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HomeMy WebLinkAbout6.n. Contract between the City of Rosemount and Buxton to Provide Retail Recruitment and Retention Solutions 4ROSEMOUNTEXECUTIVE SUMMARY CITY COUNCIL City Council Meeting: April 15, 2014 AGENDA ITEM: Contract between the City of Rosemount AGENDA SECTION: and Buxton to Provide Retail Recruitment Consent and Retention Solutions PREPARED BY: Kim Lindquist, Community Development AGENDA NO. Le - y), Director ATTACHMENTS: Proposed Contract APPROVED BY: OF RECOMMENDED ACTION: Motion to Approve the Contract between the City of Rosemount and Buxton and Authorize the Mayor to sign the Contract ISSUE The Port Authority and City Council heard a presentation from Buxton on March 4, 2014, relating to economic development marketing. Since that time,Buxton has proposed a contract for Council consideration, a copy of which is attached. This item is also going before the Port Authority prior to Council consideration for discussion. Included in the proposal's objectives are the following: recruit new retailers and restaurants;retain existing retailers and restaurants; and understand current retail and restaurant economic conditions. To accomplish these items, Buxton states they will research our community; define and evaluate the trade area;profile the trade area's residential customers; match retailers and restaurants to the market potential; and then create marketing packages for up to 20 targeted retailers. Should the Council approve the contract, the fee for services is $50,000 annually, for a three year term and includes access to retail match lists and marketing packages within 60 business days of execution of the contract. There is an add-on for $10,000 which is Visa information associated with visitors to the community. In this instance visitors means non-residents and therefore would include workers, shoppers and tourists to the community. In discussions with the Buxton representative, this is something that could be added later to the services package. Given the lower number of visitors to the community, and the additional cost, staff is not recommending the visitor information add-on at this time. To clarify, the standard package of information about the community residents is also derived from Visa data. In discussions with North St. Paul, which has just started the Buxton program, the City Administrator indicated they had an opt-out clause in their contract. The language is noted below: Opt-out Option: Client may select an opt-out option by providing Buxton with written notice within thirty (30) days prior or post the first anniversary of this Agreement. If Client selects the opt-out option, no Year 2 or 3 fees will be due and payable. Staff has indicated to our Buxton Representative that Rosemount would also like the opt-out option in our contract. The Port Authority and Council have indicated that economic development is a top priority in the community. If the services provided by Buxton are consistent with community expectations,it is anticipated that the City would maintain the contract for three years. The City acknowledges that economic development takes time, effort, and commitment that means only one year of intensive marketing will not lead to as much success as a continuous 3-year program. However, the opt-out option gives the Council a higher level of security if the services do not live up to expectations. Staff is recommending approval of the contract. Funding will come from three sources,Port Authority surplus,utility funds, and Council contingency. The exact amount of funding from each source is dependent upon whether the Council approves the VISA add-on or not. RECOMMENDATION Recommend approval of the attached contract. 2 Bu' ion' •sue= 5 } • fr.0 t sra,)' Rosemount, MN Retail Recruitment and Retention Solution Prepared by: Brittany Roark Expiration Date: April 25, 2014 :::.1.' 3 if : -i i COMPETITIVE a ,DVQNTAGE ./•"` �*i •6-34 ,n{.0 k OUR VALUE PROPOSITION Since our founding in 1994, Buxton has been a leading force in retail site and development.We are recognized for creating solutions that provide results. Buxton began as a service to help retailers make informed site selection decisions by understanding their customers and precisely determining their markets and soon realized that the company's expertise in retail site and market analysis could also be leveraged to benefit communities desiring retail expansion. More than simply providing data, Buxton supplies custom marketing materials and strategies targeting the unique site requirements of retailers, developers and commercial real estate brokers. Buxton clients achieve outstanding success using our tools for retail identification,selection and recruitment.And our clients benefit from our unique understanding of retail site selection from the retailer's point of view. • Grow Your Community. Create new, permanent jobs that will satisfy your citizen's desire to shop at home; retain dollars currently spent outside of your community and maximize revenue growth to fund city services. • Leverage Buxton's Retail Industry Expertise. Establish credibility with decision makers by providing factual evidence to support your site and gain a competitive position by leveraging our experience: o 2000+ retail, restaurant, and healthcare clients o 650+ public sector clients nationwide o 35+ million square feet of retail space o 500+cumulative years of retail management and economic development experience • Access Your Buxton Solution with Ease. Utilize your best-in-class retail recruitment solution via SCOUT, with the touch of a button from any mobile device. Get the insights and answers to your retail recruitment and site analysis questions and have the big picture in the palm of your hand. • Develop a Long-Term Partnership. You will receive personal guidance and ongoing insight into key industry topics. Page 12 Bu\ron SECTION 1: SCOPE OF SERVICES Buxton is pleased to present this proposal to Rosemount, MN. The purpose of this proposal is to outline and review your community development objectives and how Buxton's solutions will enhance your ability to effectively meet those objectives. Rosemount, MN's Objectives 1. Recruit new retailers and restaurants 2. Retain existing retailers and restaurant 3. Understand current retail and restaurant economic condition Retail Recruitment and Retention Solution:Your Community Profile Our solution is a total marketing strategy that enables community leaders to understand the consumer profile of their residents and to identify specific retailers and restaurants who seek a market with household purchasing habits just like yours. This solution provides you with the ability to actively pursue identified