The name “pop-up shop” seems to be the new name for what used to be called a short-term lease. Pop-up shops or stores continue to grow because they can be a low-cost way for businesses to offer products at a locale without a long commitment. Many seasonal or new business ventures have gravitated to opening pop-up shops over the last few years because of this.
According to a pop-up service provider, pop-ups have become a $50 billion industry. Even though standard short-term leases are nothing new, both renters and landlords have grasped onto them because they can provide a duel benefit. A landlord can rent space that may not currently be in use and a renter can open a small-business without a long-term commitment. With a short-term lease, leasing arrangements can be simplified and financial considerations such as upfront expenses may be avoided. Even though a pop-up shop lease may be simpler than a standard lease, there are things that should be considered if you are looking to sign this type of lease.
Understand what is covered
When it comes to leases, many times the agreement can cover additional items other than the space you are renting. A lease can dictate things like the type of business you can operate and how you advertise the business on site.
Be respectful to the property owner
When a good relationship is established, coming to an agreement on a lease will most likely be easier. Because a pop-up shop will probably be a unique experience for the landlord, you should listen closely to their concerns. If you are hoping to grow your pop-up and expand it, starting off on the right foot with the landlord may prove crucial.
Research the area
You should know the pros and cons of the space and have any questions or concerns ready for the landlord during lease negotiations. Things like parking, traffic flow, hours of operation and lighting are just a few of the questions you may have.
Have a business objective
Do you have a business plan in place? Even for small or short-term businesses it can be very critical to know your goals and how to accomplish them.
Be aware of “right to relocate” clause
As the name implies, this clause in an agreement would give a landlord the ability to relocate your pop-up shop. It is a good idea to review the clause and make sure if there would be a relocation, the new space is comparable to the original.
Are you ready for a long-term lease?
If you have had a successful pop-up, you may want to consider signing a long-term lease. If you experienced limitations from your short-term lease, these can be brought up when negotiating a longer lease. Longer leases can also have the potential of lower monthly rent due to the length of the contract.
A pop-up shop may be just what you are looking for if you want to try a business out on a trial basis. However, even with a pop-up shop a landlord can have direct stipulations in the lease that can affect how the business will be run.