Are You Ready to Move Your Business to the Shopping Mall?

October 22, 2012 | By | Reply More

Some businesses are simply not suited for home-based operations. Some businesses need to be physically located “out in the open” where people can discover it, buy your products or service and patronize it.

But where will you put your business? Should you put it in the mall, or get a small place downtown?

shopping mall

Your store’s location often spells its success or failure. Put it in a remote area and the visibility of your business suffer. Less traffic results in weak sales, poor cash flow, and eventually its demise. To offset your poor location, you need to blare your horns much louder and spend more in marketing and advertising to be in the consumer’s radar screen.

But put it in a good location and your business will thrive with ample traffic. If your business is highly visible, attracting new customers simply entail opening your doors.

If you think putting your store in a shopping mall is the answer, here are several factors you need to consider before you make the decision.

1. Costs

Rental costs in shopping malls are often higher than rates in downtown Main Street. Your main consideration should be: will the higher traffic compensate for the increased rental cost? Does it make financial sense to move your business to a mall? Will you still make money enough to cover your added expenses?

If you can easily recover your monthly rental payment, then go ahead and locate your store in a premium mall space. But if you think not, better be contented in your small town location — or even your own home.

2. Adequacy of traffic

Traffic is often the primary reason for locating a business in a mall. By offering a wide variety of merchants, shopping malls have evolved as the one-stop shopping paradise of consumers. Check its customer attraction power: not all malls attract huge traffic. Some are better at pulling in crowds than others.

Another important consideration: while some malls do attract crowds, the traffic the mall gets may NOT be your target market. Just because the mall is full of people does not necessarily mean that these people are interested in what you have to offer.

3. Quality of traffic

It is one thing to have good traffic, and another to have the kind of traffic that you want. Determine the suitability of the mall’s main clientele to your own target market. Some malls attract low-to-middle income people, while some malls are targeted towards the upper class. Look at the mall’s demographics ­ e.g. age, income, and family size ­ and compare them with your potential customers. Is there a fit?

4. Ability to intercept traffic.

The location itself of the mall plays a huge part in your store’s success. Is the mall located in an isolated part of the city, or right in the middle of action? If the mall is in a busy commercial district, you can expect large crowds even on workdays as office folks go to the mall for their lunch break or for a quick shopping. If it is in a relatively isolated place, weekdays may mean counting the tiles in your store’s ceilings.

5. Your store’s location within the mall

It doesn’t necessarily follow that placing your store in a mall will bring in the crowds. You need to be in the “thick of things.” Your best bet is to be in the main flow of customers as they pass between stores. Avoid getting dead-end spots, unless you are beside a major retailer that attracts huge amount of shoppers.

6. Complementary nature of the adjacent stores

Your success will depend on whether you are located in a section that is conducive to what you’re selling. If you are a gourmet store, you may want to be located near a restaurant where people are already in their “eating modes.” Complementary businesses, such as fine jewelry and gourmet food, also work well together as both its customers are likely to have disposable income & tendency to spend for these two products. Areas where lines of patrons form, such as theaters or department stores, are also good mall locations as it could give potential customers several minutes to look in your display windows.

7. Ease of entry & exist to your premises

The availability and adequacy of parking is a very important consideration in choosing a retail location. Malls in the United States almost always have ample parking spaces, but this is not always the case in many other countries. If parking space is a problem, consider its accessibility by public transportation. A mall owner in the Philippines had to build an overpass bridge for people to use. There should also be adequate space for pick up or delivery, particularly if you are selling bulky items like furniture.

8. Fit in the retail mix

Mall owners maintain a desired set of store mix. Your acceptance will depend whether your business fits with the owner’s idea of retail mix. Even if a space is available, if the owner feels that they already have too many crafts store, they will turn you down (unless of course you are a well-established business that can only bring prestige and additional clientele to the mall). If they still accept you, your next concern is to determine how will you stand out from your competitors.

9. Responsiveness of the landlord to merchant’s needs

The landlord can make your life as a tenant easy or difficult. Study how the landlord plans their retail space. Do they rent adjacent retail spaces to incompatible/directly competing business? Get feedback on how responsive and flexible the landlord is to tenant’s needs, e.g. placement & size of signs, speed in responding to requests for maintenance & repairs, etc. Are there policies that may hamper your marketing innovations?

10. Facilities of the mall

Customers go to malls for its convenience. How does it rate in terms of providing customer convenience? Does it provide weather protection? An atmosphere created for shopping comfort? Adequate number of restrooms? How is the mall’s security? Fire and police protection? Sanitation or utility supply? It must have good exterior lighting to attract evening shoppers and make them feel safe.

11. Potential for expansion

If your store grows, is there room for expansion? Explore this question during negotiations.

Also check whether the shopping mall has any major renovation plans, including expansion, and how this could disrupt your operations.

12. Acceptability of the Lease

Before signing any agreement, understand the provisions of the contract. Hire a lawyer if you have to. Are they acceptable? Some leases peg rent to sales volume (with a definite ceiling), while others provide a fixed rent. Some mall owners charge some fees for infractions of business rules (e.g. operating beyond the mall hours). Does it spell out the owner’s tasks in terms of repairs, construction/ reconstruction, decorating, alteration, & maintenance? Will the owner pay a certain percentage of decoration costs? Ask how the owner promotes the mall.

13. Other considerations

There are other considerations you should look into ­ convenience of its location to your home and capability to attract employees. Also look at whether major stores in the shopping mall are planning to leave their current location — the last thing you want is for the major traffic draw to leave the shopping mall and with it a huge chunk of foot traffic.

The shopping mall has radically changed the way people shop. It is therefore not surprising that perhaps the biggest benefit of locating in a mall is the subtle announcement you are making to the world that you are ready for the big time.

Recommended Books on Starting a Retail Business and Locating it in a Shopping Mall:


Jenny Fulbright

Jenny Fulbright

Jenny Fulbright is a writer for

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