Pioneering the growth of leading concession businesses in garden centres
Concession is the term that describes a business trading under a contract from a concession stand or area within the premises of another business, or host. A concession is principally a tenant and the host is its landlord. Concessions are usually given a degree of exclusivity by its host to allow it the right to retail certain product ranges. Concessions operate under their own branding and heads of terms are negotiated and agreed prior to a solicitor drafting either a licence or lease which describes the principles terms under which the parties will operate.
Concession rents are usually agreed in a variety of forms to suit the parties; fixed base rents, turnover rents, commission structures or a mixture of the three. Rent reviews are set at certain points during the term and can be linked to RPI, CPI, fixed rent reviews, or open market rents reviews. Service charges, marketing charges and other operating costs are sometimes paid in addition to rents.
Lease terms are agreed to suit the needs of landlord and tenant but concessions usually trade for a period ranging from 3 years to 10 years, with break clauses set at suitable points. Licences are usually for shorter periods and used mainly for concessions that can be relocated at any time, i.e. a short term concessions using small areas of promotional space. Licences usually include shorter break options compared to lease agreements.
Concessions have helped garden centres blossom into multi-million-pound retail hubs and become serious shopping destinations. The term retail concessions covers numerous retail sectors from the traditional aquatic, pets, conservatories, turf supplies and landscaping to the lifestyle retailers offering kitchen ware, fashion, bikes, camping, bathrooms, furniture, lighting, farm shops and groceries.
Other retailers take the opportunity to generate leads from garden centres by setting up a concession stand in small areas by till points or high traffic locations. These promoters use promotional space or exhibition areas to target consumers directly and car companies have found that garden centres are ideal ways to grab the attention of visitors by establishing prominent displays in busy car parksil concession market, and these shops have widened the appeal of garden centres for families and created extra reasons for more customers to visit.
First Franchise has assisted many of the UK’s leading retailers take their first step into this new and exciting reta more often.
First Franchise are pleased to introduce the latest success story for garden centres, Unmanned Concessions. A profitable, low risk way of introducing new product types and brands, unmanned concessions are an excellent way of adding complementary ranges to the site with minimal outlay.
The Concept Explained
Unmanned concessions are based on the department store model of concessions. Complementary premium branded retailers introduce their ranges to garden centres and the sales are processed through the garden centres tills.
The display material (i.e. fittings and Point of Sale) is provided to the garden centre free of charge and more importantly so is the stock. Garden Centres find a suitable area of retail space, (usually no more than 300sqft) for the incoming retailer so that they can set up their branded area. In the meantime the product files are given to the garden centres and are loaded onto the EPOS systems to process sales and so that stock levels can be managed whilst they are trading from the site.
As a customer picks up an item from the on site merchandised units, they are paid for at the garden centre tills. The site then handles the money and is invoiced by the concession for the amount minus an agreed commission value. Therefore, garden centres are able to introduce the retailer’s ranges to their customer base at a very low risk as they do not have any outlay on stock.
Stock re-ordering and replenishment is all managed through the EPOS system and delivered directly to the garden centre. Garden centre staff will support with maintaining standards on a daily basis, with support from the retailers merchandising teams. A full planogram on how to maximise the visual impact of the display areas is provided.
In addition to the recognised brands that First Franchise can introduce to the garden centre, they also have associations with suppliers of EPOS till systems and merchandising companies to ensure that the product is always maintained and serviced to the highest standard.
Due to the knowledge and expertise First Franchise have gained in placing manned concessions into the garden centre sector, they have been able to put together an ever increasing portfolio of brands that have been selected especially for garden centres throughout the UK.
Yankee Candles have recently installed into over 120 garden centres within The Garden Centre Group and have enjoyed excellent sales success and an improved working relationship. They are looking for new sites and can work with garden centres to convert existing arrangements to the concession model.
The House Nameplate Company have installed into 120 garden centres nationwide. They have a model which is based on a purpose built display unit which starts from 1m² and can increase to a stand of 2.5m wide by 2m tall. Within this display they have door names, letters, numbers and furniture and even pet signs. An excellent addition to an established garden centre line, within this display area House Nameplates also offer their unique, bespoke nameplate service.
Villeroy & Boch (NEW!) are one of the world’s leading and most recognisable ceramics manufacturers. They have a range specifically suited for garden centres of kitchen and homewares that can fit into areas from 250sqft. This high end ceramics offer adds a point of difference to the garden centre and serves to upgrade their gift department.
The Clothing Outlet (NEW!) clothing offer for the children! Capitalise on family days out by introducing The Clothing Outlet to your garden centre. With tailor made children’s ranges ideally suited for the garden centre customer, the clothing outlet look for areas of 200sqft – 400sqft to install their range of popular character branded clothing.
Hippobag (NEW!) an excellent alternative to skip hire, Hippobag provide an easy to use rubbish removal system that allows customers to manage their garden projects and remove waste by offering bags in a variety of sizes to suit any project. The bags can be purchased direct from display stands installed into the garden centre from as little as 1m² display area and customers can then call direct to have the waste collected.
If you are reading this from a garden centre or if you are a retailer or manufacturer looking to find out more about Unmanned Concessions please contact First Franchise. Sue Franks is our expert and can be contacted on 01737 735041 or firstname.lastname@example.org
We look forward to hearing from you.
- New ranges installed with no outlay on stock
- Excellent, established brands available to be introduced
- Display material and POS installed free of charge
- Merchandised areas in prominent areas to maximise sales
- Areas required from 1m² up to 500sqft
- Sales and stock managed through the EPOS till system
- Commission’s payable after money has been taken for product through the tills
- Commission levels available between 25% – 35%