Dornoff Consulting: July 2006

Monday, July 31, 2006

Business Articles of Note

New Tricks for Ticket Sellers

Motorola prepares plans for citywide Wi-Fi in Chicago

Ford to Put 600K Toy Cars in Cereal Boxes

Wireless router solution often a total disconnect

Getting the full picture

Manufacturers find reasons to cash in on organic market

Mom and the `magical picture frame'

At 60, Sony focuses on rebuilding brand, restructuring

Idaho leads nation in job growth

High price of health insurance has some companies looking at dropping coverage

Great Mall of Las Vegas will have 'hybrid' look

Exit Plan: Follow Nissan

GPS Unit Maker Finds Its Way in Crowded Market

Sun Brightens Colors, Profit at Laundromat

Men Not Working, and Not Wanting Just Any Job

Camera System Creates Sophisticated 3-D Effects

Newspapers to Use Links to Rivals on Web Sites

Billy Bragg’s MySpace Protest Movement

Sports’ Greatest Hits at One Web Site (but There’s a Catch)

AOL Plans Expansion of Videos on Portal

Entrepreneurship, self-employment thrive in Utah

Advertisers face TiVo challenge

Intel Core 2 Duo a big leap in chip race

Panguitch Drug Co. is a family tradition

Audience for news online starts to level

Ads offer new model for getting rich online

Casper Penney's gets make over

Thursday, July 27, 2006

Business Articles of Note

High-Tech Ear Gear for Cattle

Japan's electronics cos. may be reviving

NEW INTERNET IS THE STUFF OF DREAMS

Nano gives a big boost to run-of-the-mill jogging

Computer purchase plan gets little credit

Pension plan deal stalled in Congress

Utah's economy strong in first half

Chicago passes living-wage law

Google to report ad-click details

New Monopoly ditches cash, uses debit cards

Industrial space diminishing in Las Vegas

Future Indian casinos face restrictions

Broadband Lines Increase 33% in 2005

Here comes upscale farm fish

Snapvine gives voice to social networks

Changes at Netscape Foreshadow AOL's Evolution

Hot for Dots

Monday, July 24, 2006

Business Articles of Note

Vendors Cash In on Lewis and Clark

Fake Weed A Growth Business for Advocate

Kitchens Cater to Families on the Move

Digital jukebox tunes in on younger crowd

Parents supply and demand organic foods

Linux gains traction in software market

Untangling mess at desk can save time, add safety

Frozen treat's inventor tastes sweet success

Housing market, aging boomers help luxury flow into bathrooms

Entrepreneur in the electrons: Cyberspace offers online company exec room to create

Retailers See Trouble on Ports' Horizon

Small Theme Parks Still Riding High

The New King of Big TV’s Is Queen-Size

After Delving Into 33 Other Lines, Amazon Finally Gets Around to Food

Consumer Reports to Add Shopping Magazine

Sky-high gas prices spur companies to pay for bus

Who'd Want to Live There?

States hiking minimum wage

Thursday, July 20, 2006

Business Articles of Note

Amnesty: Web Companies Violating Rights

China's Karaoke Police Have a Request: Do It Mao's Way

Is it a game or an advertisement?

Wireless phones cheaper for rural areas, study says

Fed chief says housing slowdown appears 'orderly'

Fred Meyer Stores to open medical centers in Idaho

Looks are deceiving for a reason

California: Rent Increases in State Outpace Much of the West

There'll Be No Lighting Up at Marriott

Playing Matchmaker for Technology, With a Twist

Seagull gets a reprieve from Deseret Book

Engraver signs off in Seattle after 124 years

US Airways will sell ads on its barf bags

Retailers Seek Fee Rules From Credit Cards

Wednesday, July 19, 2006

Business Articles of Note

Gloves come off as Wal-Mart, critics slam each other on Web

Demand drives boat companies to go bigger

Judge overturns Wal-Mart health care law

Hotel industry gathers momentum in Southeast Washington DC

Verizon Overbills 11,000 Customers

Firms Aim at Business Networks

Woman seeking man mom will approve

No Corinthian leather, but sense of humor smooth

Burke trans fat plan to exempt small cafes in Chicago

Jones to sell products in Kmart stores

CEO says USDTV far from finished

Nortel deal cements Microsoft links to VoIP

Bookstore closing an 8-year chapter

Even if fans boycott, Starbucks won't suffer

Angie's List providing ratings in the Salt Lake area

Micron ranked 1st in patent quality

Classical Station Owner Sticks to Playing Solo

Real-Life Lessons in Student Contests

Branding Is Key Part of Firm's Marketing

Downloading Service to Allow Film Watching on TV Screens

Jobster lands $18 million for expansion

Tuesday, July 18, 2006

Sorry to my regular readers of Business Articles of Note, due to new network equipment being installed I will not get an issue out today but it will return tomorrow mid-afternoon. Sorry for the inconvenience.