retailers, making a compelling case for their expansion to Rosemount, MN utilizing custom marketing packages that Buxton will create for you. You will have access to the same analytical information and insights retailers depend on today to make site selection decisions providing you with instant credibility and the ability to differentiate your community. Step 1-Research Your Community Buxton uses over 250 consumer and business databases that are updated regularly and compare your potential sites to the universe of all competing sites operating in the U.S. We define your current retail situation and those in any neighboring communities that impact your retail environment. Step 2—Define and Evaluate Your Trade Area Customers shop by convenience, measuring distance based on time, not mileage.We will conduct a custom drive-time analysis to determine your trade area using our proprietary methodology and knowledge of individual retail client's actual trade areas. Your drive-time trade area will be provided to you as a map that accurately depicts your consumer shopping patterns. Step 3—Profile Your Trade Area's Residential Customers Your community profile will analyze all the households in your drive-time trade area. Based on more than 7,500 categories of lifestyles, purchase behaviors and media reading and viewing habits (psychographics), the households in your trade area are assessed to gain an understanding of the types of retailers that would be attracted to your site. Step 4—We Match Retailers and Restaurants to Market Potential Buxton will match the consumer profile of your community's trade area against the customer profiles of 5,000+ retailers in our proprietary database. We will identify the similarity between the two profiles analyzed using Buxton's proprietary retail matching algorithm to determine if your site presents an attractive opportunity for each retailer. We then qualify the list of matched results to verify that a retailer is currently operating or expanding,that they operate in similar sites and that your site affords adequate buffer from competition and cannibalization to be realistically considered. Page 13 Bu" io l Step 5—We Create Marketing Packages Buxton will assemble individualized marketing packages for up to twenty(20)targeted retailers and will notify each retailer's key real estate decision maker, by letter that they have been qualified by Buxton as a potential viable fit for your site and should expect to be contacted by a representative of the city. Your marketing packages will be delivered to you in SCOUT and include: 1. Map of the retail site and trade area 2. Map of retailer's potential customers 3. Retailer match report that compares the site's trade area characteristics and consumer profile with the retailer's sites in similar trade areas Solution Deliverables: • SCOUT Touch Access • Drive Time Trade Area Maps • Retail Site Assessment • Retail Match List(specific retailers that match your trade area's consumer profile) • Retailer Specific Marketing Packages (for up to twenty(20) retailers) • Mobile tablet device at completion pre-loaded with all findings Access and Use Your Retail Recruitment Solution via SCOUT Buxton's Retail Recruitment solution will allow you to actively recruit retailers to your community and support existing businesses with the push of a button in SCOUT Touch, providing you with crucial information about your community,your trade areas,your residents,and much more. SCOUT is a web- based platform which is accessible on any Windows or iOS enabled device with an Internet connection and designed to give decision-makers in your community access to the data and solutions that will assist them in making better business decisions. The Retail Recruitment solution includes one(1) mobile tablet device which will be provided at completion and will be pre-loaded with all key findings. This mobile tablet device, possession of Rosemount, MN, is enabled with four(4)SCOUT Users with the ability to run demographic and trade area profile reports, and view maps, and other data elements. Identifying and quantifying the key variables which impact your community,you will acquire insights from these findings that will provide you with a strong foundation from which to understand retail recruitment and business retention efforts. In Buxton's SCOUT Touch you will be able to: • Identify Retail Matches • Run Variable Reports m • View City Limit Maps • Run Healthcare Reports • Run Demographic&Consumer Propensity Reports • See Aerial View II el • View Physician Intelligence 4111111111111=1111111 • Run Comparable Reports ANSWERS AT YOUR FINGERTIPS. ANYTIME. ANYWHERE. • Run Retail Leakage/Surplus Reports Next Page: Fees and Timing Page 14 Bu',ton SECTION 2: FEES & TIMING ANNUAL FEE SOLUTION TIMELINE • Your SCOUT access will be enabled within ten (10) business days of 50,000 the execution of this agreement (three(3)year term) • Rosemount, MN will have access to retail match lists and marketing packages within sixty(60) business days of execution. Rosemount, MN will be invoiced as follows: • $50,000 Year 1 Fee(50%of total solution fee invoiced upon execution,50%invoiced upon solution delivery) • $50,000 Year 2 Fee(Invoiced 15`Anniversary of this agreement) • $50,000 Year 3 Fee(Invoiced 2nd Anniversary of this agreement) All service fees associated with this agreement are due net ten (10) days from the date of the invoice. Buxton may include Rosemount, MN on its client list in presentations and public relations efforts. When doing so, Buxton will not reveal information that is confidential and proprietary to Rosemount, MN. Buxton Rosemount, MN Signature Signature Printed Name Printed Name Title Title Date Date Please provide us with a primary point of contact for invoice receipt. Name Phone Email Preferred Method of Receipt(Email or U.S.Maig Page 15 BU`,ton APPENDIX A: ADDITIONAL RECOMMENDED SOLUTIONS SOLUTION FEE Visitor Insights Solution vv/VISA Expenditure Data Buxton will leverage your visitor data by combining it with our household level visitor information in order to determine: • Who your best visitors are • Where more of your best visitors are found All matched records will be analyzed to define visitor segments. A comparable panel of non-visitors will also be pulled from the same geographical areas to define $10,000 non-visitor segments. Buxton will conduct a comparative analysis between visitor and non-visitor segments based on thousands of variables and will evaluate penetration rates. We then create indexes of visitor penetration rates by segment and contrast these with those of non-visitors and other visitor segments to create a comprehensive profile view of your best and worst visitor households by segment. Page 16 Btraon