antique malls
TRANSCRIPT
The Antique Mall Business
Legitimate Opportunity- or -
Lessee Beware
Nuts and BoltsAntique BoothBusiness Plan
Antique Malls
Present a QuickLease and Make ItSooooooooooooo
Easy!
Antique Malls
Step Back
Take a Few Weeks
Do YOUR Homework
Antique Malls
A BusinessUsually Borrows Money
From aBank
Antique Malls
A BusinessUsually
Needs a Business Plan
Antique Malls
This analysisIs not requiredTo begin your
Antique Mall Booth.
DO IT ANYWAY!
The World Changes. Antique Malls are as antiquated as Kress’ Department Store.Antique Malls prey those who have never owned a business.
Seniors are particularly vulnerable.
Do not be afraid to ask questions.
The owner will not beafraid to cash you
check.
This isNOT
A good way to downsize.
This is NOT a substitute for an
estate sale.
QuestionsWho to Ask?
Ask the Owner/Manager and ask the dealers.
Take note of the questions the Owner/Manager refuses to answer.
If the owner has more than one mall – go to other mallsto speak with those tenants as well.
Mondays and Tuesdays when dealers are working on their booths is the best time to speak with them.
QuestionsOwner or Manager
Many owners hide behind their managers.
You can never get a definitive answer.
Ask if you can go directly to the owner.
Question 1What Price Range and Products
Move?
• What is being sold?
• Large items over $100?
• Antiques over $1000?
• Nostalgia/vintage items under $35?
Can you generateREVENUE
Two to Four TimesYour Rent
Per Month?
To GenerateTwo to Four Times
Your Rent for RevenueInventory Value Must Be
TEN TIMES YOUR RENT
Antique Malls Viable?
• Talk to other dealers.
• Be there most of the day several Saturdays a month.
• Watch shoppers.
• Are there shoppers?
• Are they browsing or purchasing?
• What is the value of their purchase?
• Is the purchased merchandise from a vendor with a large inventory, an exclusive inventory and/or a prominent location or from a smaller vendor?
Do Your Homework
Question 2Locations
Location within the antique mall matters.
Of course, managers and owners KNOW this but they’ve seen you coming!!! They will never tell you this.
They MUST rent out the poor locations as well as the good.
Where are the high traffic areas? Watch traffic patterns.
Question 3Turnover
How many dealers stay six months only?
How many dealers stay one year only?
Which locations have the highest dealer turnover?
Ask dealers if they are generating two to four times their rent per month.
Question 4The Exclusive
How many dealers have an exclusive?
Show me their booths.
What will you be unable to carry because of their exclusives?
Look at:
• The number of square feet of the booth
• The value of their inventory
Question 4The Exclusive
Some Antique Malls have you specify the products you will carry.
Add everything and the kitchen sink.
This is not negotiable AFTER you sign the lease.
Before you sign is the time to do this.
The Antique Mall Business
In most antique malls some lessors have “exclusives.”
This means only they can sell this product.
Typically this provides an advantage.
They compete with no one.
Ninety percent of the vendors do not have an exclusive.
This ninety percent competes for the remaining mall traffic.
Legitimate Opportunity or Lessee Beware
The Antique Mall
Exclusive
How prominent is the location of the dealers with
exclusives?
Booth LocationThe browsing shopper has a sum specific to spend.
They will purchase from the vendor with a good location and even pay more for an item than purchasing from a vendor with a bad location.
It is like “Black Friday.” Stores want to be the FIRST to target the shopper.
Booth owners want to be the first to entice a purchaser.
ANTIQUE MALLS DEPEND ON THOSE NOT MAKING MONEY
TO KEEP THEIR DOORS OPEN
The reality is generally that only twenty percent of the vendors pay their rent, cover their inventory costs and make a profit.
Eighty percent of vendors LOSE MONEY AND just cover their rent, or cover their rent and do not cover their inventory, or do not make their rent
EIGHTY PERCENT OF THE DEALERS SUPPORT THE TWENTY PERCENT MAKING A PROFIT.
Question 5Inventory Value
You will find those dealers making the most money have an expensive inventory and unique products.
Figure out who those dealers are and value their inventory.
