Treasure Islands Foods Company: Feasibility Study Case Study

Abstract

The relevant feasibility study is aimed at providing an evaluation of Charleston sites available for allocating Treasure Island Foods. Basing on the analysis of the area, one has selected three sites that are most likely to meet the customer’s demand. A set of criteria has been applied to evaluate the feasibility of these sites; the findings obtained are represented below.

Introduction

The feasibility study at hand is aimed at providing Treasure Island Foods with a detailed report on the available locations for their store in Charleston, Illinois. One carried out a profound analysis of the local market and sales rates in order to perform an accurate evaluation of the available sites. The study is comprised of three main stages: data collecting, market analysis and generation of conclusions. In order to provide a competent evaluation of available locations, one worked out a set of criteria basing on the current trends and the most efficient practices in the modern market. The selected criteria are aimed at evaluating the aspects that are most critical for the successful performance of a food store.

In the course of the research, one pointed out three available options and tried to provide an objective evaluation of their benefits and weaknesses.

Thus, the relevant feasibility study presents the analysis of the following locations: Lincoln Ave, Eastern Illinois University; Douglas Street, Lafferty Park; Taylor Avenue, Housing Sector. One might see the town map in Appendix 1 to receive a better idea of the locations’ specificity. The three sites were examined from the standpoint of their proximity to public transport, potential consumer flow, and the presence of other food stores within the selected area.

The data collection was carried out via observation, the examination of available statistics and supplementary web sources.

Methodology

The design of the study was developed in accordance with the ultimate goal that implied finding the best location for opening the Treasure Islands Food store. Therefore, one initially employed such a data collection tool as a literature review in order to receive a full and detailed idea of the relevant area in the context of grocery facilities. Another method implemented in the study was the quantitative analysis of the available statistics that helped one evaluate the principal customer demands and their paying capacity basing on the information about the age, occupational status and the average income of the residents. The examination of the statistic also enabled one to point out the targeted population groups that are likely to comprise the potential clientele of the store.

Criteria

In order to evaluate the feasibility of a particular site, one applied the following criteria:

• the site’s proximity to the transport links;
• the site’s remoteness from other food stores;
• the intensiveness of potential customer flow;
• the size of the territory available for construction.

The criteria were selected on the basis of the analysis of the relevant literature. According to the marketing analyst, Harlan Spotts, lack of neighboring competitors and the intensiveness of customer flow play a crucial role in choosing a feasible location for a grocery store (Spotts 97). Therefore, one believes that a feasible site should be easily accessed by any type of transport so that potential clients from other areas can visit it. Moreover, one expects that a feasible location should be relatively far from other food stores in order to reduce the level of competitiveness. Another critical point is to choose a maximally crowded place to assure a constant and sustainable flow of customers. Finally, the size of the analyzed location is to be sufficient for constructing the store as well as the parking lot.

Conclusions

The analysis of the local market has shown that the town has four large food stores that might create a competitive factor for Treasure Island Foods. According to the statistics, the highest density of population within the area is in the educational quarters (“Charleston Township” par.17). Thus, the full-time enrollment in the local university makes 9.414 people.

The overwhelming majority of the locals prefer cars to public transport. Hence, over 70% of the total population has one or more cars in the household (“Charleston Illinois” par.14).

The major part of the residents is employed, and the average income around the township is approximately $30.000 per year (“Charleston Township” par.24).

The collected data concerning the key aspects concerning the area is represented in the table below.

Table 1 “Charleston Statistics”.

The profound analysis of the available sites-enabled one to prepare brief overviews of three locations that seem to be the most feasible.

Location “A”: Lincoln Ave, Eastern Illinois University

Location “A” is the 5.000 square meters site situated near the Eastern Illinois University, on Lincoln Ave. The location represents a good site due to its proximity to the University and street network. The size is likely to accommodate a full assortment store that might generate sales of about $90,000 to $100,000 per week. Meanwhile, there might be some problems with parking because of the unfavorable proximity of the crossroad. There are no big food stores in the area; thereby, the sustainable flow of students will comprise the major part of the clientele.

• Advantages: proximity to transport links, remoteness from other food stores, assured customer flow.
• Disadvantages: potential difficulties with parking lot construction.

Location “B”: Douglas Street, Lafferty Park

Location “B” is the 3.500 square meters site situated near the Lafferty Park, which is the main recreation zone in Charleston. The location represents a good site due to the constant flow of people in the city center, particularly at weekends. The size is likely to accommodate a limited assortment store; therefore, the sales are likely to be reduced to about $60,000 to $80,000 per week. One of the key disadvantages of this location is its proximity to another big food store situated 1.5 miles away from the site. In the meantime, the site has a beneficial location from the transporting access perspective.

• Advantages: proximity to transport links, assured customer flow.
• Disadvantages: limited size, proximity to another food store.

Location “C”: Taylor Avenue, Housing Sector

Location “C” is located in the housing sector on Taylor Avenue. The site is approximately 10,000 square meters. The principal drawback of the relevant location is the lack of public transport access and its remoteness from the road; potential clients will have to reach the store by car or on foot. Meanwhile, there are no food stores in the area, whereas the sector is densely populated. The large size of the territory available for the building will let one establish a full assortment store with a large parking lot. The presumable amount of sales that the store might generate per week is $90.000.

