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2.3 Retail Market Analysis <br />Ellensburg is a retail center serving the prirnary and secondary markets defined above. This <br />section examines the Ellensbutg Matket to identify potential opporlunities for new or expanded <br />stores by examining "retail leakage." This will allorv the community to assess what kind of <br />additional stores would be attracted lo Ellensburg and will help individual existing businesscs <br />understand how they can diversify product lines to caplure this leakage. <br />2.3.1 Retail Leakage in the Trade Areas <br />Retail leakage refers to the difference between 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 />ploducts src ttot availablc within that area, corlsullers wrll ttavel to othcr plauus or use diflerent <br />meihods to obtain those products. Consequently. the riollars spent nnfsirlc nf the Rrea arri saici to <br />be "leaking." If a community is a major retail center with a variety of stores it wiil be <br />"attracting" rather than "leaking" retail sales. Even large communities may see lealcage in <br />ceftain retail categories while some small communities may be attractors in categories. <br />Ellensburg is a strong "attracting" community in rnany retail categories and is "leaking" sales in <br />other categories. <br />Such an anaiysis is not an exact science. In some cases large outflow may indicate that moncy is <br />being spent elsewhere (drug store purchases at a Target or apparel purcliases through the <br />internet). It is irnportant 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 />cxpenditures. The best example for Eliensburg is gasoline. Ellensburg can capture somc 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 accllrately 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 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 />;.;k"' i;""a ; ;il s.G;#- ffi il ; ;. &;il.# "'"" fffi;i ;;;'d#;;;. -; <br />successf,tl 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 prirnary trade area is <br />leaking $21.5 rnillion in sales annually. <br />Ellensburg is unique, however, 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 EastlWest lnterstate and a North,/South Interstate. The result is that <br />t3