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Running a Restaurant/NEGOTIATING A GOOD DEAL FOR A STORE IN A FOOD COURT IN A MALL

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Question
Hello David,

My name is Stoian and I am a co-owner of a small business located in Los Angeles.
I am thinking of expanding our business and we are interested in opening a store in a local mall.
I was researching online everything about food court business in malls when I came across different experts who offer their service for negotiating a better deal with malls. One of them was yours so I decided to email you.
Here is the deal I have:
A Westfield mall located in suburbans of LA(a busy location).
The landlord asks me for 3 monthly rents as a security deposit + to do remodeling on the store.
The remodeling it has to be by their criteria and it could costs up to $ 100,000.
There are a lot of other small charges(which are going to build up to a big amount), but my bigger concern is how can I negotiate a better deal with such a giant as Westfield?

What can I do for successful negotiations ?

Thank you very much.

Best Regards,

Answer
Hi Stolan,

I will do my best to help you.  Getting into a good mall with a new food court concept can be challenging.  To do so with a favorable lease can be difficult, but it is possible.

These are the elements you need to address:

First of all, you will need a sound business plan, both for their sake and yours. They want to know that your concept can produce the revenue needed to meet your rent obligations - and you need to know this as well.  Mall food court rents can be very, very high.  The tradeoff is that with a strong mall comes the potential for strong business.  Your food court concept will need to be capable of generating at least $1000 per square foot per year in sales - preferably more.  That means that if your space is 800 square feet, you need to be able to generate at least $800k per year in sales.

Second item is that you will need to have a unique concept - offering foods that are different from what is being currently offered.  You had not mentioned what your concept is.  Whatever it is, you will want it to be a compelling offer that is unique but that has wide appeal for the marketplace you will be entering into.

Third thing.  Experience.  If you have an existing restaurant or at least have strong management experience in a restaurant, this adds to your credibility with mall leasing management.  This experience will need to be in your business plan.

Fourth item.  Your menu.  Mall food court concepts perform best when the food is easy to order and easy to eat.  You need either handheld or highly portable foods that are at an affordable price point for guests.  Your ticket times need to be very, very fast - meaning that from the time guests place their order, they receive their foods in about three minutes or less.

Fifth item.  Your storefront.  The mall will most likely want an artist's rendering of what your storefront will look like.  From lighting to digital menu boards, the more eye-catching and attractive your food court space is, the more business you will generate.  It should be like a magnet for people - they should be drawn to your space out of curiosity at least.

We can help you with all of these items and more. You had already contacted me at my email address, dfoster@fosterandassociates.net and I am responding there as well.  Feel free to email me more information and I will be happy to schedule a no fee, no obligation phone call with you. If we both feel like it is a good fit for us to work with you, we will be happy to put together a proposal to help you with your concept, menu and lease negotiation.  Our fees are reasonable and we have a great deal of experience in this with malls all over the country.

I hope this helps and I look forward to hearing back from you!

David Foster
dfoster@fosterandassociates.net
(417) 877-0428 office
(417) 849-1903 cell  

Running a Restaurant

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David Foster

Expertise

We have been in the restaurant industry for over 40 years and consult with restaurants, casinos and hotels nationwide. We love helping restaurant operators succeed and can answer any questions related to restaurant start-ups, business plans, operations, labor costs, food costs, liquor costs, employee turnover, marketing etc.

Experience

I am a seasoned foodservice veteran with nearly 42 years experience in the industry. My extensive background includes overseeing multi-unit, multi-concept restaurant operations ranging from cafeterias to fine dining, and everything in between. I have a strong hands-on operations and marketing background that give me a unique insight into the “Real World” challenges of the restaurant industry. I have extensive concept development, menu and recipe development and kitchen layout and design expertise. I am effective in analyzing operational needs and identifying practical solutions in today’s very dynamic foodservice environment. In the industry, I am respected by my peers and have served on the Board of Directors of the Missouri Restaurant Association and have been a featured speaker on the subject of Home Meal Replacement at various national events. I also served on the Culinary Advisory Board of the Ozark Technical College as well as serving on the Board of Directors of Big Brothers, Big Sisters of the Ozarks.

Organizations
Member of the National Restaurant Association, Past Board Member of the Missouri Restaurant Association, Past Board Member of Big Brothers, Big Sisters of the Ozarks

Publications
The Consultant, Seasoned Views (a trade magazine for the restaurant industry)

Education/Credentials
Attended Drury College, Springfield, MO, Varsity Management, SRI

Awards and Honors
I have had restaurant projects featured in The Consultant (a magazine for foodservice consultants with worldwide circulation). I was honored for achieving the highest level of management competence by the Selection Research Institute.

Past/Present Clients
Sugar Creek Casino, Classic Rock Coffee Company, Mark Twain Brewing Company, Springfield Brewing Company, Bruegger's Bagels, M&M Grill, Paco Joe's, Holiday Inn, Hilton Garden Inn, Buffalo Run Casino, Golden Corral Corporation, Crosswinds Café, Chinese Chef, Mr. Dunderbak's Old World Market & Café, Bullfeather’s Wings and Grille, Mainstreet Market, Bear Rock Café, Cartoon's Oyster Bar & Grill, T's Redneck Roadhouse, Jim's Steakhouse, Neighbor's Mill Bakery & Café, Crazy Vine, San Francisco Oven, Maria's Mexican Restaurant, Andy's Frozen Custard, The Granite Club, Umi Japanese Steak, Seafood and Sushi, Springfield Grocer Company, US Foodservice, Premium Standard Farms, Smithfield, Dakota Organic, Kraft Foods, Allens, Inc.

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