A visit to the malls is not complete without seeing the carts and kiosks. Practically they are spread in every floor and catering to various businesses. They occupy the middle aisle almost serving as an island. The design of the carts and kiosks has become so creative that almost everything is compact. Many entrepreneurs have seen the benefits of resorting into this. For one, the rental is not as exorbitant as the big store spaces or more commonly referred as in line stores.
If and when there is a need to relocate, the structure is easy to disassemble. Speaking of manpower, most of these would have a minimum number of 1 to 3 people.However there are limitations specially when it comes to food. Most mall administrators refuse to allow any tenant to have cooking done specially using the liquefied petroleum gas (lpg).
Storage facilities are limited and supplies may have to be on a daily transfer. Malls likewise have a standard height and width including the particular signage. This is to ensure that the kiosks and carts do not block each other. There is a major mall where part of the policy is not to allow employees of any kiosk and cart tenant to sit down. The storage box located behind the cart is according to the specific measurement and the top cover shaped like an apex to primarily discourage employees from sitting.
Meantime it could be recalled that a major mall was restricted by a local government unit to remove carts and kiosks along the pathway and confined to extra spaces. Accordingly the pathway should serve as a greater convenience to the customers strolling.
On the question of getting into business via a cart or kiosk, an entrepreneur would be smart to study. In most of the clients who have consulted me, I often start off with the business concept. Please note that carts or kiosks are not necessarily positioned inside the malls. There are also carts that are for outside use and some are even mobile. One will never forget seeing an ice cream cart on wheels with a sound that will make one remember. Or how about that popular hamburger joint with caricatured characters of dwarfs at work and serving aside from burgers its famous roast beef sandwich?
Thus the design must project what the business is all about. Making consumers recall or even hum the tune of the ice cream cart already makes the concept a success. The other factor is the type of products and services to be offered in the cart and kiosk. With a space limitation, there must ease and convenience of being able to deliver the product with such high quality.
A client who is into popcorn business came and approached me to say that he just couldn’t penetrate into the targeted malls. Every time he files an application, he was always turned down since his preparation involved using open flame. Thinking outside the box, he was advised to look for an outside place where he will be allowed to do cooking. From the site, freshly cooked popcorns packed are then to be delivered to the surrounding malls. Bingo! With such a scheme, his brand is now everywhere and even in gasoline stations.
The point here is for an entrepreneur never to say NO if the business is faced with restrictions. It is a matter of reflecting and thinking of the numerous possibilities to reach the goal.
There is another alternative in getting into a cart and kiosk business. This is none other than via franchising. The growth for food businesses has been on an increasing rate from a handful in the early 70’s to about 300 + franchisors. The concept runs from dimsum, rice topping, pao, ice cream, peanuts, etc. There are also non-food carts and kiosks like selling beauty products, perfume, key duplication, picture frames, etc.
What are the advantages of getting into a franchise? First and foremost is saving one from the trial and error. The franchisor is also an entrepreneur who before franchising his business had to experience numerous experiments. Such may be costly aside from the hit and miss of getting the right product and business concept combination. Another factor is the brand equity. A franchise brand is easily recalled due to the numerous branches it has. A consumer will patronize a brand as compared to an individual business. The primary reason is there is consistency in the product and service. In this connection, franchise always provides consistent support. This may be in the form of product research and development, training of personnel and franchisee as well as promotions.
The investment in a franchise carts and kiosk is affordable. The range is between Php. 150,000 to about 500,000. This includes the equipment, build out cost and franchise fee. Term of a typical franchise is about 5 years and renewable. To provide continuous support, there are service fees like a percentage of gross sales. The average nowadays is 5%, which is paid to the franchisor. As for the supplies, there are franchisors where certain items known as proprietary are bought from the franchisor.
On the pay back, which is a return of the investment, franchisees that invested on cart and kiosk average on a 1 ½ to 2 years. This means that out of 5 years, the franchisee gets his investment within that period and the rest is profit. However, one advice is for the person not to jump and secure a franchise business.
There are proper ways to get and invest on a franchise. Here are the following steps:
- What is the reason for getting a franchise business?
- Where is the money to invest be coming from?
- How much time will the person devote in the day-to-day operation?
- Has there been a search for the franchise business?
- Of the various businesses, which has a strong appeal?
- Has the person tried and tested the product and service?
- Has the person compared and checked if the product and service is consistent with the other branches?
- Where will the location of the chosen franchise business be situated?
- Is the person a residing near or within the community of the location?
- Visit the franchisor’s head office and inquire on the franchise offering?
- Get all the necessary information including the procedures in applying for a franchise.
- Discuss with family about the franchise. Seek the opinion of the members with an open mind.
- If getting into business shall involve having partners, do analyze and have written agreement.
- Meet and talk with existing franchisees of the franchise business.
- Study and consult a legal counsel before signing the franchise agreement.
- Make a financial and market study of the location.
- Personally meet the franchisor and partners aside from dealing with the employees.
- Prepare questions to ask from the franchisor and franchisees.
- Who will be involved in the training and preparation?
- Watch out for franchisors that make verbal promises and not found written in the franchise agreement.
Getting the right franchise business spells having a healthy business relationship between the franchisor and franchisee. The person is highly advised to watch out for scam franchise business. They do make claims yet on empty promises.
Lastly allow me to share what a wise man once said that when reaching a destination, it is best to be slow rather than stop or be quick.
Author: Armando Bartolome of The Manila Times