Laserfiche WebLink
2.3 Retail Market Analysis <br />Ellensburg is a retail center serving the primary and secondary markets defined above.This <br />section examines the Ellensburg Market to identify potential opportunities for new or expanded <br />stores by examining "retail leakage."This will allow the community to assess what kind of <br />additional stores would be attracted to Ellensburg and will help individual existing businesses <br />understand how they can diversify product lines to capture this leakage. <br />2.3.1 Retail Leakage in the Trade Areas <br />Retail leakage refers to the difference between the retail expenditures by residents living in a <br />particular area and the retail sales produced by the stores located in the same area.If desired <br />products are not available within that area,consumers will travel to other places or use different <br />methods to obtain those products.Consequently,the dollars spent outside of the area are said to <br />be "leaking."If a community is a major retail center with a variety of stores it will be <br />"attracting"rather than "leaking"retail sales.Even large communities may see leakage in <br />certain retail categories while some small communities may be attractors in categories. <br />Ellensburg is a strong "attracting"community in many retail categories and is "leaking"sales in <br />other categories. <br />Such an analysis is not an exact science.In some cases large outflow may indicate that money is <br />being spent elsewhere (drug store purchases at a Target or apparel purchases through the <br />internet).It is important to note that this analysis accounts best for retail categories where <br />households (rather than businesses)are essentially the only consumer groups.For example, <br />lumberyards may have business-to-business sales that are unaccounted for in consumer <br />expenditures.The best example for Ellensburg is gasoline.Ellensburg can capture some of the <br />inflow of dollars from gasoline stations,but it is unlikely that truckers are going to be the <br />potential customers who would go downtown to eat and shop.Stores such as jewelry shops and <br />clothing stores are more accurately analyzed using retail leakage. <br />The leakage study for Ellensburg is a "snapshot"in time.Consequently,there are factors that <br />point to this being a more conservative look at retail potential depending on what factors are <br />examined.For example,population growth means that there will be more customers in the <br />future resulting in greater demand for retail. <br />A second factor making this study more conservative is that the leakage study only examines the <br />market demand of the geographies defined as the primary trade area identified for Ellensburg.A <br />successful store model can capture from well beyond the defined primary trade geography and <br />foster a strong visitor market,which is evidenced in the figures 1.1 and 1.2 which show over <br />10%of the customers are coming from outside of the state of Washington. <br />With these conservative factors in mind (meaning our numbers represent "minimum"potential <br />and not "maximum"potential)the primary trade area selected store sales equaled $520.3 million <br />in 2015.Consumers in the same area spent $541.9 million.Therefore,the primary trade area is <br />leaking $21.5 million in sales annually. <br />Ellensburg is unique,however,in its location along Interstate 90.The city serves as a stop <br />before and after crossing the Snoqualmie pass over the Cascade Mountain Range,and it sits at <br />the intersection of a major East/West Interstate and a North/South Interstate.The result is that <br />13