From the February 2003 issue of Startups

Congratulations! After much soul-searching, you've finally chosen your dream kiosk-based enterprise; now's the time to start getting down to business. But where are you going to put your kiosk? What do you need to consider? "It starts with identifying who the target customer is. You want to locate close to where those customers are," says Howard Van Auken, academic director for the Pappajohn Center for Entrepreneurship at Iowa State University in Ames.

Thinking about the target customer worked for Diane Flannery, CEO of Juma Ventures, a San Francisco organization that finds employment for inner-city kids, and a Ben & Jerry's franchisee. "When we started eight years ago, we were trying to find different venues where we could sell ice cream," she says. "We figured young people love baseball and ice cream, so the ballpark seemed like a good fit."

Once you've found your target customers, Van Auken says, "Visit the areas and see what the traffic pattern is. In addition, he suggests considering security, operating costs, cash flow, staffing, display issues and lease length. The leasing manager for the shopping center you're interested in can help with these questions.

Susie Grant, specialty leasing manager for the Galleria at South Bay in Redondo Beach, California, has a list of questions to consider:

  • Are target customers shopping at stores near your desired location?
  • What type of storage is available? While the Galleria's kiosks do have some storage space, tenants can buy more at an additional charge.
  • Do you plan on leasing during the holidays? Rent goes up considerably during that time.
  • How long a lease do you want to sign? Grant offers agreements that last anywhere from a month to a year.

After you've balanced out cost issues, found great staffers, decided on lease length and gotten product approval from the shopping center, it's time to set a move-in date. "[Location] is always based on availability," Grant says. "[Kiosk owners] may have something in mind that's not available at the time they're coming into the mall."

While considering all these issues, one of the smartest things you can do is trust your instincts. "Go with your gut," Grant says. "If you have a good feeling about a location, it's probably going to be a pretty good place for you to start."

GRAND SLAM
Since 1994, San Francisco youth development organization Juma Ventures has operated inline Ben & Jerry's Scoop Shops in addition to kiosks at 3Com Park, home of the San Francisco 49ers, and Pacific Bell Park, home of the San Francisco Giants. The franchise serves ice cream at all home games for the football and baseball teams (though chilly evenings during football season do impact sales), and at special events such as the Rolling Stones concerts in November 2002.

Running stadium kiosks provides challenges that Juma doesn't experience in its inline stores, particularly when it comes to staffing during baseball season. "Most Friday evening games start at 7:35 and end around 10," says Travis Marshall, general manager of the enterprise, which employs teens between 14 and 15 years old. "Then 99 times out of 100, Saturday games [start] between 12 and 1 [p.m.], which means you have to be back the next morning at 9. There's a lot of coordination with that, making sure the kids don't work overtime, etc."

Juma admits its mission to find employment for inner-city kids helped get the contract, but CEO Diane Flannery sees opportunities for other kiosk franchisees in similar nontraditional venues. "It's important to watch where in your community you can set up these kiosks," she says. "We watch big events, then figure out how to get into them. We're in touch with the entertainment around the San Francisco Bay area, and that's something most franchisees could do easily."