Downtown Toolbox

Using the Toolbox


For the last sixty-plus years, small cities (population of less than 75,000) all across our country have seen continued economic leakage from downtown to outlying edge locations. Once the center for community and economic activity, downtowns have suffered the loss of retail and other businesses. Downtowns continue to suffer economic hardship brought on by fierce retail competition from category killers, large discount stores, regional shopping centers, warehouse clubs, and online shopping. Many small city downtowns face high vacancy rates and a poor mix of tenants.

Market studies are typically conducted in downtown districts for a number of reasons. Examples include:

  • To help businesses understand their trade area to improve their capture of sales;
  • To explore new business development opportunities; and
  • To demonstrate the economic importance of downtown.

This market analysis toolbox is designed to help local business leaders, entrepreneurs, developers, and economic development professionals across the country understand the changing marketplace and identify business and real estate development opportunities that are realistic and make sense for their communities. It will introduce and guide the user through many of the techniques used in analyzing specific development opportunities for a downtown area. The toolbox is intended to be a self-help resource that can be used in a locally initiated market analysis.

However, downtown market analysis today should differ from retail and shopping center market analysis. Instead of focusing strictly on retail, new emphasis is placed on the particular strength of downtown, its assets, history, and quirkiness. Traditional retail is part of the equation, but only part of it. Some of the new additions to this toolbox build on factors that are unique to downtown – things that tell a compelling story about the advantages of doing business downtown. Accordingly, Downtown has Central social district. It has become increasingly important as it contributes to the reasons why people are downtown.

The 2022 update of the Downtown and Business District Market Analysis toolbox is a result of a collaborative effort involving the University of Wisconsin-Madison, Division of Extension, the University of Minnesota Extension, and soon other states. The revised toolbox (building from the original University of Wisconsin-Extension toolbox) incorporates new tools developed in the partnering states. The update was supported with funding from the North Central Regional Center for Rural Development. The toolbox is based on and supportive of the economic restructuring principles of the National Trust Main Street Center. The Wisconsin Main Street Program has been an instrumental partner with Extension since 2000 in the development of this toolbox.

Market Analysis Process

The market analysis process presented in this workbook compartmentalizes the work so that a community can focus on the sectors most applicable to their needs.  Each section of this toolbox is designed to provide the community with analytical techniques that can be put to work immediately in economic revitalization efforts. The process requires input from local residents so that the recommendations reflect both market conditions as well as the preferences of the community. The toolbox’s sections are divided into three major parts as follows:

Part I: Understanding the Market

This part provides a series of tools necessary to develop a broad and basic overview of the competitive environment. It provides the necessary foundation to provide a more in-depth analysis of different business and real estate sectors. Tools include:

  • Trade Area Analysis
  • Demographics & Lifestyle Analysis
  • Local & Regional Economic Analysis
  • Business Owners Survey
  • Consumer Survey
  • Focus Groups
  • Peer City Comparison

Part II: Analysis of Opportunities by Sector

This part goes beyond typical market studies by providing tools to analyze specific business and real estate development opportunities raised in Part I. The purpose of this section is to provide the user with advanced tools that can be used as part of a market analysis or on an as-needed basis. Tools include methods for analyzing opportunities in:

  • Retail & Service Businesses
  • Restaurants
  • Arts & Entertainment
  • Housing
  • Office Space
  • Lodging

Part III: Putting Your Research to Work

This part helps the user develop conclusions and recommendations that are realistic in today’s marketplace. The intent is to look “outside of the box” to identify realistic solutions that could revitalize downtown. Tools include ways to apply market analysis data in:

  • Niche Development
  • Space Usage
  • Image, Branding, Marketing
  • Business Retention/Expansion
  • Entrepreneurship
  • Business Recruitment
  • Benchmarking

This market analysis toolbox and its compartmentalized tools take advantage of the wealth of market data and technology available today to extend our understanding of market opportunities. Both readily available public and private data (secondary data) and information collected locally through surveys and other research (primary data) are combined to fuel the market analysis with only the most relevant information. The use of various database software products, including geographic information systems, greatly enhances the analysis and provide new insight.

About the Toolbox and this Section

The 2022 update of the toolbox marks over two decades of change in our small city downtowns. It is designed to be a resource to help communities work with their Extension educator, consultant, or on their own to collect data, evaluate opportunities, and develop strategies to become a stronger economic and social center. It is a teaching tool to help build local capacity to make more informed decisions.

This free online resource has been developed and updated by over 100 university educators and graduate students from the University of Wisconsin – Madison, Division of Extension, the University of Minnesota Extension, the Ohio State University Extension, and Michigan State University – Extension. Other downtown and community development professionals have also contributed to its content.

The toolbox is aligned with the principles of the National Main Street Center. The Wisconsin Main Street Program was a key partner in the development of the initial release of the toolbox. One of the purposes of the toolbox has been to expand the examination of downtowns by involving university educators and researchers from a broad variety of perspectives.

The current contributors to each section are identified by name and email at the beginning of each section. For more information or to discuss a particular topic, contact us.

Explore Other Sections of the Toolbox

A Community Education Approach

While hiring a consultant to complete a market analysis might be appropriate for some communities, the approach of this toolbox is based on the premise that business and community leaders will benefit by being actively involved in the research process. Because there are technical components to the toolbox (obtaining data and using geographic information systems […]

Developing a Survey Questionnaire

Developing a questionnaire includes two things: the individual questions within the questionnaire and the questionnaire itself. We will start with writing individual questions. Writing Good Questions At the most basic level, we have two types of questions: open-ended and closed-ended questions. Open-ended questions allow for qualitative feedback from survey respondents and do not have fixed […]

Types of Consumer Surveys

There are four basic ways to survey consumers: mail surveys, telephone surveys, web-based surveys, and intercept (or face-to-face) surveys. Mail Surveys Mail surveys (questionnaires) involve printing and distributing questions to consumers via mail. Use a mail survey if you want to collect comprehensive consumer information. You must keep mail surveys short, or if you need […]

Consumer Survey

A market analysis should include local survey research to fully understand the uniqueness of your particular market and its consumers. Consumer surveys can provide information on when, where, why, how, and for what people shop, dine, live, work, and recreate. They can reveal attitudes toward your downtown and how those attitudes affect shopping and dining […]

Example Map of Tourists Clustered into Trade Areas Based on their Concentration
Trade Area Analysis

Defining a downtown or business district’s trade area is an important first step in any market analysis. This step is crucial because it defines the boundaries that will serve as the basis for further study. It also helps individual businesses identify opportunities to expand their own trade area.

Benchmarking Categories

Statistical data assembled in your market analysis can be used to establish goals and measure progress (benchmarking) related to the downtown economy. The data can be used to create a statistical snapshot or profile to help inform prospective business operators and investors about the market as well as demonstrate downtown’s importance in the community. This […]

Evaluating Lodging Opportunities

This section explores market opportunities for new lodging accommodations in the downtown area. It will help you understand travel and visitation trends, existing competition, traveler market segments in the area, and projected room night demand. This section will help you project the occupancy and average room rate, key variables in determining the viability of a […]

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