Shelf rental – sometimes called space rental – is a booming business area, one that provides hefty profits for several different types of entrepreneur.

But despite the name, no one in this business actually hires out shelves in the real sense. Rather, it refers to space on those shelves where clients can display and sell their own products, without even having to be present to take payment and hand over the goods.

This flourishing enterprise works in many different ways and with careful planning most of us can make healthy profits without suffering cash flow problems or entering long term contracts.

I enjoyed researching this idea so much and was so impressed by the enormous profit potential that one eletter can’t contain this whole report – and so will conclude in next week’s missive!

What is shelf rental?

Most shelf and space rental ventures involve shop owners, sometimes stall holders at fairs and outdoor markets, sharing their available selling space with other product owners.

Clients pay according to space required and most shop and rental space providers display and sell goods for clients. On top of rental, some will charge a commission on sales.

Examples you may be familiar with already:

• Paintings sometimes adorn the walls in cafes and restaurants. The artist’s name will be highlighted along with the price for the painting. Sometimes the artist’s phone number or email address will be given and sales will be direct between artist and buyer. With no obvious contact details, it is likely the cafe or restaurant owner will take payment and earn a commission on sales and let the artist fulfill orders.

• Antiques and collectibles malls with booths or glass cabinets – or sometimes just shelves and table and counter tops containing products from various named dealers – exist in almost every large town and city. Most independent dealers pay a monthly space rental fee plus a commission on sales.

In both cases, product owners might only ever visit the premises to replenish stock.

Here are some less obvious variations of shelf and space rental:

• Shops – especially coffee bars and craft and gift shops – rent space to non-competing product suppliers. Usually just shelf space but you can have as much as you like. Hosting businesses take payment and pack goods for buyers and share the proceeds with product owners.

• Pop up shops serve a similar purpose to fairs and other one day itinerant events, sometimes allowing traders to test market a new product before deciding to offer it wholesale or from a newly created website or dedicated high street premises. These temporary outlets are just perfect for riding a profitable trend and shutting up shop when demand declines.

Of all shelf and space rental options, pop up shops are possibly the most beneficial and hassle-free for new and experienced sellers because they are:

–  Perfect for trending and faddy products, allowing sellers to move quickly into high demand markets and exit fast when interest dies. For example: Christmas goods and novelties, Valentine’s Day gifts, dog food and accessories timed to coincide with a high profile, heavy pedestrian dog show, the Olympics and other major sports events, and much more besides.

– Usually very cost effective, even in the highest footfall shopping locations – including London, Paris, New York and virtually every major town and city in between. Traders sometimes have an entire shop to themselves or rent space in high traffic shops in central London and various other towns and cities worldwide.

Learn more about hiring pop up space in towns and cities across the world by having a look around here.

Up to now we’ve considered space available from other people owning the premises, primarily for selling your own products or other people’s goods earning you a commission on sales.

But there are other ways to make this business work well without having your own products or relying on other people for space or taking financial risks of any kind.

Here are just two ways to achieve that objective:

• Be the person renting out space in your own premises. You’ll normally be renting out physical space but you can do the whole thing online, by opening a shop at Shopify.com for instance, or countless other eShop providers. Charge product owners a monthly fee to place a specified number of products in your shop.  You list the products, take payment, send out deliveries, and each month work out how much money you keep and what goes to the vendor.

Just consider the basic earnings potential of renting space to twenty sellers, each paying £25 monthly rental fee, before thinking about taking a commission on sales. Say you pay £500, all costs included, each month for a small shop on the high street (or much less for a virtual shop presence). Right away your twenty partners paying £25 rent each per month – total £500 – have covered most of your own offline shop overheads and made a massive profit on internet-only trading. The rest, commissions from clients and sales of your own products, are icing on the cake.

• Hire space from established business owners with heavy passing trade and an extensive customer base. Grocers, supermarkets, cafés and restaurant owners are your likely best partners. Share the space with your own clients. You should attend to display and replenish goods and get business owners to make sales and take payment and keep careful records of sales, breakages, returns, commissions earned, and so on. At the end of each month, you pay your own bills and send a statement of earnings and charges to your own clients. Deduct your own fees before settling up with product vendors. Charge your own clients before allocating space and cash flow should never be a problem.

Wasn’t that all just amazing? And easy. And involving little physical effort on your part.

If you agree, as I’m sure you do, then next week’s eletter will provide more information to help you make a fast start in this simple-to-run and immensely enjoyable business.

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