When you’re planning a shopping center or mall, you must not only make sure you fill the openings, but that you do so with stores that are actually going to succeed. You can’t put a high dollar designer store in the mall of an area with a median annual income of less than $50,000 a year. They just simply can’t afford to pay for it, so they won’t, and your mall will cease to exist. You have to cater your stores to your customers! You can’t hope that enough people from other areas will come to keep your mall afloat. If you want to make money, and do it with a solid customer base that keeps expanding, tailor your stores to your customers!
Let’s start with the example of opening a shopping center in an area with a median household income around $45,000 and less than 30% of the population with a Bachelor’s degree or higher. There is less disposable income to spend a lot of money on things like clothing, so discounted clothing stores, like Rue21. Other popular “less expensive” stores of this category are Children’s Place and Charlotte Russe. Basically it’s stores where you can get clothes that look nice, but for less money than designer stores.
If we change it up a little, and move the median income up to $50-55,000, and increase the percentage of the population with a Bachelor’s degree to up to 35%, the options change and open up quite a bit with respect to stores that people actually shop at. Old Navy, Motherhood Maternity, Lane Bryant, Victoria’s Secret, Gymboree and Gap are stores that are generally found in areas and shopping centers like this one. These stores tend to cost a little more than the ones from the last category, but still fall short of “designer” styles and prices.
In the last category, you have those making up to a $65,000 median household income, with up to 37% of the population having a Bachelor’s degree or more. Here our options open up even wider! Stores like Abercrombie and Fitch and J.Crew pop up in malls. Of course these stores still aren’t Louis Vuitton, but we’d need to go substantially above $100,000 a year for those stores to be anywhere near feasible. You can get fashion forward clothes at lower prices too, it’s just not dubbed “designer”.
Doing your research about what area you’re building in, and the type of people that live there, is essential to making sure that you keep customers coming. Without this essential planning, you may end up with a full mall at the beginning, and then a lot of empty spots the next year when they can’t make enough money to stay in business. If the stores in your shopping center stay in business, so do you! Make your opening decisions count!