Monday, July 17, 2006

Business Articles of Note

More buyers eye HDTV as price falls, levels off

A growing market for natural foods

Device helps parents control kids' `new media' time

Sparking interest in wireless networks

Capitalizing on a hobby could lead to business career

Online small firms go shopping on Net

Training efforts often insufficient, companies say

Kalispell, Montana: Makeover in full swing for popular Scotty's Bar

Novell to release new Suse Linux version, first since 2004

Web site lets you rate local businesses

For San Diego Real Estate, the Skies Are Not So Sunny

Do 'Social' Search Engines Have the Answers?

Bogus Clicks on Online Advertising Links Continue to Rise, Report Says

Alltel to End Local Service as a Spinoff Is Completed

How Far Would You Drive to Avoid a Rental-Car Tax?

Making Several Stops at Shops Online, but Paying All at Google

H.P. to Unveil Radio Chips to Store Data

Interactive Netscape Site Gets Some Sour Responses

News Online Seems to Have Long Shelf Life

Turning repairs into profit

Retail Notebook: Sexy fashions to celebrate, not mask, the life within

iPod repair a booming business

To save, power down at night

Bike sales cycling higher

Sunday, July 16, 2006

Finding the Right Retail Location Part 3

Finding the Right Location.

In the previous two entries on finding the right location, we talked about the different types of places that might be right for you and in part 2, we discussed in more detail finding the right location.

Now we will assume you know the type of business you want, and now you know in general the type of location that will work for you.

Suggestion: Do not be in the position that only one type place or location will work for you. You are putting yourself in a corner that in the long run could ruin your business or create major headaches for you.

There are three general types of ownership of centers. Since they pretty much have the advantages and disadvantages are basically the same, I will discuss those in general.

Locally Owned:

This is an easy one, as someone in the local community has ownership of the complex. This type of ownership is becoming none existent in today’s real estate market but there is still some out there.

Developer Owned:

The developer who originally built the facility still owns a majority interest in it. Some developers will hold onto shopping centers they build and other will sell them once they are done.

Real Estate Investment Trust (REIT):

Many shopping centers these days are owned by Real Estate investment trust. You can invest into some REITS on the stock market. There primary focus is to give dividends to their stockholders or partners.

Others:

There are other forms of ownership that a center may have but this gives you a general idea. Overall you will usually be dealing with a local management company rather than the actual owner anyway.

If you have followed my writing you will know what I am going to tell you to do next: that’s right research!! You can either do it yourself or pay a consultant like me to do it for you (but it will cost you and if your starting out do the research yourself).

Find several places that will fit your needs and do the following things:

Count the number of stores in the center. What is the percentage of national to local retailers? Watch traffic on a typical weekday, Saturday, and Sunday. I would also recommend you watch traffic at several different times of the day to see how it varies.

If there are other local tenants in the shopping center see how they get along with the landlord and how quickly he responds to issues. You can also check with some of the major tenants but often they will not have day to day dealings with the landlord only their corporate offices will.

Check how many vacancies the center has, and find out how long some of the stores have been empty. Are they filled fast or have some stores been empty for a couple of years?

If you have a business newspaper in your area, read it for a couple of months and know what is happening in the real estate area. Also read your local newspapers, which like the business journals will have information on new developments, so you can see where the trends are going.

Now that you have done your homework, you have found a couple of shopping centers that will work for you (the more that will work the better), now you will contact the leasing agent and work out deal to rent a place. As I mentioned in my rundown of types of centers, there are some centers that will not want you because you are not a national retailer, however if you have done the homework, you will have general idea of who will want the local retailers.

A couple of things to look out for: If the leasing manager is too eager to have you rent or doesn’t seem to care if they rent to you or not.

