Place, distribution, channel, or intermediary

• Lesson
• Exercise
• Answer

Here’s a recap of the short case. The answers are below.

Welcome to Newtown. It sits 25 miles from Commerce Town, 10 miles away from Friesner Airport, and 35 miles away from Poshbury.

Option 3 is the preferred option, followed closely by option 1. How did you get on?

Which place would you recommend to Floor-Mart? Justify your recommendations.

Answer:

Floor-Mart are considering where to put their new store. Their store will sell groceries and provisions 24 hours a day (at a premium price of course).They have three options, each one is considered below. You must recommend a place for the position of the new store.

• This site is next to Commerce Town. It has very few inhabitants. However 7,000 people travel there everyday to go to work. It already has a competing store (C). There are plans to build low cost housing in the area.
• This site is very close to the exclusive Poshbury. It has 1,000 very exclusive, wealthy inhabitants. There is no competition in the locality.

Evaluation of the three options:

• Commerce Town has very few houses. Most of the people that visit it are working. However this could be an advantage if people went shopping during their lunch or after work. There is a competitor in the locality. The future will see a new low cost housing, so there is potential for the long-term.
• If Floor-Mart were to locate here there would be no competition. The problem with this location is the lack of inhabitants. With Poshbury being so exclusive, further building is unlikely.
• The final location is has a large population. It is also on the main route between Newtwon and the growing Friesner Airport. People could shop on their return from work since Floor-Mart is open for 24 hours every day.