?_Rasmussen:

[system]

Hi, I am putting a business plan together and have received a demographics package from local leasing agent of the area we would like to open in. How do I use those numbers to reflect the percentage of homes or workers in the area that would contribute to sales. I’ve heard of the 1% fallacy trap and I want to present realistic figures. Do you have a magic number that could represent consumers to figure potential daily sales? Thanks for your time

 

[j_r0kk]

For stores with little or no Brand recognition, you’re looking in the range of 33 cents to $1.00 per address in weekly net sales. For stores with a little more Brand recognition, you can go from 75 cents to $4.00 per address.
One rule of thumb: Bigger cities will yield smaller returns (i.e. 30 cents - 75 cents per addresss for stores with high brand recognition). Hope this helps a little. -J_r0kk

 

[system]

Thanks. That’s very interesting. Now, how does that calculate with 1,3,5 mile ranges on household figures. Also, that I think takes care of my evening traffic, if I’m in a fairly dense population condusive for lunch, what are the possible percentages on that? Hopefully, I’m not making this too complicated. Thanks again.

 

[j_r0kk]

Thanks. That’s very interesting. Now, how does that calculate with 1,3,5 mile ranges on household figures. Also, that I think takes care of my evening traffic, if I’m in a fairly dense population condusive for lunch, what are the possible percentages on that?

The numbers I gave you can be considered good “indicaters” on what you can expect out of a carryout/delivery store. Of course, some stores may be way off in one direction or the other (hopefully, in your case, the good direction). These numbers are based on total households within an 8-10 minute radius of your store. You really can’t count on anything further out than that.

As far as lunch… LOL… you’re asking the wrong cat. I’m having troubles with that myself. -J_r0kk