If the leasing agent seems desperate you be warned. There might be something happening that you do not know about. The center could be up for sale and once it is sold your out the door as a local retailer, or the leasing agent knows a new center is going in down the road that is going to steal traffic and hard the business in the center. However, you can lower this problem by studying what is happening in the area and reading the newspaper and trade journal.

The next area of concern is if the agent doesn’t seem to care if you lease space in their complex or not. Once again by doing research you should be able to eliminate some of the potential problem centers but not all. If the agent doesn’t care if you lease or not, what will happen if there is a problem? Will he be there to fix it? Sadly there are some owners who just don’t care or are trying to milk a center. I worked for one company (a Fortune 100 Company) that was told by the manager of a REIT owned shopping center that he could care less if we where a tenant or not, and if we could just move out because he could care less if we where there (many of the tenants had moved to a new shopping center that was built a couple of miles away and this one was fading fast).

Be sure to ask the leasing agent many questions and see how he answers such as:

What kind of response time can I expect if there is a problem with the building such as roof leaks?
What kind of upgrades are you planning over the next year?
Is there any pending litigation involving my building (I was involved in a incident where the county allowed the developer to build a wall for a tenant and the neighbors behind filed a lawsuit. Several years later the neighbors won the suit but the developer had sold out to a REIT, a city had annexed the area, and the original tenant had closed. The new tenant is now being forced to move to another location to satisfy the lawsuit even though they where not involved but they where in the building).

Before signing the lease I would also recommend you take the lease to an attorney to look it over. Always cover your back; the property owner will have plenty of attorney’s watching their backs so make sure you have an attorney look everything over. It is worth the cost over having issues in the long run.

It seems like a lot of work but your goal is to build a successful business so the work will pay off. But once the lease is signed then the real fun begins….

This is by no means a complex list of what to do. It is trying to give you a start into the wonderful world of retailing/running a business. Read more and continue looking at this blog for more ideas and articles that may be of interest.

Thursday, July 13, 2006

Business Articles of Note

Wendy's spices up chicken sandwich

News Corp. Launches Online Safety Campaign

Most beef plants don't bother with exports

Major Cuts at Disney Are Expected

Phone customers rank cable plans high

Consolidation aids department stores

Web start-up offers free digital storage

Southwest to Begin Flights From Dulles

Snowbird expansion plans worry Alta officials

Small-business lenders receive 2006 awards

Microsoft, Yahoo to begin testing on instant messaging

Boise firm drops online groceries

LDS bookstore cuts competitor's supply

Deal Is Seen for Creating Urban Films

A Mall Strives to Fit In With Its Neighborhood

Wal-Mart Loses Appeal to High Court

Wednesday, July 12, 2006

Business Articles of Note

Home foreclosures rise in Denver

Wal-Mart discusses global warming steps

Citgo to stop selling gas to U.S. stations

'Obsessed' bag ladies

Sports radio rivalry heats up

McDonald's chickens out

Comcast offers bundled service for $99 a month

Wal-Mart's New Jersey ATM sparks cries of foul from wary banks

Balducci's Reconsiders Store in Penn Quarter

$550 million set for downtown Chicago

Workforce Housing Proposal In Maryland Passes

Chicago's Big-box wage plan may face suit

A new low for network television

Spokane initiative: Better pay for "big box" workers

Eddie Bauer to return to its heritage

CleanFlicks stores plan for the worst

E-mail service provides up-to-date tax information

Chinese Company Intends to Build MG’s in Oklahoma

Recovering From Financial Turmoil

Mother of Invention Inspires Studio for Kids

Getting the Legal Papers for Start-Up

Tuesday, July 11, 2006

Business Articles of Note

Songwriter utilizes EBay to get noticed Cubicle confidential

Illinois-Highland Park now has hot spots

Chicago-Next flood downtown will be of office space

Six-Figure Fines For Four-Letter Words Worry Broadcasters

Response mixed to Southwest seating test

Retailer agrees to pay $150,000 to settle disabilities act lawsuit

Seattle Area-Downtown Bellevue has high appeal

West Coast climate change could threaten wine production, study suggests

Barrier to Wal-Mart bank?

Gene Juarez sells salons, but his vision still remains

Startup that's still incognito gets $6.5 million

Wal-Mart rumors have Moab on offensive

Boise company wins kudos for creative use of recycled space

India Stops Privatization, Casting Doubt on Reforms

Celebrity Merchandising Aims at the Young

Monday, July 10, 2006

Business Articles of Note

China's trade surplus hits record in June

Telemarkets won't be calling cell phones

French twist in Michigan Avenue display

Potato cafe to butter up D.C.

