For entrepreneurs contemplating starting a small business, or expanding into a new product line, carts and kiosks are an option worth exploring. Compared to the costs of establishing a fixed retail location, the investment required for this type of sales venue is considerably less and does not require a lengthy license agreement.
Shopping malls typically have at least one central pedestrian spine that is a main thoroughfare for shoppers, and they are popular sites for a temporary business operation, however many vendors are also finding success in airports and fairs as well. By conducting a little research and creating a business plan, kiosk retailers are enjoying robust sales of all kinds of products, including customized sports team prints, personalized stainless steel rings and remote control toys.
Personalized products are a big trend this year, and Name in the Frame allows consumers to, literally, name-drop their favorite sports teams. A customer simply supplies the name of the person who will receive the print, and the vendor uses a computer printer to insert it into the chosen major league team color photo, making the recipient part of the team. In less than three minutes, the framed product is ready.
“It’s fun art,” says Jon Hart, chief personalization officer of the company, “and we have more than 1,000 pictures from which to choose.” Retailers have access to a virtual inventory that includes every NFL, MLB and NHL team available, plus a growing list of colleges and other licensed pieces, like NASCAR. There are several images from which to choose for each team. If a consumer is buying a gift for a Green Bay Packers’ fan, for example, he or she can choose from six prints, including kid friendly, pub and stadium versions. Name in the Frame offers both a standard black frame and a Windsor mahogany frame, each of which includes a matte style finish within the picture frame.
Good margins, low risk
Name in the Frame’s customized prints offer margins as high as three to four times markup, Hart shares. A 13 by 16-inch framed sports print, for example, retails for $70 to $100, depending on both the market and the frame, and wholesale is around $20. Kiosk startup costs are around $1,200 for a printer, image credits, paper and picture frames. “The genius behind it all is the technology that allows retailers the same markup they are accustomed to realizing from sales of other items, but without the traditional inventory risks,” Hart stresses. Retailers only keep paper and frames in stock. The company asks for a minimum order of three boxes, which totals 72 frames, and, “a good operator will go through 100 prints in a weekend,” Hart points out.
Women 30 to 60 years old are the targeted consumers, because they buy the bulk of gifts for family and friends, Hart asserts, and Name in the Frame is easy to sell, by offering shoppers a peek at a personalized print. “Previews drive sales, so it’s important that vendors have fun with shoppers,” Hart recommends. “They have to get people’s attention and enter into a dialogue.” Retailers must convey that they have every team, as well as other themes, and that the framed, personalized picture is available immediately. “They should ask people who they are shopping for, and what he or she is like. If they are not a sports fan, we offer other themes, too, such as wedding, relationship and children’s images.”
While mall kiosks are popular venues for Name in the Frame sales, the products also sell well at fairs and festivals. “The beauty of craft fairs is that they end, and consumers who see something they like are going to buy it on the spot because they won’t have the opportunity to go back.” Whether starting out at a mall or craft fair, it’s important to, “get your pitch down,” Hart stresses. “Focus on marketing and on how to engage your customers.”
Personalized rings, countless options
Like personalized sports prints, stamped stainless steel rings from Sun Fashion Designs, Inc., are fast becoming popular among kiosk vendors. The rings, made of 316-grade stainless steel, are hypoallergenic and can be completely customized with name, anniversary date, organization, sports team, symbol and more. “You name it, and we have it,” says Brian Nelson, sales manager of Sun Fashion Designs.
The startup kit, which wholesales for $865, includes the stamping machine, 100 rings, letters A through Z, numbers zero through nine, several punctuation stamps, a hammer and a paint pen, everything needed to create 100 personalized rings. Presently, 24 ring styles are available. Rings wholesale for under $1.85 apiece and retail for $30 and up. “We have some vendors selling these rings at upscale malls for up to $60,” Nelson asserts. “When we get phone calls from our customers they are buying a lot of replacement rings and they are so happy. They are overwhelmed with sales.”
