Rent a shelf shop

Charityworker

I run local craft and wedding fayres. One of my regular stall holders is opening a vintage tea room with a smaller lockable shop next to it and they have offered to sublet it to me for £35 per week all in as a rent a shelf shop. The shop is roughly 21ft by 21ft. It's too good an opportunity to miss so I've decided to give it a go.

I am going to put roughly 15 shelf units around the walls which I'm going to be charging £10 per week for crafters to rent. I put out some feelers on my Facebook page and had 31 people respond saying they would be interested in this. Then 2 6ft tables in the middle which crafters can hire for £10 per day to offer craft workshops. I've already got 3 people interested in this. And a friend who wants to do angel card readings wants to rent space.

I'm going to be employing my 18 year old daughter to work in there on a Saturday. I'm aware I still have to pay her the minimum wage, get employers liability and give her a wage slip.

Is there any other tips anyone can give me?

Savvy_Sue

Get your subletting documents checked by a solicitor.

paddyrg

Get your terms checked too - if I rent a shelf for a tenner a week, and the diamonds I'm selling get stolen, I'm coming after you unless we agree upfront whose problem security is. What about breakages, too? What about breakages caused by people who are doing a workshop in the middle bit? Who is responsible for what?

How do you screen for products. Next to my shelf of diamonds, I have one of BNP propaganda, next to that one of cheap unsafe Chinese electrics, then one of 'top shelf' magazines. You need a plan and policy.

What's your share of the sale values? My diamonds sell for £10,000 each, do I get the shelf for £10/week still? My BNP leafleture will never sell any, it's just a display stand, really, with offensive ideology. Maybe think about taking a percentage of gross with a floor of £less a week instead. On a slow week, you get the guaranteed minimum from shelf rent, on a good week you get a slice, making it worth your while promoting and maintaining the shop.

Are all shelves equal? I'm your first customer, I bagsy 4 eye-height shelves for my unsuitable tat. People with stuff you actually want to be selling aren't getting the sales because the eye is drawn to my crock. But we're all paying a tenner. Do I get to hog your prime selling space by being the first one to sign up? Or is there a fairer model? How about every quarter you auction all the positions? Or have a random draw? Both not ideal as my lead ingot collection may cause instability on a top shelf, but something you have to think about nonetheless.

What about people haggling? Are items all fixed prices? Or do you have to phone the shelf renter to ask each time? Or do you have a discretionary haggle 'ask/take' percentage or list? Is this out of your percentage or the vendors?

What about non-payers? My pile of BNP propaganda had been sitting there for 3 months and I keep promising to pay next week. Do you take it off the shelf and store it? Try to sell it to pay my debts (good luck with that!)?

VAT - probably not an issue at the moment, but look down the road where you're taking £1500/week through the till, and take advice how that's handled so Mrs Olddear's teapot cosies aren't attracting VAT because of my diamonds. It's probably easy to sort, but needs to be structured appropriately.

Tracking - each item will need some kind of tracking reference and you'll need to be reconciling books in a weekly basis. Don't underestimate how dull this will be.

Just a few thoughts to chew over! Hope it goes well

catmulogen

Hi Charityworker
That all sounds very exciting but, as Paddyrg points out, there's lots to think about. I actually rent space in a couple of different shops at the moment and have rented in space in about 6 different shops in total. All have required me to have my own insurance and have stated that I would not be covered by the shop's insurance. The contracts have varied greatly between the different shops but have all basically outlined the minimum rental term, notice required, how and when payments should be made for rent and when payments will be received for goods sold. In each shop I have been allocated my own code which must be attached to all priced products. The shop then keeps a spreadsheet of what is sold each day and price paid. Finally, I have paid rent only in some shops, rent & commission in others and just commission in others. All have pros and cons.

Good luck and do feel free to pm me if you think of any more questions.

catmulogen

Oh, a couple more things to think about - do you want to go down the handmade / bought in/ mixed type of goods route? Ensure any items requiring CE testing have it. Likewise correct labelling etc for soaps, hand made candles, food items (food hygiene certs?). No counterfeit or copyright items

l1nda83

Lots of fantastic points there that I would never think of. The only other thing that came to my mind is what to do if your shelf is sitting empty. Say you have a crafter who can make you 10 products at week. They all sell on Monday. It's enough to cover the crafter's costs so they are happy, but you have an empty shelf for the rest of the week which looks bad in your shop. Or what about if that person is ill and can't restock for a few weeks. Do they loose their shelf or do you keep it empty or have a back up plan.

Charityworker

Ok Thankyou for all your replies. Some good points to think about thanks. I have examined the t&cs of a lot of similar shops to what I want to do and am in the process of writing up a t&cs they have to sign.

I'm going to be buying in 15 shelf units which are all the same size so no arguments about one person having more space than someone else. I'm going to put battery operated spotlights inside each one. I'm buying 2 6ft folding tables and 9 stackable chairs for workshops.

I'm going to be asking for payment from each crafter on the 1st of each month in advance. If they don't pay it in say 3 or 4 days their things get put in the storage cupboard for them to pick up and I'll contact the next crafter on the waiting list. I've got 1500 crafters on my books so it shouldn't be a problem. All crafts must be handmade. Nothing bought in ready made. If they want to take their stuff out of the shop they will have to give me 2 weeks notice. They must all be insured and I'm not going to be responsible for theft or breakages but I will always endeavour to make sure these don't happen. I'll make records of what each crafter sells and at the end of each week email them a list of what's sold and send their money to them. In the event we have an empty shelf I'll contact the crafter and invite them to come and replenish it.

Does anyone know where you can buy cheap lockable shop cabinets with a glass front? Cheapest I can find are £500 each.

paddyrg

Cabinet with a lot of shelves - this kind of thing?

http://www.ebay.co.uk/itm/showcase-shop-display-glass-cabinet-with-lights-H188xL182xW46cm/311448111578

Remember a shelf's value is going to be affected by height/position as well as space, but sounds like you have plans in place

Owain_Moneysaver

It would put me off going into a shop to browse if there was a craft workshop taking place.

And it would put me off going to a craft workshop if odd people were wandering around.

Sales will be lower if everything is locked behind glass. People like being able to touch things.

Remember to factor in credit/debit card fees or cash banking fees into the fees you charge the crafters. A decent electronic till / point of sale system will record what sells and what is due to each crafter.

You will need to be able to reclaim from a crafter the value of any goods returned for refund where the payment has already been passed on to the crafter.

Owain_Moneysaver

If there is any precious metal jewellery then it will need to be hallmarked and you must display a hallmarks card.

Charityworker

Thanks for your replies.