SunRocket to Unveil Global Calling Plan

Entrepreneurs with questions can check out answers at the library

A Little Town To Call His Own

Powered up

Affordable citywide Wi-Fi experiment launched nationwide

The Insider: The award for Goofy Press Kit goes to ...

Unsnarling the tie-ups of travel

Bringing Gen Y Aboard for the Long Haul

Go online anywhere with cellular broadband

Firm Hopes Old Brand Will Spell Success

Online Movie Tickets a Still-Evolving Force

Old Media, Not New, Is World Cup Winner

Dell's Exploding Computer and Other Image Problems

Old Media, Not New, Is World Cup Winner

Sale Shoppers Annoy Grocers as They Save

At AOL, a Plan for a Clean Break

Wednesday, July 05, 2006

Business Articles of Note

Manufacturers eye luxury bathroom market

Southwest Airlines raises fares

Dracula amusement park plan dropped

Angry Customers Use Web to Shame Firms

Amazon.com to sell own toy, baby items

Choice Organic Teas steeped in principles

Q & A: REI's billion-dollar CEO

Internet driving down phone costs

Smiley Face Is Serious to Company

Ban on Wild Caviar Is a Boon to California Sturgeon Farms

Firm Stitches Right Words for Growth

Getting to the Top of Online Searches

Employees Sue Railroad Over Social Security Number Theft

Business Articles of Note

Monday, July 03, 2006

Business Articles of Note

Shoe retailer Payless putting its best foot forward

Move is afoot to block industrial banks Keeping

Boomers on the job with a few concessions

Buyers zoom in as digital SLR prices fall

Spanish-Language Radio's Big Voice

Entrepreneurship education pushed

Broad Experience For a Tall Job: A Hipper CNBC

Working retirees favor flexibility over running the place

InfoSpace targets wireless delivery

Nokia tests retail waters with its flagship stores

Closure looms for N.J. casinos

Web site helps you keep track of goals

Switch between the new and old

Mexico's broadband boom compounds piracy

Internet Calling Pressures Bells to Lower Rates

A Search Engine That's Becoming an Inventor

L.A. Up to No. 16 in Business Costs

Finding the Right Retail Location Part 2

This is designed to give the new retail and/or on-line business the general idea of possible locations for a store. This is designed to give a brief overview but each situation and each area is different and you need to find the right spot for your business by researching your area.

Here are the basic types of locations with some advantages, disadvantages, and general comments:

Large/Regional/Malls:

OK, almost everyone has been to a mall at one time or another. Most have anywhere from 500,000 to 1.5 million square feet of retail stores. Until the last few years, most have been enclosed.

Advantages:

Lots of Foot Traffic
Major Retailers to Draw Customers in

Disadvantages:

May draw in the wrong type of Client for your store
High Rents
Your store may not be wanted

General Comments:

For most new retail stores, the mall is not the place to be. While it may be attractive because of the foot traffic, the cost of getting the foot traffic is most likely not worth it. In addition many large malls do not want local retailers because they don’t “draw enough” people. Usually the malls that welcome local retailers are the ones who are on their deathbeds or having other troubles.

Also, a fact that many people don’t know is that the smaller stores in the mall subsidize the rent for the department stores. Often stores such as Nordstrom’s and others pay very little or no rent which means that you make up for it. (The thought is that you benefit enough from the traffic they bring in for you to pay it).

The other thought to consider is that many malls are not as attractive for stores as they where even 10 years ago with fierce competition from lifestyle and other types of malls.

Power Centers:

Power centers are a smaller than mainline malls but bigger than strip centers. Usually they include one or more big box retailers such as Wal-Mart, Target, Home Depot, Lowe’s, or many others. They usually are not enclosed and all the retail stores all have outside entrances.

Advantages:

Main attract good foot traffic
Less expensive than Malls

Disadvantages:

Wrong type of traffic
Cost
Market may be wrong

General Comments:

While located in a power center will be less expensive than the mall, it could still be out of the price range of many new retailers. Also, you need to research and see if the power center has the right mix of retailers to draw customers into your store. If you’re an upper class store a Wal-Mart or a Super Saver Grocery Store is probably not the right type of neighbors to have.

