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04. Level 1 & 2 Analysis: Quantitative Market Research The main conclusions derived from the quantitative and qualitative research are summarized below. KEY FINDING #1 (Level 1 Analysis) Downtown Santa Ana already has evident locational advantages and retail specialization in the Wellness Goods and Services category. Sales of all types of merchandise and food services in the core downtown (0.5 mile radius of N. Main and 4th) are approximately $117 million more per annum than the demand from downtown households. Wellness Goods and Food Services account for $67 million or 57% of the total downtown sales surplus. In other words, Wellness Goods and Food Services are already an established competitive advantage for downtown Santa Ana, offering potential for further development. The question is: for whom (i.e., which consumer segments) will this development be focused? A sales surplus means that retailers in these merchandise and services categories are selling more than the total annual expenditures in these categories by households residing within the downtown area. Additional purchases are being made in the downtown by households located outside of the downtown area, creating the sales `surplus.' As with the downtown area, the central Santa Ana (2.0 mile radius) retail market area also generates a sales surplus. Households in and outside of central Santa Ana are together purchasing more in central Santa Ana than the total annual resident demand for Wellness Goods and Food Services in the central Santa Ana market area. Details on the estimated sales surplus (or gap) by type Wellness Goods and Food Services are presented in Table 3. Across all retail merchandise categories, in the core (0.5 mile radius) downtown of Santa Ana, groceries, meals, and health and personal care products are the three largest areas of current sales surplus. Therefore, these are downtown Santa Ana's current areas of retail specialization. The downtown sales surplus in Wellness Goods and Food Services contrasts with downtown sales gaps or deficits in other merchandise categories. Sales of beer /wine /liquor, specialty foods, childrens' wear, small appliances, sewing goods, curtains and blinds, toys and hobby goods, lawn and garden supplies, and vehicles are below the levels of demand of resident households located in the downtown. Some of these gap areas —such as specialty foods, and toys and hobby goods —may merit further development in light of their inclusion in the Wellness Goods and Services category and of the quantified local demand. Adding further nuance to the above findings, a study by Social Compact (2006) of downtown and central Santa Ana concluded that local residents in both areas were making a substantial amount of their purchases outside of central Santa Ana. This suggests that downtown Santa Ana could further build on its existing retail market power in Wellness Goods and Food Services by better servicing local demand while also continuing to upgrade existing competitive advantages and offers for non - resident customers. The specific sales surplus /gap findings are summarized in Tables 3, 4, and 5. The Nes� Next WS-B- jai Ana Wellness District: A study of dernand and supply for wellness goods and services