Secret Dollars On Offer to Start Your Business
Thought you could never afford to
open your own business in a
shopping centre? …. Think again
The set up costs involved in opening a store in a shopping centre are huge, the fit out alone is
enough to put the average dreamer into cardiac arrest. 100k, 200k even more to fit out your store,
and that is before you look at stock or equipment. So you can see that most people run for the hills
because a return on investment can take years to achieve, especially with the online competition
that now faces many retail outlets.
I am not an expert in the field of retail shop fit outs even though I have owned a store in a shopping
centre, but there are some hidden incentives available for those who are game to explore the
SHOP FIT OUT CONTRIBUTIONS – Most major shopping centres will pay you money towards fitting
out your store on the provision that you sign a 5 year lease. When you make initial enquiries the fit
out contribution is often low, let’s say $30k this is the starting point of your negotiation. “Whatever
you do, do not take the first offer” especially if the shop has been vacant for quite some time.
(if you are not a good negotiator get someone to do this on your behalf) There is usually a lot of offers
and counter offers along the way.
Do your maths and work out what your fit out is actually going to cost then add another 30k on top
of that figure. You may be very surprised at what the final fit out contribution from the shopping
centre will be. In some circumstances you may be able to negotiate a contribution of $100 – 300k
depending on the nature of the business and how desperate the centre is to have you in there.
LEASES – Generally you will be made to sign a 5 year lease to open up your store and receive the fit
out contribution. Leases can be very confusing and should always be examined by a professional
before signing. Look for a couple of things in the lease. Percentage Rent, Exit Options and be aware
what happens if you close the store if your business is not performing and you close.
The fit out contributions in most circumstances do not have to be paid back even if you sell the
business within your lease period providing the new owner continues the lease for the remainder
of the lease. The big benefit of this is you can start and if a business very easily and make a generous
profit from the sale of the business and a good income from sales along the way.
In conclusion opening a store in a shopping centre can be a lot cheaper than you think but can also
be very tricky. Make sure your business plan is solid. Make sure that your product is wanted and that
there is a need for what your selling, and most importantly if you have any doubts always seek advice
from industry professionals.