Strip Centers:

Strip Centers are the next step down from a power center. They can be anywhere from a two or three stores up to 10 or many. Some will have a major grocery store in them but many will not.

Advantages:

Cost

Disadvantages:

May not have enough foot traffic

General Comments:

Like all the choices, you must make sure you do enough research to ensure that you are finding the right location for you. Who are the other tenants? Are they going to attract the right customer that will also shop in your store? What are the demographics of the shopping center and are they compatible with yours? Just because a place may be cheaper, make sure that you are not being penny wise and pound-foolish.

Lifestyle Centers:

Lifestyle centers are a relatively new creation in retailing in the last few years. They are opening air centers that are designed to give a more “Main Street” shopping experience. They are Hybrid centers coming out which are basically malls that are now taking their roofs off and others that are built with housing components.

Advantages:

Foot Traffic
More Smaller Stores

Disadvantages:

Once again many centers don’t want the local retailers
Cost

General Comments:

You would think with the “Main Street” feel that the developers of lifestyle centers are trying to create, you would think that they would be more open to smaller local retailers but once again many are unfriendly to them.

You do have the advantage of better foot traffic than most strip centers but you must weigh whether the cost is worth it for the customer you are trying to attract.

Sorry to sound like a broken record but research, research, research.

Factory Outlet Malls:

The Factory Outlet Centers usually include stores than represent different manufacturers, which can either be like a showroom, or a place to sell outdated and discontinued merchandise.

Advantages:

Foot Traffic
Cost

Disadvantages:

Foot Traffic
Store may not be wanted

General Comments:

While Factory Outlet Stores had a surge in popularity in the mid-90’s, they have quickly faded. The centers that seem to be doing well are the ones located primarily in tourist areas such as Park City, Utah; Lincoln City, Oregon and Las Vegas.

Once again you may run into the situation where the mall managers may not want your business in their center but for a different reason that most of the others. In some cases stores where told that because they where not owned by a manufacturer that they where not wanted in the center. However, with some selling you might overcome this obstacle.

As in the case of all locations, you will want to research to see how well the center your looking to locate in is doing. Like stated above, they seem to be dying in non-tourist oriented places. Once of the causes of the downfall is that some retailers have signed agreements with one of the big boxes that states they will not sell anything for a lower price than the big box has it.

Transit Oriented Development:

Transit Oriented Developments are centers located at a major transportation station: Light Rail, Commuter Rail, etc. They are designed for commuters and people living near the station in order to reduce car trips.

Advantages:

Located at a major transportation port
Good foot access
Nearby Residential

Disadvantages:

Cost

General Comments:

Transit Oriented Development (TOD) can take many shapes and forms. If they are being developed right, not only will you have the transit riders coming through the area you should also have a good selection of residential neighborhoods in the area in order to attract traffic during non-peak travel periods.

As I keep on saying, you need to do the proper research in order to insure that the center will attract the right type of customer to your store. Many different kinds of retailers can work in a TOD but each one is different.

Office/Warehouse Space:

This is the type of facility that you find in more industrial areas of the city. They usually have a small office/showroom facility in the front with warehouse space in the back with a large door.

Advantages:

Cost
Warehouse Space

Disadvantages:

Location
Foot Traffic

If a major part of your business is going to be online, you may want to consider this type of facility. It will give you more room to store your merchandise but still offer you room to have a showroom or displays in the front plus some office space.

This option is less expensive so if your are not depending on foot traffic, this could be an excellent alternative for your business.

Conclusion:

I hope you found this to be helpful in your search to create your successful business. Next week I will go over what you should be looking for in mall management and some of the warning signs you should look for before you sign your lease.

John Dornoff
Dornoff Consulting Group
info@dornoffconsulting.com

Monday, July 31, 2006

Thursday, July 27, 2006

Wednesday, July 26, 2006

Tuesday, July 25, 2006

Monday, July 24, 2006

Thursday, July 20, 2006

Wednesday, July 19, 2006

Tuesday, July 18, 2006

Monday, July 17, 2006

Sunday, July 16, 2006

Friday, July 14, 2006

Thursday, July 13, 2006

Wednesday, July 12, 2006

Tuesday, July 11, 2006

Monday, July 10, 2006

Friday, July 07, 2006

Thursday, July 06, 2006

Wednesday, July 05, 2006

Tuesday, July 04, 2006

Monday, July 03, 2006

Sunday, July 02, 2006

Saturday, July 01, 2006