• Advantages: big size, assured customer flow, remoteness from other food stores.
• Disadvantages: remoteness from transport links.

Recommendations

In order to provide the rationale for the recommendations, one would like to illustrate the comparative analysis of the three sites. The data for comparison is represented in the table below.

Table 2 “Comparative Analysis”.

Therefore, one might see that Site “A” shows the best results matching all the criteria set for the feasibility test. One assumes that Treasure Island Foods can find alternative solutions in order to resolve the problem of the limited size of the location. For example, an underground parking lot can be constructed to provide clients with essential parking facilities.

In order to receive a better idea of the recommended location, one might refer to the schematic represented below.

Discussions

In order to explain the factors determining the choice of Site “A”, one should necessarily provide a detailed analysis of every location in the framework of the set criteria. First, and foremost, it is essential to elucidate the criteria set for the feasibility test and to justify their validity. The primary criterion is the site’s proximity to transport links. One needs to note that the majority of specialists in marketing agree on the point that this criterion should be included on the top list of significant aspects in the food store industry (Moore, Bruce and Birtwistle 88). The relevant aspect is of high importance as it is directly connected with the intensiveness of potential customer flow. The proximity to the road increases the chances of attracting new customers to the food store. Apart from the loyal clientele, one is assured to have a certain number of casual visitors.

The next criterion suggested for the feasibility test implies the remoteness of other food stores from the site. In the case of such a small town like Charleston, one is recommended to avoid a competitive neighborhood if it is possible. Taking into account the fact that the town has only four large food stores, finding a site remote from competitors is not problematic.

The intensiveness of customer flow is another criterion critical for carrying out a valid evaluation. Thus, specialists note a sustainable customer flow is the determining factor of the efficient performance (Moore, Bruce and Birtwistle 94). One assumes that the intensiveness of customer flows depends on its proximity to either large organizations or to the densely populated housing sectors.

The final criterion selected for evaluation is the size of the analyzed location. The significance of the relevant sector is evident as the size of the area available for construction is expected to allow one building a full assortment food store and an adjacent parking lot.

Thus, location “A” is situated not far from Eastern Illinois University that is the main university in the town. The examination of the relevant area shows that students and professors have no options for buying food within a radius of three miles. Therefore, the remoteness of other stores and the proximity to the densely populated university campus adds to the benefits of the relevant location. One might suggest that the major part of the clientele will be comprised of the university members. However, the proximity of the university is not the only beneficial aspect of the site’s location. The site is situated close to three streets that show to be rather crowded during the day. As a result, one might assure a constant and sustainable flow of customers.

Another advantageous factor is the proximity of transport. Thus, the future food store might be easily reached by bus or by car.

The only flaw of the analyzed site is its limited size. The area will accommodate the food store itself while constructing a spacious car park that will be rather problematic.

Location “B’ is less favorable from the size perspective. Thus, the limited area available for construction will not allow one to build a full assortment food store. The relevant factor is likely to influence the general amount of sales expected at this site. Moreover, the site is located close to another food store that offers a similar range of products as Treasure Island Foods. In case the company chooses this site for building their food store, they will have to work out additional strategies to gain competitive advantages.

Nevertheless, from the standpoint of customer flow and proximity to transport links the site has a favorable location. Thus, one might find a park close to the location “B”, which is very popular with the locals. The site is situated at the crossroad of busy streets; thereby a sustainable flow of customers is assured. One presumes that the intensiveness of customer flow will slightly vary on workdays and at weekends. This assumption is determined by the proximity of the recreation zone that attracts the largest number of visitors on Saturdays and Sundays. Lastly, the location of the site enables one to reach it by public transport or by car.

Location “C” has a valuable advantage in comparison with the previous sites that reside in a larger size. Hence, one will be able to build a full assortment food store with a spacious and comfortable parking lot. Furthermore, this site is located in the housing sector that is currently deprived of any store facilities within the neighborhood. The nearest food store is situated three miles away, except for the small local shops that offer a narrow range of products. One might, consequently, assume that the major part of the store’s clientele will be comprised of the local residents. In the meantime, it is hard to predict whether the customer flow will be intensive enough to guarantee substantial sales on a regular basis.

The only disadvantage that the relevant site has is its remoteness from any transport links. Potential customers will have to reach the store by cars or on foot as long as there is no possibility to get there by public transport. However, taking into account the fact that the majority of locals prefer cars to public transport, one might suggest that the relevant disadvantage is not critical.

As a result, one might conclude that the most favorable sites for allocating the food store are Site “A” and Site “B”.

Works Cited

Charleston Illinois 2016. Web.

Charleston Township 2016. Web.

“EIU President Seeking Community Input Regarding Energy Center Design ” 2009. Web.

“Lincoln Avenue, Charleston IL” 2005. Web.

Moore, Christopher, Margaret Bruce and Grete Birtwistle. International Retail Marketing, New York, New York: Routledge, 2007. Print.

Spotts, Harlan. Revolution in Marketing: Market Driving Changes, San Antonio, Texas: Springer, 2014. Print.

Appendices