other visitors, but the focus here is on local residents. • Explain that individual businesses have their own trade area.A destination business like a furniture store typically has a larger trade area than a convenience business like a gas station or grocery store. For this exercise, participants must not think in terms of their individual business, but rather in terms of the entire business community.Another way of framing the idea of a community trade area is to ask participants to visualize various 6