Are you willing to make that kind of investment in a unique inventory?
Are you willing to invest ten times your rent in inventory?
Or will you compete with the ‘other’ 80% of dealers for the remaining 20% of the revenue.
The Antique Mall BusinessLegitimate Opportunity or
Lessee Beware
The 80 – 20 Rule
20% of the dealers make a profit and generate 80% of the Mall’s revenue.
Are you willing to invest in your inventory to be in that 20 percent?
Eighty percent of the dealers compete with each other for
Twenty percent of the revenue.
Look at the value of the inventory required to earn two to three times your rent per month?
Can you generate revenue two to three times your rent per month?
What inventory value do you need to support your sales
per square foot of your booth?
For those dealers earning two to three times their rent analyze the value of their inventory.
Are you willing to invest in that inventory?
These numbers MATTER if income matters.
Be prepared to have a very expensive inventory per square foot if you want to make money.
What inventory value do you need to support your sales
per square foot of your booth?
Question 6Marketing
What kind of marketing does the Mall do?
How much do they spend?
Where do they spend it?
You will have to use your common sense to determine whether marketing is effective or an illusory placebo to keep the dealers ‘happy.’
Web Presence and Marketing
Marketing Plan or Hit and Miss
How much does the Mall spend on advertising annually?
Where are these dollars spent? i.e. with the Mall owner’s daughter at college who updates the website twice a year?
Is social media used effectively or is it an afterthought?
Where is the print media?
Where is the television media?
What are the Google Local rankings for this Mall?
Marketing
Who Is the Mall Marketing To?
Fresh Blood? New Vendors to Replace the OLD?
or Does the Mall Market its
vendor/dealers products?
Web Presence and Marketing
Marketing or Wishful Thinking?
What is the quality of their web outreach?
How often is it updated?
Do they have real and legitimate events that bring in shoppers?
Are the events simply dealer appreciation events that bring in no shoppers, i.e. hot dogs on the Fourth of July! Candy on Halloween!!! Santa at Christmas!!!
Web Presence and Marketing
Mall EventsWhen the mall tells you about “events” they have do not assume these “events” draw legitimate traffic and shoppers.
Attend an “event.” If these events are more like free hot dogs and no one but the vendors are partaking – discount that as marketing with any value.
Ask them how they market these “events” and review that marketing.
Are the owners providing incentives with their events?
Are they giving away a desirable product in a drawing?
Are they providing ANY added value to the shopper?
(Besides hot dogs and balloons?)
“I have an idea!”Change Plan Ask Questions
Consult with Professionals even if only informally. Do not accept that manager/owner really understands/accepts the issues.
Implementation
Waiting for
Impact
Dealer Renews Lease in Hope of Change
Return to Status
Quo
Plan
“I have an idea!”Change Plan Doomed to fail
Consult with Professionals even if only informally. Do not accept that manager/owner really understands/accepts the issues.
Faulty, Limited
orUnprofes
sional Implementation
Return to
Status Quo
Plan
Antique Mall – Scam or Real?
If you are ready to jump in without spending a couple of ENTIRE Saturdays watching mall traffic and shoppers then be prepared to lay down your money with no return on YOUR investments.
The only party with the return on investment will be the Antique Mall owner!
Do Your
Homework
Question 6What Are the Shopping
DemographicsIs this antique mall located in a neighborhood of families actively furnishing their homes?
Is this a mature neighborhood where you might be expected to sell a small nostalgic piece?
Can you generate sufficient revenue selling only small nostalgic pieces?
Antique Mall Profits – Scam or Real?
Location, Location, Location
What is the demographic of the shopping outreach?
Are the homes established and families grown?
BAD!Is this a young area with large homes and young
families?
Good!
Antique Malls
Usually Locate inDeclining
Shopping CentersDeclining – Aging –
Neighborhoods
Aging NeighborhoodDeclining Shopping Center Affordable Older Demographic – Less Disposable Income
All FactorsIn Decline
Declining Spending
Power
Increased Shopliftin
g
Older Shopping
Center
Less Affluent
Demographics
Question 7Shoplifting
Does the Mall report ALL shoplifting events to law enforcement?
If not why not?
Is shoplifting a problem?
