Which is better: downtown or mall?

Q. We have a small shoe store in a mid-size downtown. We're thinking about moving to an enclosed mall several miles away. Are there any studies which show how operations of mall stores compare with those of downtown stores like ours? What can we expect if we move?

A. Every situation is unique, and your fortunes will rise or fall based on the uniqueness and professionalism of your business. But we are able to refer you to a study released this past fall by the National Shoe Retailers Association. NSRA's 1997 Business Performance Report shows "the location of the store has a tremendous effect on its numbers."

On average -- and we stress the word average -- enclosed mall locations report the highest sales per square foot ($339), gross profit percentages (45.0 percent of net sales), occupancy expenses (9.7 percent), wage and salary expenses (19.5 percent) and total expenses (43.5 percent). They also have the lowest advertising expenses (2.1 percent), net profit (2.2 percent) and '97 comp-store performance (3.6 percent) numbers.

By contrast, street-front stores such as your downtown location ring up the best net profit (5.0 percent) and comp store performance (6.3 percent). While their gross margin is only 42.8 percent, lower occupancy and wage and salary expenses yield a net margin more than two times that of the average enclosed mall store.