or loft/studio space. These options are considerably cheaper than renting retail space, and you will still be able to receive customers. Choosing this option has the advantage of the professional image it lends to your company. Many large corporate accounts will feel more comfortable doing business with a company in an office building.
Another option is the “packaged office.” This type of facility usually takes up the entire floor of an office building. Each company has one office space. There is one central reception area and a receptionist who can accept deliveries, take messages, and for a separate fee perform secretarial services. These offices generally have a photocopy machine and fax machine available, which all the tenants share. You could run your business out of this type of space, but you would still have to make your gift packages elsewhere.
d. Signing a Lease
If you rent or lease space, you will need to decide what kind of lease agreement you are willing to sign. The longer the lease term, the lower the monthly rent, but you are responsible for the full term of the lease whether you are still operating the business or not. Some lease agreements will not allow you to sublet the space.
For a brand-new business it is probably best to take a one-year lease or month-to-month rent at a higher rate until you have ascertained how well your business is going to do. It also gives you the option of moving to larger premises if your first year of business is very successful. Always seek competent legal advice before signing any kind of lease agreement.
Before renting or leasing space ask yourself the following questions:
(a) Is the space accessible for receiving and shipping?
(b) Is there a loading bay and elevators?
(c) Is there sufficient parking for delivery trucks and customers?
(d) Are there enough electrical power outlets for your equipment?
(e) Is the lighting, heating, and air conditioning sufficient?
(f) Will your lease allow you to make necessary alterations, such as installing track lights and shelving?
(g) What type of advertising sign is allowable in your lease agreement?
(h) How safe is the area and the building?
(i) Will you be able to buy reasonable insurance against burglary and fire?
e. Shared Retail Space
I have said previously that I believe a retail gift basket operation is too high a risk. Retail overhead is very high, and it is unlikely that you could sustain a profitable business without introducing other aspects to your business.
However, sharing retail space with another business may be a viable option. Shared space can range from simply having your gift packages and brochures on display in a noncompeting type of business (expect to pay some type of commission for orders taken by the other business on your behalf), to actually running your operation in the same space as another business. If you decide to become involved in this type of situation, be prepared to pay a portion of the rent and other expenses. Have an agreement in writing with the other business owner, and make sure you know exactly what you are getting for your money. Before you agree to this type of arrangement, meet with the other business owner and discuss the following questions:
(a) How much space will be allotted to you for displaying your product?
(b) What portion of the rent will you be expected to pay?
(c) What other expenses will you be expected to share in?
(d) Will you be able to install your own business telephone line?
(e) Can you share the fax machine and line?
(f) Will you be allowed to have signs advertising your business outside and inside the premises?
(g) Is there sufficient storage space and work space to operate your business?
(h) Can you share other office equipment?
(i) Is the other business owner willing to market and advertise their business in conjunction with yours?
(j) Do the terms of the other business owner’s lease allow for this type of sharing?
(k) Will you be covered by the other business owner’s insurance in case of fire or theft?
Obviously, there are advantages and disadvantages to this type of arrangement, but if you find the right person and complementing business, it can be highly beneficial to both operations. One advantage is that the two of you can watch over the other’s business when it is necessary to be out of the workplace.
f. Seasonal Kiosks
During the busy December holidays, you may want to consider taking a kiosk space in a shopping mall, produce market, office, or public building. This can be as simple as setting up a table of sample gift baskets, handing out brochures, and taking orders, or a more elaborate portable structure that you have designed and built. If you run your business from your home, renting a kiosk can provide valuable added exposure to your business during this busy time. Even if you are renting office or studio space, which provides more exposure, you can attract new “walk-by” customers by setting up a seasonal kiosk.
However, keep in mind that renting a kiosk can be a large undertaking, and I do not suggest you try this the first year of your operation. Instead, during your first December of being in business, take a day or two to research locations for the following year. This will give you the opportunity to observe how others run this type of seasonal business and let you choose a location that seems to generate the most traffic.
If you decide that it is a viable option for you, start planning a year in advance. Find out who is in charge of leasing at the site you decide upon, and contact them in early January. Ask the following questions:
(a) How long is the period of operation?
(b) What hours are you expected to keep?
(c) What is the rent?
(d) What special licenses or permits do you need?
(e) What type of insurance do you need?
(f) What type of security is available?
(g) Is there a locked storage area available?
If you decide to try this type of venture, it should be because your business is successful and you are at a point where you can afford to hire someone to work the kiosk. If you cannot afford to hire a student or temporary employee to run the seasonal kiosk, then you should concentrate your efforts on running your already-established business from your home or office. The December gift-giving period is too important a time for a gift basket company to risk having you away from the office or workshop.
If you decide to have a custom-made kiosk, have a cart on wheels built. This can be rolled away at night and put in a secured area. It will also be useful throughout the year because you can use it for display and at craft shows and trade fairs. Depending on how elaborate you want to get, you should be able to have a mobile cart designed and built for
