Opening a store in a mall promises a lot in hindsight – consistent foot traffic, a ready-made ecosystem of complementary brands that can translate to sales.
But practically speaking, not every visitor who walks by is a potential customer, and you can’t open a store in a mall just because it promises consistent footfall.
Some are there for entertainment, some just to window-shop, and others may only be passing through to reach a specific store.
Foot traffic is just one factor, though it’s a very important one.
This article lists the 9 factors you should check before opening a store in a mall.
9 factors to know before opening a store in a mall
1. Catchment area of the mall
The catchment area of the mall and its demographics significantly impact your potential customer base.
Study the demographic data of the mall’s location, including:
- Income levels and purchasing power
- Age distribution and family compositions
- Education levels
- Cultural preferences and spending habits
- Commuting patterns and accessibility
These demographics can vary dramatically from one mall’s location to another.
To give an example, let’s compare the demographic data of Nexus Mall in BTM Layout, Bangalore, to Nexus Mall in Koramangala, Bangalore, within a 10-minute driving catchment.
Source: RetailIQ’s site reports
While BTM Layout has more households and a higher number of households earning above ₹5L annually, its lower affluence score compared to Koramangala means less actual spending power.
So, despite the larger numbers, Koramangala may yield better conversion rates and higher average order values, especially for premium brands.
That said, BTM can still be a strong choice if your product and pricing suit the local consumer profile. Value-for-money, essentials, or mid-range lifestyle products can perform better with BTM’s volume.
The key is aligning your brand with the area’s demographics and spending behaviour.
2. Retail ecosystem in and around the mall
The retail ecosystem within and around the mall significantly influences your store’s performance.
Analyse:
- Large retail tenants driving mall traffic (e.g., fashion stores, cinemas, popular food outlets)
- Complementary retailers that might share your customer base
- Direct competitors that could dilute your market
- Nearby commercial establishments that affect mall visitation
Complementary brands and crowd pullers landscape of a location
The surrounding ecosystem, like gyms, clinics, co-working spaces, or bus stops, can attract similar footfall to the mall and then to your store, which may convert into customers.
So don’t just think of the mall in isolation, but also evaluate the broader retail ecosystem in that location and how your store fits into it.
3. Store location within the mall
Where your store is within the mall plays a vital role as well.
Here are some of the factors you can consider:
- Proximity to main entrances and exits
- Visibility from major walkways
- Location relative to escalators, elevators, and staircases
- Proximity to food courts or other high-traffic areas/stores
Rent may increase slightly in this high-visibility and high-traffic zone, so try to balance visibility with viability.
4. Merchandise mix
Your merchandise mix must align with both the mall’s positioning and the expectations of its visitors.
Consider:
- Price points relative to the mall’s typical shopper profile (age, gender, spending capacity and other demographics)
- Product categories that resonate with local preferences and needs
- Seasonal relevance for the region
- Visual appeal and display potential of your merchandise
Merchandise buying should not be decided based on past sales of a particular SKU or category. It should be data-backed.
Our platform eliminates guesswork and enables data-backed demand planning for merchandise at the SKU and store level.
This granular level understanding helps you stock the right products in the right quantities.
| Fact byte: GeoIQ helped major eyewear see 45% more sales with the right merchandise mix!
5. Rental and lease agreement
Some malls operate on a fixed rent model, while others follow a revenue-sharing model or a mix of both.
It’s important to understand which one works better for you.
Lease agreements also typically include a lock-in period along with specific exit clauses and annual rent escalations.
It is said that the average rent at top malls comes with a 15% hike every three years. However, some malls are trying to push for a 20% rental increase over the next three years, citing inflation.
While this may be true, it’s worth noting that top retail chains like Aditya Birla Fashion, Shoppers Stop, Jubilant FoodWorks and Tata Trent have reportedly saved over ₹1,500 crore in rent by negotiating.
So, it’s worth negotiating better rental and lease agreements that work for you.
6. Mall reputation
A mall’s brand reputation directly affects yours.
If the mall has a history of high footfall, strong marketing efforts, and good tenant retention, that’s a green flag.
But if stores keep shutting down or there’s a declining buzz around the mall, that’s something to look into.
You should also check the future development plans for the mall. All of these can impact your store’s performance, either positively or negatively.
7. Store layout
Your store layout should be eye-catching, welcoming, easy to navigate, and overall visually engaging.
If your products are cluttered or the signage is unclear, chances are people will walk past, or worse, walk in and leave in seconds.
Consider placing your high-margin or fast-selling products in high-visibility zones. Trial rooms (if applicable), billing counters, and product displays should all be positioned to create a smooth customer flow.
This will help customers easily navigate and increase dwell time.
8. Stock replenishment and logistics behind it
Demands can spike rather quickly during weekends, particular seasons, mall-wide promotions and more.
To not lose any sales during these periods, make sure your supply chain is agile enough to keep up with sudden surges in demand without overstocking.
Check if the mall has any restrictions on delivery times, vehicle access, or storage limitations.
Some malls may not allow restocking during peak hours or have strict basement access rules which can slow things down if not planned in advance.
9. Financial viability and break-even analysis
Before locking in a mall location, you need to run the numbers once, realistically.
Evaluate all cost heads: rent, staffing, inventory, store setup, mall-specific charges (like maintenance charges), and marketing spends.
This gives you a clear picture of whether the location is financially viable in the first place and when you’d be able to break even.
Using historical sales data, mall footfall projections, demographics and other vital data, we help brands build accurate revenue projections.
This data-backed approach often helps our clients break even 45% faster than traditional methods based on intuition or outdated benchmarks.
Conclusion
Opening a store in a mall means a significant investment of capital, time, and entrepreneurial energy.
But the success depends on thorough research. The factors outlined above are all critical
pieces of the puzzle.
Book a demo with us to see how our platform can help.
