Demand for spaces in malls rises
A young entrepreneur, who wants to start up a business inside Ikeja City Mall in Lagos, or any of the malls, may find raising the start-up money difficult. This is because, at the moment, it is only big retailers that can become tenants in the malls. They can afford the high rent and meet management requirements.
Whether or not a small retailer can get a space in a mall depends on the market, management and rent, among other factors.
Findings have shown that the number of merchants who desire to become tenants in malls, especially the pioneer ones, is increasing by the day. The first set of malls are: The Palms in Lekki, Lagos, which came into the country in December 2005; Ikeja City Mall opened December 2011, Kwara Mall in Ilorin opened November 2012, Polo Park in Enugu opened September 2011 and Grand Towers Abuja berthed in 2000.
The Palms always has a long queue of retailers who want to own shops there, same with the Ikeja City Mall and the Adeniran Ogunsanya Shopping Mall in Surulere.
The Chief Executive Officer, Broll Nigeria, Mrs Erejuwa Gbadebo, said: “If the major barrier to entry is removed and rent is made affordable to every merchant, then the demand to become tenants in a mall like The Palms or Ikeja City Mall for instance, could be met.”
”However, owners of these malls look for successful merchants who are ready to convince them that the new store they are about to house has reasonable chance of success and will help the tenant mix,” she said.
Mrs Gbadebo added: “If, as a retailer, you are considering a mall for a first-store venture, your financial backing and merchandising experience must be proven. Some small merchants with good business records and proven understanding of the market have a good chance of being considered by a mall developer. So, if a particular merchant has a good reputation in retailing, it might make a strong case for acceptance into his/her choice mall.
Mall experts said before a retailer moves into a mall, it is necessary to ask: Are the mall’s shoppers my prospective customers? Would the mall offer the best sales volume potential for my kind of products? Can I produce the appeal that will make customers come to my store? Can I deal with the competition of other stores within the mall? How much space do I need to handle the sales volume I expect to have? Lastly, where do I need the space; i.e location within the mall? Some retailers prefer the first floor, while others the ground floor and then, close to the entrance or exit, they want to be in the main flow of customers as they move in and out of the mall. The truth is, that as long as a retailer is visible and can catch the shopper’s eye; such retailer will do well anywhere within a mall.
There are some retailers who wouldn’t mind the location but prefer a spacious store; they would rather go for the big stores. Of course, the amount of space needed will determine the shop rent; for the bigger the shop, the more expensive it is. Merchants need to rethink their space requirements when located in a shopping mall. Because, rents are typically high, so space must be used efficiently.
Looking at the brand value and the way people shop, it is actually cost effective to be in a mall. Some retailers actually look out for one, because they have seen the value of a mall.
If costs are high, the stress on retailers is less. They are not bothered on whether they have being provided with fake diesel; electricity is not a challenge, cleaning the mall is the management’s business, the management guarantees security at all times.
Some store owners at the Ikeja City Mall shared their experiences. Mr Saliu Azeez the owner of Identity, a clothing store, said his being in the mall has made him more popular.
Miss Moradeke Sholebo, the owner of May Brand, an accessory store also in the mall said: “The fact that people now shop in malls instigated my moving into the mall. Accessory store make huge sales, especially at weekends and people visit the mall more on weekends; so, I make double the amount made during the week. Another benefit is the location of the mall. It very easy to access”.
Miss Temitope Ashiru, a store attendant at Poise, said the mall is an interactive and business friendly environment. “Sales are better now that we are in a mall”.
For small retailers who can’t become tenants in a mall, experts believe they should look for strategies to cope. Such people should look at their merchandise rate and see what they can do differently. They could go round their neighbourhood and offer free delivery. They just have to keep moving with the time, they added.
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