Locality

Background

Knowing where to sell the product or service is crucial when starting a business. Picking a location oversaturated by the competition, with the wrong type of customers, or insufficient numbers of the right ones, could quickly lead to failure.  

For example, fewer footballs than tennis balls will be sold at an international tennis tournament. People attending the game are likelier to be tennis fans than football fans. Therefore, the demand for tennis balls will be higher. Additionally, a shop set up closer to the event's main entrance will gain more customers, due to the significant pedestrian traffic, than one in the middle of the parking lot. However, intense competition at the main entrance may reduce profits.

It is the same for food businesses. The best locations will have the right type of customers in sufficient numbers living or working around the area and low competition. Food trucks have the additional consideration of seeking parking spots with adequate pedestrian traffic and identifying when the population is usually highest in the area. Because food trucks are mobile, they can quickly move to various places in time to catch the rush hour in that area.

Simulation  

The simulation has seven localities and 19 stand spots. The locality and spot selected both play a crucial role in how much a food stand earns on a given day. Parking in areas with sufficient foot traffic for the target customer segment is a powerful ingredient for increasing profits.  

Street Corner  

Primary Customer Segment: Parents

Secondary Customer Segment: Students

Stand Spots: 2

Permit Fee: Low

The Street Corner is one of the most common features of the urban landscape. Typically found at the intersection of two streets in a residential area, it is a high-traffic area for parents and children. Its residential designation ensures low permit fees for Stand spots in the area.  

Noisy Playground

Primary Customer Segment: Students

Secondary Customer Segment: Parents

Stand Spots: 2

Permit Fee: Low

The Noisy Playground is a safe and enjoyable space for students of all ages. It has a variety of play equipment, sports courts, and running areas, along with some shade and seating for adults. Open to the public for free, food stand permit fees are generally low to ensure the availability of snacks and refreshments.

Park Central  

Primary Customer Segment: Environmentalists

Secondary Customer Segment: Fit ones

Stand Spots: 2

Permit Fee: Moderate

Located in a densely populated area, Park Central provides a much-needed green space that helps improve air quality and the mental health of residents. Its manicured gardens, open sports facilities, and walking trails offer a soothing respite from the hustle and bustle of city life. The permit fee paid by Food Stands is typically moderate, as part of it goes to support the Park's operations.  

Big Station

Primary Customer Segment: Staff

Secondary Customer Segment: Foodies

Stand Spots: 2

Permit Fee: Moderate

Beyond serving as the heart of the city's transportation hub, Big Station is famous for its art installations and numerous vending machines. The station's wide entrance and multiple exits help minimize congestion for its daily crowd of commuters. Although the permit fee for Food Stands usually includes an additional charge for waste removal, it is still moderate.

Glamour & Hip Street

Primary Customer Segment: Influencers

Secondary Customer Segment: Foodies, Tourists

Stand Spots: 2

Permit Fee: High

Glamour and Hip Street is the city's shopping focal point. Retailers, from high-end stores and restaurants to more budget-friendly shops, envelop the bustling junction. This multitude of businesses attracts Influencers and other residents seeking after-hours entertainment services. Products and services are more expensive here than in other parts of town, hence the high permit fee for Stand spots.

National Landmark  

Primary Customer Segment: Tourists

Secondary Customer Segment: Fit ones

Stand Spots: 2

Permit Fee: High

Officially designated as a site of national significance, the National Landmark is an expansive area of natural beauty. Guided tours and hiking trails offer a chance to learn about its history and connect with nature. Although thousands of sight-seers visit the landmark weekly, the government ensures its preservation by minimizing human impact. All forms of development are prohibited. High food stand permit fees serve as a barrier to entry for lower-quality businesses.

Financial Hub

Primary Customer Segment: Managers

Secondary Customer Segment: Staff, Foodies

Stand Spots: 2

Permit Fee: High

The Financial Hub is home to the corporations, banks, and exchanges that fuel the city's growth and make a few dwellers stupendously rich. The city's financial hotbed is full of professionals constantly pushing to close the next deal. Driven by an intense quest for quality and status, folks in the Financial Hub always demand the best. And this is evident in the high permit fees for food stands.

Tips for choosing a suitable locality

It is always better to take a strategic approach when choosing a locality than adopting a trial-and-error process. The key factors to consider when selecting any locality are as follows:

1. Permit Fee: Paying expensive permit fees at the onset of the business will increase operational costs and dig into any profit margins. Starting at localities with low permit fees can help keep costs low and give the business room to grow.
2. Primary Customer Segment: Understanding the needs of the primary customer segment in a locality is essential. Picking a locality dominated by a customer segment the business cannot satisfy will, at best, require additional investments in upgrading the recipe or the food stand. Worse, it could lead to customer dissatisfaction and heavy losses.
3. Population Size: The more people in a locality, the more potential customers the food stand has. But localities with higher population densities often charge expensive permit fees. At the onset, it is usually best to seek out localities with affordable permit fees and optimize sales by selecting a Stand spot with high foot traffic.

   Identifying high foot-traffic spots: A wonderful way to optimize locality sales is by understanding foot traffic around each Stand spot. Choosing a Stand spot with high foot traffic in a locality with low to moderate population density can make the difference between failure and success. The best way to identify the high foot-traffic spots in a locality is to rotate spots and record the average daily sales over a couple of days at each one. To ensure accurate results, record only days when pricing, recipe, weather, and external events were the same.

4. Competition: Intense competition in a locality can limit profits. The best time to venture into a locality with competitors is when the business is sure of its competitive advantage. This competitive advantage can be the ability to secure the highest foot-traffic spot in the locality or superior resources and reputation. However, a business can quickly lose a valuable Stand spot to the competition if its Stand moves to another locality to take advantage of a fleeting opportunity.