The Physics of Retail – What’s Your Q Factor?


This paper looks interesting. Small businesses can now figure out the best place to locate based on "Q". From the press release:

Choosing the right location is one of the most important and difficult decisions a business owner must make. You could rely on pavement-pounding research, intuition, and a good real estate agent, or you could turn to a new model that analyzes businesses in much the same way that physicists model interactions between spinning atoms.

Pablo Jensen of the Ecole Normal Superiure in France studied the locations of businesses in Lyon to determine which stores seem to attract each other and which stores repel each other (much as atoms can attract or repel each other in various materials). The analysis leads to a quality index Q that automatically reveals promising store locations throughout the city. Q might be high for a jewelery store in a particular location if there are other accessory stores nearby selling shoes or hats, but few neighboring grocery or hardware stores.

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  • Hmm, that does sound like an interesting paper. Is it really possible to come up with a formula to determine the best retail location? I’ll have to read more about the Q index and how they calculate it. Thanks for the tip about the paper!