A kiosk is a small structure or floor space in malls that are in the main corridors. Many of the kiosks are permanent businesses occupied by companies, year round, that operate retail or service businesses that does not require a lot of space. Information booths, cell phone companies and watch and jewelry sales/repair are a good example of permanent kiosk users. Malls also have temporary kiosks available for small businesses that only operate at certain times of the year, usually holidays. Christmas holiday is of course the biggest example of temporary kiosk renters, when they can make a lot of money in a short time period, but other holidays make money as well. This business opportunity is available to anyone that has a desire to earn more money and can follow the requirements of the mall.
1. Before contacting the mall to reserve the space, you will need to do a little homework. For example, what will you sell? Malls restrict the number of retailers selling items that compete with retailers already in the mall. Mall management wants a variety of vendors in their kiosk spaces to draw larger crowds. When you begin your product research, decide on three or more unique lines to present to mall management.
2. Another requirement the mall has is liability insurance. One million dollars of coverage is normally the minimum amount the mall will accept. The premium for say eight weeks at Christmas time will not cost as much as you may think. Most insurance agents can provide you all of the particulars needed to purchase a policy.
3. State sales tax license and local business permits are your next consideration. Virtually all states will require you to collect sales tax on all merchandise you sell. Merchandise wholesalers will also require you to fill out a sales tax exempt form with your license number or they will charge you sales tax on your purchases from them. Note: Some wholesalers consider your sales tax number your license to do business with them and may not sell to you at all without it. If you live in one state and sell in another state, you will need a license for the state you are doing business.
4. Location! Location! Location! Before meeting with mall management, scout the malls to determine where the busiest areas are. A good location is as important for your bottom lines sales as anything else you do. When you are finally ready to contact the mall to negotiate a temporary or a permanent lease, find what spots in the mall are available. Some spots are permanently assigned to businesses that set up every year. They will always get first pick at prime locations. What you are looking for is a space near the center of the mall or near entrances to the anchor stores. Of course, everyone cannot get the best spaces, so make the most of what you have. These spaces are reserved months in advance so plan accordingly.
5. The worst part of retail business in malls is you must be open when the mall opens in the morning until it closes at night. If you and family members can cover these times, you are in better shape than those who will hire employees. Employees are a different can of worms that will require you to obtain a Federal Employer Identification Number (EIN) to report withholding taxes, workers compensation insurance in case a employee gets hurt. Add managing employees, schedules wages and all of the headaches that go along with employees and it could be a business killer before you even get started.
Operating a kiosk in a mall can be very profitable or can be a huge loss. Careful planning and execution will make your experience more enjoyable.
Tip: Your bank will be happy to set you up to accept credit/debit cards. Avoid those sales representatives trying to sell you a credit card machine for some company you have never heard of.
