Winter 2012
What are the three most important criteria to consider before launching a specialty leasing business?


Rob Rasmussen, Regional Manager Specialty Retail at CBL & Associates Properties, Inc.


Rob Rasmussen, Regional Manager Specialty Retail at CBL & Associates Properties, Inc.
cblproperties.com

1. Thoroughly research product and market. Select the right merchandise mix based on market demographics and existing competition.

2. Keep it simple and sharp. The “less is more” approach will typically hold true, especially if launching on an RMU. The visuals and signage also need to be simple and fresh. The merchandise must immediately “pop” and capture the attention of every shopper.

3. Render exceptional customer service. Remember that customer service is part of what’s being displayed and sold, and customer-friendly signage and team members are essential, in addition to positive attitudes and smiles.


Anne Militante, Principal at Specialty Real Estate LLC


Anne Militante, Principal at Specialty Real Estate LLC
specialtyrealestatellc.com

1. When opening a specialty leasing business, first and foremost a retailer needs to make sure the product is relevant to the consumer. If the product isn’t going to be of value to a shopper, then it is unlikely the retailer will ever see significant sales success regardless of how it is priced. Retailers can avoid disinterested consumers by researching concepts and products thoroughly in advance.

2. Second, the retailer should compensate staff with frequent incentives that are, in addition to hourly pay, based on contributions to the profitability of the business. Staff incentives should be part of a retail business plan from the beginning and paid routinely on a short term and predictable timeline as a regular function of business operations.

3. Last, but equally as important as the above two criteria, is location. Retailer location needs to fit the needs of the consumer and product. Not every product belongs on the 50-yard line of Main and Main, but the right or wrong location can make or break a retail store. New retailers: Consider several location options and even test them via shorter, temporary deals, before committing to anything long-term. This allows the opportunity to avoid paying high rents often associated with “preferred” locations.

Barbara Lawson, Retailer at Barbara’s Delight


Barbara Lawson, Retailer at Barbara’s Delight

1. Location, Location, Location. Ensure that the product you are selling is one that the demographics in your desired location can/will support. No matter how great a product is, if it doesn’t appeal to customers’ taste and budget, it won’t be a successful venture. If you’re already in knee-deep, think creatively about how to market your product from a different angle to encourage sales.

2. Create a beautiful display that encourages the customer to take another look and inquire about your products. The little details really do matter so put in the extra effort to make displays as attractive as possible. You have a short window of time to capture your customers’ attention. Make it count!

3. Maintain a positive perspective—smile! It is important to focus on the brighter side of life when times are tough. Learn what you can from the experience and reassess your situation as you go along. When times are lean, choose to focus on other definitions of success—such as family, health, and future plans.

Patricia Zafferesse, Director of Specialty Leasing at Vornado


Patricia Zafferesse, Director of Specialty Leasing at Vornado
vno.com

1. Is the product a trend or a seasonal item? If the product is a trend, evaluate the time frame [over which you think it will peak] and your competition and determine how these will affect sales.

2. Will the type of product sell to the mall clientele and demographics? All products do not work in every mall, so evaluate the center’s [demographics and figure out] what percentage is represented in your sales projections. The location is also part of the success so make sure you’re in the right area in the center where customer [traffic flow is best].

3. What is the profit margin and is it enough for daily business operations? For each sale, there is an expense to cover. Determining the sale cost of the product in comparison to your purchase cost is paramount to be successful. [Although it might sound obvious], your profit margin must be greater than the expenses to operate the business. Rent, payroll if applicable, insurance and any other operating costs must be budgeted for.

Jennifer Thomas, Director of Specialty Retail at Morguard Investments Limited


Jennifer Thomas, Director of Specialty Retail at Morguard Investments Limited
morguard.com

1. Know your product. It is imperative that you are well educated about the product you are looking to sell. Lack of knowledge shows that you are unprepared and not serious about a retail commitment. You should never ask a landlord “what product do you want me to sell?” if you want to be taken seriously.

2. Have a well written business plan. This is an essential document that summarizes your vision for the business and acts as a blueprint for your operating success. It is a clear plan that illustrates that you are well organized and have thought through all aspects of your business. Without this valuable tool, a landlord will not be able to determine if you are a good fit for their shopping center or not.

3. Work with a visual merchandiser. Don’t assume just because you have a great product, that you can slap it on some shelves and expect it to sell. Visual presentation is an essential element of your retail success. Common area tenants have only seconds to capture the interest of customers as they walk by. A visual merchandiser will work with you to achieve a creative and carefully planned display that properly utilizes space and makes a clear statement about the products being sold.

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