RIGHT FIT pt. 3 -- Consultant sees opportunities for Spencer

(Photo by Russ Mitchell) Buxton, a consulting firm, in Fort Worth, Texas, was commissioned by the city of Spencer to analyze the spending habits of the region. Local leaders hope the information will bring a fresh batch of retailers to town. [Order this photo]

Residents of Spencer, you've been profiled.

Companies see you as "Simple Pleasures." Many of you over 65 years old. You likely live in lower-middle-class neighborhoods. You are high-school educated and held blue-collar jobs before retirement. You served in the military and belong to veterans clubs.

The "Young & Rustics" are another prominent group in town. They include young, restless singles who work service industry jobs and live in modest apartments. They still try to fashion fast-paced lifestyles on sports, cars and dating.

And there's "Traditional Times." You're nearing retirement and beginning to enjoy the first empty-nest years. An edition of Country Living magazine is probably on your coffee table. You plan vacations using recreational vehicles and campers.

In a nutshell, companies see Spencer as working class community with an aging population and an appreciation of the outdoors.

That's according to Buxton, a consulting firm that specializes in matching retail stores with communities where the climate is favorable for them to succeed. The company also can work on behalf of cities to identify retailers that would be a good fit for a community.

Last fall, Spencer City Council members approved a $45,000 "Customers Retail Analysis Project" by the market research firm.

"We're tapping into the very same information that retailers are using," said Chris Briggs, the director of operations for Buxton in Fort Worth, Texas. "They are industry-accepted types of data and levels of information, so what we do, here at Buxton, for our retail clients is: We maintain and purchase, at no small cost, an in-house file of every household in the United States and up to seven individuals within each household."

The research goes beyond a city's population, ages and ethnic demographics. The company focuses more on spending habits through trackable credit card purchases, magazine sales and individual store tracking. Whenever clerks make note of zip codes or phone number area codes, they're probably gathering information for their company or a research firm like Buxton.

"What we do for retailers is provide for them an understanding of who their customers are and what the value of those customers is and how to market to those customers," Briggs said. "Specifically on the real estate side, we build forecasting models for them."

The firm works with more than 1,000 retail clients. Buxton can help with kiosk locations or tell FedEx where to put its next drop box. It also has more than 400 public sector clients.

So, what kinds of retailers are a fit for our Simple Pleasures or Young & Rustics?

"For the retail side in the region, what we see and what we report are opportunities in home furnishings, in appliances and in electronics, in health and personal care stores, clothing stores, even sporting goods and in the food service categories as well," Briggs said.

The areas that are more competitive and less appealing to real estate decision-makers are: auto parts, certain building supply outlets and general merchandise sales. The products found at Wal-Mart may lack the leakage margin to make Spencer a home run for prospective retailers.

Briggs said Spencer has established a level of credibility on the retail side that warrants stepping up to a next level. He cites the presence of Wal-Mart and Walgreens as examples.

"To say they're there already only helps to get you to that next level, and to build on top of that, because, clearly there have been some retailers who have made the decision to be in your market already," he said.

Spencer is already capturing a lot of daily needs in the primary trade area. Buxton identified a diamond-shaped territory, with points near Hartley, Sioux Rapids, Ruthven and the Iowa Great Lakes.

Opportunities exist when Buxton adds information from the secondary area. For Spencer, that larger "diamond" territory extends to beyond Storm Lake and Sheldon. Algona and the Lakefield, Minn., areas are the far points to the east and north.

"Most often, that's where a significant portion of the attention needs to be because that's where you can capitalize on a lot of opportunities," Briggs said. "I think that's one of the things we see in this case. There is a nice base of consumers in both the primary and secondary markets and that, really, there's an opportunity to tap into."

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ABOUT THE SERIES

A handful of high-profile retail properties are unoccupied and a group of Spencer citizens are looking for ways to change that. The Spencer Retail Task Force includes 15-20 contributors who hope to bring new stores to town. The series concludes with a look at a consulting firm that can identify good retail candidates for the city.