Pop goes the start-up

With consumers rushing online to purchase their goods and services, it may seem counterintuitive to add a physical presence to your business if you’re a web start-up.

 

But that is exactly what many small businesses are doing in the form of pop-up shops. And the results should give encouragement to those struggling to generate both sales and profile.

 

What are pop-up shops? They are temporary retail outlets that spring up almost anywhere – shopping centres, within other stores, out in open public spaces – for a few days, weeks or months.

 

While Australians are spending $11.3 billion a year online and growing – and physical stores’ sales are sluggish – pop-up shops are bucking the trend.

 

A recent report by Commercial Real Estate Agents found that vacancy rates in Melbourne’s top 10 retail strips fell to 3.5% over the second half of last year, driven by the rise in temporary outlets.

 

 

The trend is catching on in Sydney too, with US fast food chain In-N-Out Burger opening up in Potts Point restaurant Barrio Chino for a matter of hours. The queues were so long that many people didn’t get served.

 

“I think pretty much any kind of small business can use pop-up shops, as long as they are offering something different and interesting to consumers,” says Debra Templar, founder of the Templar Group consultancy.

 

“Cafes are doing it, so are vintage shops and head and shoulder massage places. It’s all about the people and PR, rather than just the type of business you are.”

 

“I think we’re seeing this kind of outlet grow because lots of businesses can’t afford the rents that are now being charged.”

 

“Rents are rocketing up and with pop-up shops you can test out a concept without locking yourself into a long, expensive lease.”

 

While this growth is helping businesses keen to get into retail strips and shopping centres, it is also aiding start-ups that didn’t initially start with the idea of having a physical sales presence.

 

 

“Pop-up stores are seamless for online businesses – I know of a business owner who sets up a store once a month in a design studio and she just sells online the rest of the time,” says Templar.

 

“Businesses such as Sterling & Hyde and Perfect Pieces Jewellery have found that it is perfect for their start-up model – they can test concepts, expose themselves to new markets or shift old stock.”

 

“The challenge for a lot of them is broadcasting their message. TopShop has great pop-up shops, but then, they have the money to set them up and market them.”

 

“It depends a lot on whether you have a database or not. If you don’t, you need to do handouts, social media such as Facebook, posters and so on. Still, it can be very cost effective.”

 

As more temporary stores appear, an industry is starting to grow around it. Scott Williams was working in exhibitions when he realised that there was a gap in the market to service the pop-up shop sector.