Background and Study Details:
In the spring of 2021, the University of Minnesota Extension conducted a Retail and Service Market Analysis of the Granite Falls area. The EDA sponsored this study. The purpose of this study was to provide relevant market information for business development strategies.
The Market Area Profile uses primary and secondary data about a defined trade area to provide insights into opportunities for retail and service development. Granite Falls, Clarkfield, Cottonwood, Hanley Falls, Sacred Heart, Maynard, and Wood Lake were the communities included in the trade area for this study. Many factors including Granite Falls’ close proximity to Marshall and Wilmar as large areas of potential consumers and other shopping destinations should be considered.
Data sources include resources like the U.S. Census and Minnesota Department of Revenue. A number of insights emerged through the study. Granite Fall’s location at the intersection of US 212 and MN 23 brings significant traffic to the area. Estimates, using mobile data, show that the most frequented location in Granite Falls is at that same intersection. Downtown Granite Falls is an appealing business district, but the perennial challenge is bringing shoppers to the downtown area from the primary US 212-MN 23 thoroughfare. It’s clear that there are two commercial districts in Granite Falls, splitting
between the commercial area along US HWY 212 and Downtown.
- Using a calculated retail pull factor as a way of comparing Granite Falls sales per capita and the state of Minnesota sales per capita, the study shows that Granite Falls is selling to approximately 80% of the trade area population or is losing 20% of expected sales to other areas. One area of great opportunity is in restaurant and accommodations where Granite Falls is losing 32% of expected sales.
- A retail gap analysis also determined opportunities for business development by identifying business categories where resident spending power (demand) is greater than the number of trade area businesses (supply). Categories where demand is greater than supply can be seen in the blue bars in the graph below. These are possible opportunities for business development in Granite Falls.
The research from this business gap analysis showed that some gaps in retail businesses exist and led to the following recommendations:
- Explore opportunities to expand offerings in restaurant, catering, recreational
vehicle, and entertainment categories
- Support transitioning businesses – one in five businesses plan to sell or retire in the next five years
- Increase merchant events and activities
- Increase online sales
- Market to visitors and tourists
The EDA is excited to use these recommendations to work with entrepreneurs to promote business expansion and retention in Granite Falls. You can read the full study report and see opportunities for specific businesses gaps here.