Sunday, November 11, 2012

Livermore Outlet Mall Analysis - Competing with Vacaville and Gilroy Outlets

So a new outlet mall just opened up in Livermore (Paragon Outlets).  I don't know everything about retail shopping and brands, but it seems pretty damn nice.  It's headlined by the Saks, Bloomingdales, and Neiman Marcus department outlets.  There are also outlet stores for premium brands like Prada, Aramani, Burberry, Barneys, Kate Spade, Coach, and others (which to be very honest, I had never heard of the brand Kate Spade and did not know about its popularity until I saw a line of 20 women lined up outside of their store at 10pm).  There are many "middle tier" stores that I shop at like Gap, Banana Republic, Jcrew, Lacoste.

Anyways, I ran upon this article about the affect the new outlet mall would have on Gilroy and their revenues.  There was the following quote:
"“I think they are far enough away that there isn’t a lot of angst here that they will create competition,” said Susan Valenta, Gilroy's Chamber of Commerce CEO.  "
This quote got me thinking, is it really true?  I know that there are people out there that do the following analysis for a living, but I'm going to play business analyst and see what I can come up with.

As far as I can tell, there are two other major outlet malls in the bay area that are at the same level of Livermore's, one in Vacaville and one in Gilroy (although many believe Livermore has more/better stores/brands, but we're going to ignore that).  There's one in Napa, but its much smaller than the others so I'm not going to count it.  (Update: Someone reminded me that the Great Mall in Milpitas is sort of like an outlet mall.  But I'm not going to count that either, it's really a half outlet mall and half normal mall.)

Using Google Maps, the following are travel distance times from a number of Bay Area locales to these outlet malls.  Presently, the new Livermore Outlet Mall is not on Google Maps, so I will use the Target across the highway as my destination point (Livermore's outlet mall is the south exit off the highway, Target is the north exit at the same spot.  I also forced Google Maps to reroute the Target directions to use the same exit instead of a 1 minute faster local road.).

City To Livermore To Gilroy To Vacaville Closer to Livermore than Gilroy Closer to Livermore than Vacaville
San Francisco 49 mins 86 mins 66 mins 37 mins 17 mins
San Mateo 43 mins 65 mins 85 mins 22 mins 42 mins
Foster City 40 mins 64 mins 84 mins 24 mins 44 mins
Redwood City 49 mins 60 mins 93 mins 11 mins 44 mins
Palo Alto 51 mins 52 mins 96 mins 1 mins 44 mins
Mountain View 45 mins 46 mins 99 mins 1 mins 49 mins
Cupertino 49 mins 42 mins 103 mins -7 mins 54 mins
San Jose 42 mins 35 mins 97 mins -7 mins 55 mins
Milpitas 36 mins 44 mins 90 mins 8 mins 54 mins
Fremont 31 mins 52 mins 82 mins 21 mins 51 mins
Castro Valley 20 mins 68 mins 68 mins 48 mins 48 mins
Oakland 37 mins 80 mins 56 mins 43 mins 24 mins
Walnut Creek 28 mins 82 mins 46 mins 54 mins 18 mins
Concord 34 mins 87 mins 44 mins 53 mins 10 mins
Pittsburg 44 mins 98 mins 51 mins 54 mins 7 mins

So what do I get from this chart?

Not surprisingly, anything in the East Bay is now significantly closer to a major outlet mall.  Many East Bay communities that were closer to the Vacaville outlet than Gilroy's will find themselves closer to Livermore's outlet now, even the Northeast cities like Concord and Pittsburgh will still find themselves closer to Livermore than Vacaville.

As you move South, towards Fremont & Milpitas, the Gilroy Outlet was significantly closer than the Vacaville one, presumably getting all the business from this area.  The Livermore one is now significantly closer for many of these areas and you would expect could take away those shoppers.

If you live in the South Bay closer to the San Jose area, this is where the Gilroy Outlet finally becomes closer than the Livermore one.  However, it's not significant.  For both San Jose and Cupertino, the time travel savings is only 7 minutes.

As you move north on the peninsula, Gilroy gets further away and Livermore gets closer thanks to major highways/bridges (most notably 92).  It's basically a wash once you get up to just the Mountain View and/or Palo Alto area.  Once you get into the Foster City and further North area, Livermore's outlet mall is over 20 minutes closer.

So it appears that for pretty much most of the bay area, Livermore's new outlet mall ranges from a "bit closer" to "much closer" than the Gilroy or Vacaville outlet malls.  Even in the areas where the Gilroy or Vacaville outlets are closer, it's not enough of a time difference to make up for any major brands and/or stores shoppers really want to aim for.

Conclusion? Gilroy & Vacaville should be concerned of increased competition if they are only thinking of distance to location.


  1. Hey there! Thanks for sharing this article, it has been a very interesting read. I've personally never had the really deal much with outlet malls in San Diego. I'll be going on vacation there with a few friends next week and we're looking for some places to check out and shop at. I have my hopes up for this palace.

  2. Did you use the collection of Google Maps APIs to calculate travel distance?