Introduction to Site Selection

Site Selection describes a business practice where a company selects a location for a new facility. Typically, site selection refers to the entire process of determining the location of a new facility, including:

  • Recognizing the need for a new facility
  • Creating specific objectives or task for the new facility
  • Determining what requirements the new facility must meet to achieve its objectives
  • Creating a preliminary list of possible sites (locations) for the new facility
  • Using a well-defined process for analyzing the prospective sites and eliminating incompatible locations
  • Working with architects and engineers to obtain advanced analysis of each potential site.
  • Selecting the 'winning' site, which will be the location for the new facility

Below is an excerpt from Business Site Selection, Location Analysis and GIS by Richard L. Church, which introduces the basics of Site Selection.

In business, there is an old question that goes something like, "What are the three most important factors in retail?" The answer is, "Location, location, location!" Although there are many factors that contribute to the success of a retail venture, location is undeniably one of the dominant considerations. Retailers also want to know about their customers-where they come from, how often they shop, what they buy, how much they spend, and so on. The more they know about and understand their customer's preferences, the better they can select and market their goods. This can also help them make good store location decisions. A good location can help to ensure success and a poor location usually dooms a store to failure. In fact, a primary need in retail location is the capability to estimate in advance the functional market area of a potential outlet before committing to a lease, investing in site improvements, or actually building a new facility.

In this chapter, we describe how to estimate the market area or trade area of a business. We also describe how service areas can be determined for the supply and distribution of product from manufacturers/distributors to retail sites. Modeling trade and service areas is an important task in making location decisions and is key to the success of any business. The GIScience section discusses the modifiable areal unit problem (MAUP), highlighting its implications for trade and service area delineation, and location analysis more broadly. As advanced topics in this chapter we review specification issues associated with the spatial interaction model, a variation of the transportation problem, and the use of trade and service area models in supporting site selection decision making.


From Business Site Selection, Location Analysis and GIS by Richard L. Church. Copyright 2009 John Wiley & Sons, Inc. All Rights Reserved. Used by arrangement with John Wiley & Sons, Inc.