Start with a temporary store
When we have a product that, having investigated the market everything seems to indicate that it will work, an excellent idea is to rent a Temporary Store in which to test the response of the passing public. To do this, we will contact the owner of a rental store and negotiate a short term rental of the same, during which time we can evaluate whether to set up our own store or a rental with a long term contract, we will find everything profitable that we want.
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When it is convenient to rent a temporary store
Let’s study the cases in which it is convenient to try a rent of a Temporary Store, instead of risking a permanent rent and the risks that it entails:
New Product: when we launch an innovative product, which has never been marketed before, at least in our market, it is advisable to try renting a store for a short period and see what response we get from potential buyers when they pass through our window. This will give us a clear picture of what will happen over the next few years.
Product Commercialized by Catalogues: if we have been selling products by catalogues and sales have been growing, it is time to try what would happen in a store open to the public.
Online Sales: when our online store begins to take off and there is a significant volume of orders, it is a good time to exhibit our creation or our products in a Temporary Store and give the public that does not handle the Internet, the opportunity to see and touch what so many people have been buying online.
Benefits of a Temporary Store
This type of undertaking has advantages for both the owner of the premises and the tenant of the premises. Let’s see what part of the slice each of them gets:
Benefits for the Tenant: Whoever has products to sell and is not in a position to embark on a long-term project, either because of the costs or because of the risks that a long-term monetary commitment implies, has the advantage of proving for one week, one month or half a year, the success that his business will have and can thus evaluate if he can commit himself to the maintenance of the premises for a long period of time.
Benefits for the Owner: When an owner of a rental property does not receive income from the rent, it is much better to rent it for short periods of time than to keep waiting for the miracle to happen. In times of crisis, a small income is better than the promise of a larger one that never comes.
Where the Temporary Store Concept Applies
This type of business is booming in the United States, in a broad market that is open to new ventures and business ideas. Now let’s analyze if the concept is applicable in Spain, which leads us to an imminent answer of “yes”, since with only the obtaining of a license that allows to speed up the short rents, the owners will be able to begin to receive income for their premises, while the new entrepreneurs will have the opportunity to try their product in direct contact with the public.
Requirements to start a Temporary Store
One of the requirements for setting up this store is that when you have a product that is tested has market and demand can be placed a temporary store to test the response of the public passing through.
To do this, it is necessary to contact an owner of rental premises and negotiate a short term rental of the same, during which time you can evaluate whether to set up your own tent or to rent it out on a longer term contract, if the product proves to be profitable.
Tips for starting a temporary store
If you are starting a new business, it is advisable to set up a temporary store because it is a good way to get a first contact with the retail industry and to experiment if the business idea works and if it is what you want to keep doing in a bigger and more formal environment.
It is advisable to set up a temporary store because it is the opportunity to do conceptual testing of products and business ideas, without the commitment of having a physical store so to speak.
Another tip is to create a sense of urgency by informing customers of the start and end dates of the temporary store event, with limited inventory, meaning that the temporary store will close once the items are sold out.
Having a temporary store during a specific time of the year such as Christmas further increases the urgency of buyers, as customers are aware of the exclusivity of the seasonal products.
In addition, it is advisable that if you have an urgency to reach the majority of customers and make the brands of the products known, in addition to releasing the seasonal inventory, you
products should be chosen that can be sold at affordable prices and that encourage impulse buying.
Similarly, if the store was placed online, the idea is to turn web browsers into particular buyers, at a time when several purchases will probably need to be made within budget.
Problems that may arise
A problem can be if the investor takes a risk with the permanent store and it turns out that the product is not in demand after a while. This can happen when an innovative product, which has not been marketed before, is launched on the market, so it is necessary to test a store for a short period and see what response is obtained from potential buyers when they pass by the shop window.
One success story is the pop-up stores, also known as temporary stores, defined as short-term retail outlets, which have become increasingly frequent and popular. Since, they do not only belong to the sector of small retailers or online entrepreneurs.
Large companies such as Nordstrom, IKEA and Amazon are using this type of store, because they are very effective in promoting new products, experimenting with an emerging market, liquidating what is left of the inventory and increasing brand awareness, while lowering overall costs.