Site Location Analysis for a Board Game Café in Halifax, Nova Scotia
Retail Market Potential
Site Location
Watch out video games, a new (or old) contender in back in town. The market for board
games (not just MonopolyTM and ScrabbleTM any more) has exploded in recent years. The
technological age has created a renaissance for this classic form of entertainment and sales
have never been bigger. Amazon reported that the percentage of board game sales increased
by double digits from 2012 to 2013. In 2013 the online crowd funding service Kickstarter
reported raising $52.1 million dollars for board games ($6.8 million more than raised for video
games. The popularity of board games is still increasing and these trends are expected to
continue.
A business that is ready to capitalize on this rapidly expanding market is a board game café. A
board game café is a combination a traditional café/bistro (drinks and light snacks), a cozy
lounge area to play games and retail space for selling board games.
We would like to locate our board game café
in downtown Halifax. Halifax was selected as a
location because of its high youth population
and a low amount of competitors in this
market. Halifax has seven major universities
and colleges and is home to over 30,000 post
secondary students. The study area is
highlighted on the map to the left.
Target Market Analysis
For this site location analysis three market characteristics were examined. The target age
group for the board game café is ages 10-39. We plan to have the café open to everyone
during the day and then switch to 19+ patronage in the evening. The target population ratio
was calculated by dividing population ages 10-39 by total population. We would like to target
the store in an area with high proportions of this population group.
The café will also feature food, beverages and alcohol. To target this market we analyzed
spending on food in restaurants. This was calculate by dividing spending on food in
restaurants by total spending on food. We would like to target areas where spending on food
in restaurants is elevated.
The café will also serve alcohol and hopes to be a hot spot for board gamers who enjoy the
social aspect of going out for the night while still enjoying games with friends. To find this
market we looked for areas where spending on drinks at establishments is high. This was
calculated as the ratio of spending on alcohol in restaurants over total spending on alcohol.
We would like to target the café in an area where there is elevated spending on alcohol at
restaurants.
Competitor Analysis
Suitability Index
Weighted Suitability Index
After each of the three market characteristics were chosen
for analysis they were divided into 5 classes using the
quantile method. Each class was then weighted from 1 to 5
(with 5 being the most suitable variable). The suitability
index is a sum of the classified values for each variable. This
allows all three of the variables to be assessed at the same
time on one visualization.
The map above shows the results of the suitability analysis,
the location of competitors and the road network. The
largest cluster of high suitability is in the downtown core of
Halifax. There is also a large amount of cafes located within
this area. The peripheries of the study area and the northeast portion of the study area have the lowest suitability
index.
A weighted suitability index was also calculated for the study
area. To calculate the weighted index each of the market
categories is given a weight based on perceived importance.
Ideally a group of experts determines the weighted for each
variable using the Delphi Method. For this project I created
the weightings myself. Since the primary goal of the café is
to have people come in and play or buy board games the
target population was given the highest weighting of 0.5.
The café also plans to produce a significant portion of its
revenue from food sales so spending on food in restaurants
was given a weight of 0.3. The board game café will also be
licensed but this is not planned to be a large portion of the
revenue (perhaps an increase on Friday and Saturday nights
can be expected) so spending on alcohol in bars was given
the lowest weight of 0.2.
The map above shows the results of the weighted suitability
index. Overall the map looks very similar and very few of the
polygons have been reclassified.
Spending on Alcohol in
Bars
d
Ryan Ruthart
Total spending on alcohol in bars
divided into 5 classes based on
quantile breaks is shown on the
left. There highest cluster of
spending is in the down town area
along the water front. The out
skirts of the study area have the
lower spending on alcohol in bars.
Spending on food in
Restaurants
The ratio of spending on food in
restaurants divided into 5 classes
based on quantile breaks is shown
to the left. Generally the edges of
the study area have the lowest
amount of spending on food in
restaurants. The highest spending
occurs within the downtown core.
The north east corner of the study
area generally has a lower amount
of spending on food.
Target Population
As part of the site location analysis potential competitors were assessed. For the board game
café we decided our main competitors would be café style restaurants which provided a
relaxed atmosphere with comfortable seating. Although we do plan to sell liquor, we are not
planning to compete with the rowdy bar market.
The yellow pages were used to look up street addresses cafés in the Halifax area. A total of
100 cafes were identified one of which is a board game café (The Board Room). The addresses
were then geocoded in ArcGIS using the Geocode Addresses tool. Once geocoded the
competitors could be plotted on a map to aid in the location analysis.
Shown above is a summary table for the results of the Suitability Index. The highest amount of
competitors are within polygons to be considered primary targets. The total area of primary
polygons is low, only 11% of the study area falls within this category. When looking at the
primary markets by percent polygons the number increases to 37%. This is because the
primary polygons for locating the store are within the downtown and are much smaller than
suburban polygons.
Shown above is a summary table for the results of the Weighted Suitability Index. The highest
amount of competitors (50%) are within polygons to be considered primary targets. The total
area of primary polygons is low, only 7% of the study area falls within this category. When
looking at the primary markets by percent polygons the number increases to 27%. Compared
to the unweighted suitability index the general trends of the results are similar but each
category has different values. Using the weighted method there are less competitors in
primary regions, the primary regions make up less of the study area by area and there less
primary category polygons.
The target population divided into
5 classes based on quantile breaks
is shown on the left. The target
population is people between the
ages of 10 and 39. The largest
cluster of this population is within
the down town core of Halifax.
The north east portion of the
study area generally has
populations outside of this range.
Conclusions
A board game café is an excellent business opportunity in downtown Halifax. There is a very
large potential market and few competitors. Based on the suitability analysis the downtown
core provides the best access to the target market. Additional analysis should be conducted to
chose the specific site location.
Shown above are the top rows of the table used for this analysis. Each of the market variables is shown (target population, spending in
restaurants, spending out on alcohol). In addition each of these variables has been divided into 5 classes using the natural breaks quantile
method. The Suitability Index is also shown which is a sum of the classified values for the market variables. The weighted suitability index
was calculated as the sum of (Target Population * 0.5) + (Spending on food in restaurants * 0.3) + (Spending on alcohol in bars * 0.2).