Visual Crossing Blog

Optimizing store location using Visual Crossing

One powerful use of a geographic analysis tool such as Visual Crossing is to find new and better business locations. Visual Crossing not only brings several valuable tools to bear on this task, but it also makes these tools usable by any typical user of Excel, SAP, or MicroStrategy, not just hardcore GIS experts. There are three areas of analysis that this video demonstrates. Those areas are visualizing store trade and coverage areas, using external demographic data on the map, and calculating driving time areas.

Understanding coverage for existing locations

The first part of this analysis is to understand the coverage areas for the existing business locations. In most cases, a good business does not want to add new locations that overlap the coverage areas of existing location. It is usually better to reach into underserved or unserved market areas instead. So the first analysis to is to use a visualization such as Voronoi to see the coverage areas for the existing locations. Voronoi is a very sophisticated analysis technique that can calculates the expected “reach” of a location in conjunction with the other locations around it. Luckily Visual Crossing makes converting a location map into a Voronoi diagram as simple as a few mouse clicks. Visual Crossing will use the existing business data to create color-filled map territories for each location. There are many settings that can be used to adjust the Voronoi algorithm for specific business needs, but even the defaults provide a good, general purpose set of coverage areas as the starting point for our analysis.

Voronoi Location Coverage Map

Identifying candidate locations

By looking at the coverage area map, we can easily see areas that are not well covered by any existing business location. These will show as areas of the basemap that are not covered by the generated Voronoi polygons. Now that we know some potentially interesting areas for the new business location, we can introduce the next level of our analysis, external demographic data. Again, Visual Crossing makes displaying and comparing demographics data easy. You can simply click to enable any additional map layer that you choose. The source of this demographic data can come from governmental, public, or private subscription services. Regardless the source of the data, it can be easily displayed alongside the business data on the map. By using the automatically-generated legend, it is easy to determine which areas have the most value depending upon whichever demographic characteristics most influence the business.

Location Information Tool

Once you have found an area that is not covered effectively by existing business locations (using Voronoi trade areas) and is populated by customers with good characteristics for the business (using demographics data), the selection and analysis of an actual target location can begin. One of the most basic types of map analysis is to use panning and zooming to get a closer, more detailed look at a specific area of the map. In this use case, zooming into our area of interest displays additional detail on the basemap layer. When picking a business location it is often useful to understand the roads and land use patterns in the area, and a standard satellite image layer such as OpenStreetMap or Google shows this well. If we wanted to see even more detail we could employ ground-sourced images such as Google Street View in order to preview locations to research or visit.

Demographic Analysis

The drive time polygon can also be combined with an existing customer list to determine exactly which customers are likely to come to the new location. This can be used to contact to these customers or engage them in the planning process in some way. Visual Crossing can export this list for use in a separate tool such as a marketing application.

Drive Time Analysis With Customers.

Closing thoughts

As you can see, using interactive, geographic analysis to analyze both existing business locations as well as proposed new locations can greatly enhance the quality of your business understanding. More informed, targeted research can save time and money and ultimately better, more informed decisions will be made. Although the analysis described above is very powerful and requires sophisticated algorithms and data, Visual Crossing can make this simple for all users. Visual Crossing truly puts professional GIS analysis in the hands of every data consumer.