Rent, Rent, Rent
A real estate magnate, Lord Harold Samuel coined the phrase: “There are three things that matter in property: location, location, location.” No other factor is as important to the success of your business as the location you choose.
Location is not the only consideration. You also need a quality product, a clean booth and friendly employees. You also need signs that are bright and visible from the main street and sidewalks. None of this will do any good if you can’t attract customers to your area. Careful determination of new sites is essential for most retail businesses. I can give you some general guidelines and things to consider when making this decision. It’s time to put the location at the top of your to-do list. Below are some of the things you should consider.
For a basic snow cone stand, a little common sense is the main component in making decisions. There are software tools that will give you traffic patterns, demographic information, and other data, but you should locate your booth not only in your city, but also in neighborhoods you know. You should know, just from living there, the main areas to search for locations.
You should be looking for an area with young families and kids or high school kids who can drive. Elementary, middle and high schools are good areas. Parks, swimming pools, and children’s sports complexes are also good indicators of the right demographic. High-traffic areas like malls, restaurants, and stores are another good indicator. Depending on your city, foot traffic or vehicle traffic will be much more important. Another indicator is if there are other kid-friendly businesses in the area. Do you see an area with a concentration of ice cream parlors, toy stores, game rooms or other similar businesses? If these businesses are successful in this area, chances are you will be too.
Once you’ve decided which areas to consider, you should test your placements to see what will work best. The easiest way to check is to simply go outside and look at the area. Park in the place that interests you and watch the traffic. Are there many children running around the local park? Do you see as many cars as you expected? Are families going in and out of local businesses? Sitting and looking on both a weekday and a Saturday can be the best way to really get to know an area.
Leasing and Renting
There is more to do for your snow cone stand at this point. Just because you’ve found the parking lot or store front of your dreams doesn’t mean the job is done. Hopefully there is more than one place that you think will work for your business. If this is the case, you should start reaching out to business owners to sign a lease. Your rental agreement is almost as important as the location itself. A good landlord can make your business run much better, but a more difficult one can cause you a great deal of trouble and stress.
In general, there are 2 types of business owners you can work with: small business owners and large chain stores. Small business owners are much easier to work with. You can usually deal with the owner personally and the business owner will appreciate the rental income. The corporate headquarters typically handles the rental of parking spaces for a major chain of stores. In this case, you can’t just walk into your local Wal-Mart, Target, or Best Buy and sign a lease. Trying to deal with a corporate office means spending a lot of time on the phone trying to find the right person to talk to. Even when you do find them, you should expect them to care enough to call you back. The person on the other end of the phone will not see any of your rental income, but they have to go the extra mile to help you. There is no incentive for this to happen. There are also a number of chains that have a general policy of not dealing with small businesses or renting parking spaces.
The amount you must pay for rent will vary considerably from city to city and from place to place. In my experience, $250-400 was an average rental range, but this may not be accurate for your situation. I suggest asking other snow cone and concession stand owners to get a range of the going rate. Be sure to indicate whether the lease includes electricity for your booth and how you obtain power. Other issues that are easy to forget are where you can empty your dirty water tanks and throw away your trash. You also need to make sure that there are places for your customers to park and the hours that you can keep the booth open. This may seem like a no-brainer, but you need to make sure you and the owner are on the same page. If you don’t explain this in detail, then a different set of ideas can cause you a lot of trouble.
Take into account all the costs associated with the initial opening of your business and the location. This information is crucial to correctly budgeting and planning your opening. When it comes to starting a business, underestimating the costs and time involved is one of the most common and dangerous mistakes new entrepreneurs make. It is also one of the simplest to avoid.
The best advice I can give anyone is to be thorough in your research. There are no perfect or simple answers. Know your city, area and the particular location. Test your assumptions and do the legwork to make sure the place is as busy and kid-friendly as you thought. Good luck!