Market Potential Analysis and Branch Network Planning: Application in a German Retail Bank

Location problems are an integral part of strategic planning in many kinds of industries. Optimizing an organization´s branch network requires considering multiple criteria such as location characteristics, branch performance, and competitors´ locations. There is a need for concepts that support decision makers in solving these complex location problems. This paper presents a process for market potential analysis and branch network planning in retail banking. The process meets industry-specific challenges, allows considering multiple criteria for decision analysis, and incorporates aspects, which are currently neglected in the literature. We implement this process within a decision support system and apply the process to the branch network of a German retail bank.