Downtown Business Mix: What to Recruit (and What Not to Recruit)
When downtowns talk about improving their business mix, the conversation often starts with a wish list. More restaurants. More retail. More nightlife. More reasons to visit.
Those instincts are understandable. A strong business mix does matter. But recruitment decisions based on aspiration instead of fit often create churn rather than stability.
A healthy downtown business mix is not about chasing what looks successful elsewhere. It is about understanding what this downtown can support right now.
Why Business Mix Conversations Go Sideways
Recruitment pressure usually builds when:
vacancies feel visible
foot traffic feels uneven
comparison to other downtowns creeps in
elected officials or boards want movement
In those moments, communities often ask the wrong question. Instead of asking, “What does our downtown need next?” they ask, “What are we missing?”
That subtle shift leads to recruitment decisions driven by perception rather than performance.
What a Business Mix Actually Does
A business mix shapes how downtown functions day to day.
It influences:
when people come downtown
how long they stay
whether visits repeat
how resilient the ecosystem is
A good mix balances:
daily needs and discretionary spending
anchors and supporting businesses
predictable activity and occasional energy
No single business type can do that alone.
Start With Who Is Already There
Before recruiting anything new, look closely at what exists.
Ask:
Which businesses are stable?
Which are struggling, and why?
What gaps are operational, not just categorical?
What hours are actually being kept?
Recruitment that ignores retention often accelerates churn. Strengthening the current mix usually does more for vitality than adding something new.
What Often Makes Sense to Recruit
While every downtown is different, certain categories tend to support stability when the timing is right.
These often include:
businesses that meet daily or weekly needs
services that increase repeat visitation
complementary uses that extend hours incrementally
operators with realistic scale expectations
These businesses may not feel exciting, but they tend to compound over time.
What to Be Careful About Recruiting
Some business types are frequently over-recruited.
Common examples include:
destination restaurants without sufficient demand
niche retail dependent on heavy tourism
concepts requiring long operating hours and high staffing
businesses with margins that leave no room for error
These concepts can succeed, but only when the underlying conditions are right. Recruiting them too early often leads to short tenures and visible failure.
Why “Anchor First” Is Not Always the Answer
Anchors can help, but they are not universal solutions.
Large anchors:
require consistent demand
often draw activity inward rather than outward
can overshadow smaller businesses
may not align with local capacity
In some downtowns, a collection of smaller, stable businesses creates more resilience than a single large draw.
Timing Matters as Much as Type
The same business can be a great fit at one moment and a poor fit at another.
Recruitment works best when:
business retention is improving
hours are becoming more consistent
vacancy is stabilizing
organizational capacity can support onboarding
Recruiting before these signals appear increases risk for everyone involved.
The Role of Downtown Organizations
Downtown organizations should not act as brokers or sales agents.
Their most effective role is to:
set realistic expectations
share honest market information
discourage poor-fit recruitment
support operators after opening
Saying no is often more valuable than saying yes.
What Healthy Business Mix Conversations Sound Like
Productive conversations focus on:
who the downtown serves regularly
what gaps affect daily function
how new businesses fit with existing ones
what the ecosystem can realistically support
They avoid:
copying other downtowns
chasing trends
measuring success only by category count
Fit beats novelty.
Connecting Back to the Bigger Picture
Business mix is shaped by:
retention
walkability
storefront readiness
organizational capacity
Recruitment works when it responds to these conditions rather than trying to fix them.
The Takeaway
A healthy downtown business mix is built, not assembled.
Communities that recruit thoughtfully and resist poor-fit opportunities protect both entrepreneurs and the downtown ecosystem.
The right business at the wrong time can set progress back. The right business at the right time can change everything.
Continue the series:
Next: The Truth About Events as a Downtown Strategy
Or, if you want to see how RAD helps communities apply these ideas in real situations, you can explore how we help and our services here.