Opinion on Wireless Kiosk

[iwillescape.com]

I am considering becoming an authorized dealer for AT&T and T-mobile. I want to open up a kiosk inside one of the local malls. I plan to keep overhead low by keeping employees to a minimum and have a partner.

From what I've been told, start up costs are low. I have never started a business before and I'm 22 years old. I did not go to business school. I figure that it's a low cost type of franchise and a good place to cut my teeth and learn how to start a company. I would do it for about 1-3 years before splitting from my partner and opening a new store.

Has anyone done this before? If so, what were the glitches along the way? Were you successful?

ANY feedback or advice would be much appreciated.

[JLeezer]

I have not done wireless sales before, however, I have been involved in some mall kiosk businesses. The biggest thing to watch out for is the terms of the kiosk rental agreement. If the rent is too high, the lease lasts too long, or you get gouged too much for the Christmas season, that could bring you to a quick halt. Keep in mind though, that malls are fairly consistently priced based on the foot traffic that will be passing by your stand.

[warrensway]

Yes I would just worry about the lease agreement as well.

[jasaunders]

My question is, why this business? What is it about a wireless kiosk that you think is a good idea? Have you crunched any numbers to determine that this is a good investment? Have you talked to other franchisees who have had good experiences? Or do you just think this would be an interesting job?

[iwillescape.com]

The reason is, everyone has a cell phone, everyone changes their plans from time to time and there are always people turning 18 who want their own. It's like selling bottled water. There's tons of competition, but the market is huge.

Right now I work for a bank, if I work my as hard as I can work, 8 hours a day, I will make 40-45k a year. This includes working saturdays, staying late, getting their early, and being under pressure all of the time.

If I owned a wireless store, I have looked into it and the company pays about 250 for every new 2 year contract signed and 170 for every upgrade.

I took my salary + average bonuses for the past 2 years + the cost of renting the location / $250 dollars per sale / 365 days a year. I would have to make 0.56 sales per day to make the same amount of money I earn now, plus rent for the location. Currently I am required to make a minimum of 3 checking account sales per day. I think in a crowded mall, I could manage to sell 1 phone and contract per day at a minimum. In addition to that I would not have the stress of throwing on a suit and dealing with other people's financial problems.

As an example, I have a guy in foreclosure who needs help. He has asked me to write letters for him, make phone calls, has given me the details on his arrests, his messy divorce, his job problems and continues to call me even though I've ignored his calls for the past few days. He calls 2-3 times a day!

I live in Nor Cal, where the economy has pretty much gone to pot. The bank I work for is putting huge pressure on us to keep our credit portfolio alive, white simultaneously restricting the lending underwriting guidelines. So they've essentially shut off the faucet and then continue to advertise that they're thirsty. Equity lines are gone, can't sell em, can't get em through when I do. Refinances are a joke, and purchases require 10% down payment at a minimum. They're telling us if we don't perform we're out. I can't deal with that kind of pressure any more.

I just want to throw on a polo shirt and some khakis, hang out at the mall, drink some coffee, not worry about getting up until 9 or 10 and opening up at 11 or 12 and take off when I feel like getting the hell out of there.

I could hire some attractive kids that work at Abercrombie and pay them $1 more an hour and commission to walk through the mall and get business. Eventually I'd open up 2 or 3 sell it to a guy and allow him to make payments to me and escape.

The main reason for opening it though is that I am 100% entrepreneur but have no technical ability to start my own company. Since I was a kid I've generated hundreds of business ideas. I started my first business last year at the age of 21. I had no capital so I gave the idea to my parents, and though I am a "managing partner" the title is in name only. From that business I have another related idea but have no idea on how to actually start a business from scratch. The wireless kiosk is to simply CUT MY TEETH on something. I think it would be low risk as the costs are low, you receive training from the company, support as well, and it would allow me the opportunity to be in control, to call the shots, to hire and fire people and learn the territory. Once I escape from the mall kiosk I would launch the other 3 businesses I have, with more experience and knowledge.

[ljo1993]

It sounds like a great idea.

Best Of Luck

Ljo1993

[stand856]

I would have to say that you need to work at one first to get experience and not jump into something you have no idea about. Work for a cell phone store for a 6 months, get some experience and see if it can truly work for you.

[iwillescape.com]

I've worked in a similar environment for 4.5 years. I think I can handle that part of it.

[tazman9r]

As stated above, just be very careful for the lease agreement. Read all the fine print, with a lawyer. Simon Malls and Westfield, the two major names you'll be dealing with, will want to write the lease to maximize what they can get out of you. Also, since these are major corporate names, you won't get any "ma and pa" type breaks or understanding if you've come up short. However, I have heard that cell phone kiosks can be cash cows. There is just very large overhead wrapped up in the rent, whatever percentage of sales you agree to pay on top of the rent (don't be surprised if you get hit with that), and inventory.

Also, make sure you understand the operating rules, because otherwise security will be all over you. I worked for IPC at a Simon Mall in SoCal, and we were always keeping the cell phone kiosks and Dead Sea Skin Care guys in check.

[Aletheides]

You're thinking of starting a business selling cellphones and you've never sold cellphones before?

There's a huge difference between a good cellphone salesman and a bad salesman, right? It's definitely not just "hanging out in the mall and drinking some coffee".

I worked at a cellphone kiosk in a mall for a short while and the 24 year owner had several kiosks and was clearing big bucks every month, but he was a great salesman and in turn trained great salespeople. For the interview process he had me literally flagging down people walking by - this is how good salespeople make sales.

It's not like selling bottled water where people are going to just come up to you and hand you a sale. At the very least I recommend working at one of these places first like stand advised.