Guides In Mall Leasing
The Mall is the ideal place to setup your franchise business. Popular malls like SM, Robinsons, Shangri-La attract
thousands of people everyday, here are some guides in mall leasing.
1. Prepare a Letter of Intent
(LOI) This document is crucial to your application as it introduces you and your franchise business to mall management. The LOI states your intention to lease space and describes your franchise business concept, including product line, pricing, packaging and marketing, cart design, power requirements, brief background on operational procedures, contact numbers, etc. Depending on how the letter is composed, this could lead to capturing the interest of mall management and being invited for an interview and product evaluation.
2. Product Testing and Interview
Once you have the mall management’s attention, they will schedule you for an interview. Here, you will be expected to demonstrate, exhibit, or let them sample your products. It would be advisable to be in your best element during this day, and to ensure the following are ready:
- 2.a) Documents: product concept, cart design, etc.
- 2.b) Products: meticulously prepared beforehand
- 2.c) Staff: well-briefed, well-groomed and in uniform
- 2.d) Operational flow: how products will be prepared and served
- 2.e) Marketing materials: how products will be presented in the mall
- 2.f) Prayers: for mall management to approve your concept
After the interview and evaluation, it generally takes two to three weeks before mall management comes up with their decision. Normally, the business owner receives an offer sheet from the mall management, indicating the rental fee, area size, actual location, security and advance deposits required, lease term including commencement and duration, other requirements and special conditions. Lessees are usually given five days to conform to the offer sheet. Make sure to clarify any points you are unsure of before signing the lease agreement. To help you make your decision about the particular space offered to you, let me offer some tips on site evaluation:
- Go to the actual site and do a body count/foot traffic on an hourly basis then add up the total number of people who pass by within three to five feet of your actual site. Multiply the total by two to five percent. The result will be the number of your probable buyers.
- Ask around and investigate how much your would-be neighbors make on a daily basis.
- Try to get the total number of foot traffic going to the mall. You may get this information from the leasing department or mall management. With this data, you can now make your own feasibility study, and help you decide whether the space will bring in enough income for your business.
4. Space Acquisition
Once you have agreed to the conditions stated in the offer sheet and have officially acquired the mall space, you are now ready to operate your business. To ensure that your business is smooth sailing in the mall, it is important to keep a good relationship with mall management, by doing the following:
- Be a good tenant. Always pay your rent on time.
- Be a good neighbor. Always make sure that you follow house rules and zoning regulations. This includes keeping your area clean and not frying in a no-cooking zone.
- Be a team player. Join and support their marketing activities such as mall wide sales, promos, etc.
- Be friendly. Call Leasing once in a while to say hello and find out if they have any concerns regarding your lease or your business. Unless you are a big tenant, do not throw your weight around like you own the mall. With the queue of prospective tenants waiting for a slot, management might just replace your business with another one if you are too much trouble.
- Be thankful. Remember, securing a space in a mall is not a benefit; it is a privilege. Maintaining a good relationship with mall management will make it easier for you or your other franchise businesses to secure mall space in their chain of malls. Word may even spread to other mall chains of your good record as a tenant.
Here are some numbers you could call up if your interested in setting up your franchise business in the malls.