High-end grocery stores typically tend to settle into established neighborhoods where incomes — and property values — are high. But a new move by one of the biggest organic grocers into downtown Detroit has some in the retail industry scratching their heads.
Not so for home owners — those that live around existing locations already know that the fancy food retailers come with many perks, most importantly, higher re-sale values for their homes. But for the retailers themselves, the move into Detroit seems to be quite a leap of faith, according to a recent article in The Wall Street Journal.
But, if you look more closely, it becomes more obvious why a downtown location — even in one of the most notoriously abandoned cities – is smart for business. For this high end grocer’s latest venture into Detroit, there are many attractions, including proximity to a hospital, university, and art museum. There are also signs of a neighborhood on the rise, spurred by tax breaks and other business incentives. Companies are moving back to the city, and retailers like this high-end grocery chain are taking note.
Studies have shown that promising locations in up-and-coming neighborhoods offer high traffic and great profitability. They drive traffic and sales up while the rates of theft in the stores are lower.
Source: WTOP – 103.5 FM, March 2012