Determining Selling Space

I've always been curious as to how retailers figure out what size their stores should be. It's clear that one size doesn't fit all, but how to they find that perfect fit? Most of F.C. Dadson's clients approach us with an ideal square footage already in mind, so there isn't much talk around the office about that part of the store opening process.

But, lo and behold, the answer came to me this morning as I was hunting for fodder for this Diaries entry. Turns out there's a fairly simple equation that retailers can use to determine the amount of selling space their stores should have.

Selling Volume / Sales per Square Foot = Selling Space

where
Sales Volume = your store's planned sales volume and
Sales per Square Foot = your industry's average sales per square foot stat.

See, it's pretty simple. Ok, it does require some thought and research to solve and you'll have to remember to tack on extra square footage for things like storage and bathrooms, but it's a start anyway.

And it's another retail mystery solved -- at least for me it is.