Are the cameras manned at all time?
IF THE MALL HAS CAMERAS ASK TO SEE THE CAMERA FOCUSED ON YOUR BOOTH. OFTEN CAMERAS DO NOT COVER ALL BOOTHS.
Shop Lifting and Antique Malls
Because antique malls are generally quite large and typically EMPTY of shoppers and vendors they are shop lifting targets.
Talk to the vendors about shop lifting.
Ask the Mall whether they report each incident to the police department.
Most likely they do NOT report these events. They want this issue kept as quiet as possible.
Scares off tenants!!!
Shop Lifting and Antique Malls
Are there cameras?
Is your booth covered?
Are they manned? How often?
What is the shop lifting rate?
Does the mall report shop lifting to law enforcement or just keep it quiet?
Shop Lifting
the Dirty Little Secret that
Scares off tenants!!!
Ask to be taken into the video camera surveillance room.
Actually LOOK at the view of your proposed booth.
Make sure it is completely covered.
If it is not covered by surveillance put it in your contract that cameras will be added to cover your booth.
Do not sign the lease until you see the cameras from the surveillance room.
Make sure the cameras are focused on YOUR BOOTH.
Question 8Competition
Open your eyes to competition.
Young families do NOT want antiques.
Mid-century modern appeals to young families.
The buyers for your mother’s antique malls are dwindling and will be in nursing homes in ten years.
Destination Vintage Flea Markets are the BIG BIG THING
Rose Bowl Flea Market
Pasadena College Flea Market
Long Beach Antique and Flea Market
Fresno Flea Market - Big Indoor Fresno Flea Market
HUGE COMPETITION FOR ANTIQUE MALLS
Twenty Years AgoThis Competition
Did Not Exist
DYING BUSINESS MODEL
MillenialsDo NOT
WantAntiques
That’s Why PeopleAre Selling This
Stuff – TheirKids Don’t Want IT
Antique Mall CompetitionExpensive Furnishings – what is your competition?
Do interior designers use this mall as a resource?
What outreach does the mall have to designers?
Vintage Items – what is your competition both within the mall amongst the dealers and in the geographic area?
Realistically how far will a person drive for vintage shopping?
Ebay or Etsy Competition - How many of these vintage items are offered on Ebay or Etsy?
Antique Mall CompetitionOther Antique Malls
How does this one stack up?
Realistically what other antique malls are direct
competition?
Watch their traffic and shopping trends as well!
Antique Mall Competition
Home Furnishings
You are competing with Ikea, Nebraska Furniture Mart, Craigslist, Offer Up, Rooms to Go, discount malls, malls and companies that offer financing.
Garage Sale Pricing – you cannot afford garage sale pricing and the current painted furniture trend relies on garage sale, throw away furniture.
This is a business model that is DYING.
Estate Sales Are Now Online
Not only has your competition for buyers become more aggressive
Your competition for product is more aggressive
Estate sales are now online.
Buyers can bid online.
You are competing with your own buyers and other vendors as well for merchandise.
What are the Mall’s Gross Sales
Look at the Overall Mall Revenue (too)
Divide Gross Sales by
Square Feet
Compare the revenue per square foot with other sales venues.
Antique Mall Competition
Dying Mall or Thriving Mall
Ask the landlord why this Antique Mall is not one of the many dying Malls. What makes it different?
Technically, the relationship with your landlord is business to business.
Tenants are expected to be business savvy.
Know before you sign that lease.
Most tenants have no business experience and are on the verge of have a losing situation.
Antique Mall Competition
Can the Best Public Relations FirmThe Best Marketing
Drive Demand
Ikea --- Nebraska Furniture Mart ---Craiglist --- OfferUp--- Repainted
Furniture Trend --- Rooms to Go --- Cheap Financing
Glittering Designer Districts Competing not only for wholesale but
retail.
Antique Mall Competition
Can the Best Public Relations Firm
The Best Marketing Drive Demand
Probably Not.Unless the Antique Mall becomes a destination
with shopper events it will never, never thrive.
Question 9Owner/Manager Competition
Does the owner or the manager have a booth?