Marketing materials are included with the kit along with tips of the trade. “We include many ideas for vendors,” Nelson points out. For example, the company reveals how vendors can craft the “Rainbow Ring,” one of the company’s most popular styles. Vendors also receive an instruction manual and video with step-by-step instructions on how to operate the stamping machine. It is incredibly easy to use, Nelson stresses, and it takes less than one minute to personalize a ring for the customer. The product is so new, he continues, that less than two percent of malls presently carry it, and the market is wide open for sales.
Remote control toys attract shoppers
Along with personalized products, remote control helicopters hit the mark when it comes to kiosk sales, and Valors Inc. has been committed to selling high-quality R/C helicopters, as well as cars, since 2007. Hank Ho, sales and service manager of Valors, says R/C helicopters are a staple at kiosks because they are easy to operate and demonstrate, and shoppers love them. Ho suggests vendors offer a mix of products, and while many retailers devote entire carts to R/C helicopters, others are diversifying. “Some vendors who carry our helicopters also carry other products, or they’ll have a neighboring cart that carries something else.” In addition, vendors should offer a variety of price points, rather than competing on price alone, to get the best profit margins. “Small helicopters are very popular because they are durable and affordable at around $45 retail. The large is a solid item overall that is easy to control, it sells and attracts attention.”
For vendors in the beginning stages of selling at a kiosk, Valors’ standard R/C helicopter package includes five boxes: two small, one medium and two large. Generally, there are 18 to 24 small helicopters per box and one piece wholesales for $14; there are 12 medium pieces per case and each one wholesales for $24; and there are four large pieces per case, which wholesale for $40 per piece. The standard package wholesales for around $1,400, and markup is generally three times. Larger helicopters, however, wholesale for around $70 and can retail for as much as $300.
Valors also offers a package that includes either newer items or those that are more resistant to online competition. Beyond that, for vendors who have multiple carts or are thinking of becoming distributors, Valors offers large discounts, Ho states. The company gives vendors the option to purchase individual styles as well, and prefers a minimum order of one case or $300. To support sales, Valors has large, five-foot tall posters, which are free with the purchase of a pallet or can be bought for $8 with smaller orders.
To sell Valors’ remote control products, Ho recommends that vendors first learn and follow the mall or fair rules. “Then, pick one or two large items and either place them prominently in front of the cart or hang them from above. That draws people in and they have no question about what you are selling. And always demo the small helicopters. Vendors look like they know their business when they demo the small ones.”
Furthermore, Ho says that a retailer getting into this business needs to be a bit of a tinkerer or know someone who is because oftentimes problems customers encounter are very easily resolved. “It could be something as simple as tightening a screw or unplugging and plugging back in the cable. It is really easy to sell these products but you have to be prepared with after service. Vendors need to play with the products to get to know them inside and out. That’s true with any item. If you don’t have a passion for a product and you can’t convince yourself to buy it, you aren’t going to be able to convince anyone else.”
Market research pays off
Finally, Ho suggests that retailers research marketplaces to find the most cost effective approach to selling their products. Kiosk rentals vary greatly by season, location and length of contract. In one Texas mall, for example, vendors pay as much as $15,000 a month starting in mid-October for the holiday season, and the rest of the year the cost is around $6,000 per month.
Carts and kiosks offer retailers the opportunity to operate lucrative shops in locations of their choosing, for the length of time that suits their products, as temporary stores also work well for seasonal businesses. Overall strategies critical to retail success include selling merchandise about which you are passionate, as well as knowledgeable, in a venue where you know, and can speak to your clientele, and perfecting a pitch that resonates with customers.
WHERE TO BUY
Name in the Frame
Tel.: 216-269-0272 (Dawn) or 719-494-8156 (Jon)
Sun Fashion Designs, Inc.
3220 Tower Drive
Prescott, AZ 86301
Toll Free: 800-398-7802
Valors Inc.
7458 Harwin Drive
Houston, TX 77036
Tel.: 713-781-1500
Fax: 713-781-1537
Website: Visit Valors Inc.