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2.3 Retail Market Analysis <br />Ellensburg is a reiaii ceriier serviug the primary and seconciary markeis defineri above. This <br />section examines the Ellensburg ivfarket to ideniify potential opporluniiies for new or expandcd <br />stores by examining "retail leakage." This will ailor,v the community to assess r,vhat kind of <br />additional stores would be attracted to Ellensburg and will help individual existing bnsinesscs <br />understand how they can diversify product lines to caplure this leakage. <br />2.3.1 Retail Lealcage in the Trade Areas <br />Retail leakage referc to the difference befween the retail expendihrres by residents living in a <br />particular area and the retail sales produced by the stores located in the same area. If desired <br />ptoducts are not available within that area, consumers will travel to other places or use different <br />methocl,s ic obtain thcsc prcducts. Ccnsequently, the dollars speni oiitside of the area ai-e saiil io <br />be "leaking." If a community is a major retail center with a variety of stores it wiil be <br />"attracting" rathet than "leakir1g" retail sales. ll.vcrr large comm.unities rnay see leakage in <br />ceftain retail categories while some smali communities may be attractors in categories. <br />Ellensburg is a strong "attracting" community in many retail categories and is "leaking" sales in <br />n+La* no+--n.i^cv (alwr vsrwE;ur rvo. <br />Such an analysis is not an exact science. In some cases large outflow may indicate that moncy is <br />being spent elser,vhere (drug store purchases at a Tatgel or apparel purchases through the <br />interrrei). it is irnportant io noie ihat ihis anaiysis accounts best for retaii categories where <br />households (rather than businesses) are essentially the only consumer groups. For example, <br />inmberyards may have brisiness-to-business sales that are unaccounted for in consumer <br />expenditurea. The beet example for Ellensburg io gasolino. Ellonsburg can capture somc of thc <br />inflow of dollars from gasoline stations, but it is unlikely that truckers are going to be the <br />poterrtial ei;,stoaers who wor-ild go downiown io eai and shop. Stores such as jeweiry shops and <br />ciothing stores are rnore accurately analyzed using retail leakage. <br />The leakage shrdy for Ellensburg is a "snapshot" in time. Consequently, there are factors that <br />point to this being a more conseruative iook at retaii potential depending on what factors are <br />examined. For example, population grorvth means that there will be rnore customers in the <br />future resulting in greater demand for retail. <br />market demand of the geographies defined as the primary trade area identified for Eilensburg. A <br />successftil store model can capture from well beyond the defined primary trade geography and <br />foster a sirong visitor market, which is evidenced in the figures i"i 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 alea selected store sales equaled $520.3 million <br />in 2015. Consumers in the same area spent $54i.9 million. Thciefore, ihe primary trade area is <br />leaking $21.5 million in saies annually. <br />Ellensburg is unique, howevor, in its location along Interstate 90. The city sewes 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 EastAVest Interstate and a North/South Interstate. The result is that <br />IJ