This means they are competing with you on an unlevel playing field and have access to crucial information including:
• Best booth locations
• Products selling
• Price of products selling
Antique Mall ExcusesOwner / Management
Competition
Owners and managers compete for items being sold at estate sales.
They have inside information on what is actually selling, items, price point and
location.
This is information they do not share with you.
Typically, they give themselves the best locations.
Does you owner/manager compete with you and have a booth in the Antique Mall?
Question 10Owner/Manager Involvement
Does the owner meet with the tenants or make excuses for not discussing mall issues in a group?
Does this antique mall solve problems or make excuses?
Antique Mall Excuses
Owner Involvement
Is the owner willing to step up to the plate and
have mall tenant meetings or do they dodge these
important issues?
Owner Not Willing to HaveTenant Meetings
The owner will gladly meet one on one with a successful and large tenant.
These tenants have a direct line.
If the owner is not willing to have group meetings with the 80% not generating good revenue – RUN!
There is a REASON the owner dodges group meetings!
• There is no benefit for the owner!• The owner has no intention of helping that 80%.
Antique Mall ExcusesInsidious Mall Suggestions
The Mall staff is adept in suggesting the problem is yours!!!
Better merchandising will bring better results!
Low pricing (which will not pay your rent) will bring better results!
Rotate your merchandise (which means more investment) good for the Mall but is that good for you?
This is a great hobby! Did you really expect to make money? Some people play golf! I do this!
This is all about having fun! Are you having fun? Did you really expect to make money?
Antique Mall ExcusesInsidious Mall Suggestions
January is a bad month – after Christmas.
February is a bad month – no one wants to get out.
March is a bad month – spring break!
April is a bad month – Taxes!
May is a bad month – end of school activities!
June – July are bad months – vacations!
August is a bad month – back to school!
September is a bad month – getting settled after the summer!
October is a bad month – families are busy!
November is a bad month – getting ready for the holidays!
December was bad – people were worried about the economy!!!
Antique Mall ExcusesInsidious Mall Suggestions
It’s the weather stupid!
Too Hot!
Too Cold!
Too Nice – customers out enjoying it.
Too rainy.
Too muggy.
This Ain’t Your Mother’s Antique Mall
What is your Mall owner doing to help the tenants not making a profit?
If they are simply churning tenants then do not be surprised if you are part of the CHUM
Torchlusspanik This is a German word.
It means the fear of diminishing opportunities as one AGES.
Antique Mall Ownerstypically prey on seniors who
have never owned their own businessto be their unprofitable 80 percent.
Ask the hard questions.Get HONEST Answers.
Has This Antique Mall Owner
Ever Filed for Bankruptcy?
Personally or with another antique mall?
An antique mall ownercan file for bankruptcy
owing YOU moneyfor your sales.
Do the NumbersAdd Up for You?
Is the Situation Right?
Rent: $500 Revenue Should Be: $1500 to $2000 per
month
Inventory Value Should Be: $5000in order to generate sustainable revenue
Does the Mall have the traffic to generate these buyers?
Do you have a unique product and a following to generate these buyers?
Rent: $500 If you cannot turn over half your
inventory MOST MONTHS you cannot make it.
If you genuinely expect to make even a small profit ---
RUN NOW
$WITH YOUR MONEYYOUR TIME
YOUR EMOTIONS IN TACT
$Exploitation of Hoarders
Hoarding has received national attention with television programs.
Perhaps the most insidious aspect of this business is its attraction to hoarders and exploitation of their mental illness.
Antique Malls are NOT a solution to addressing this disease.
Antique Malls represent a complication of this disease.
$People who
Exploit
Seniors And
Mentally HandicappedAre known as
GHOULS
Antique MallShowroom
Square Footage
30,000 SF
$5.00 a square foot sales should generate
$150,000 in gross revenue a month for dealers to break even
$300,000 in gross revenue to double rent
$450,000 in gross revenue to triple rent
The chances your antique mall
is generating $10 a square foot
are extremely low.
You Don’tNeed This
The onlyReturn on
Investment that matters is the
Owners Return on Investment
Antique Mall ROI The little bit the owners scrape off your sale is irrelevant.
The owner’s Return on Investment
depends solely on drawing in the eighty percent that pay the rent for the twenty percent actually making an income.