How Sales capturing solutions can help mall managements in Turnover- based Rent

Turnover-based rent is popular now among landlords and mall owners. In the turnover rent system, the tenant pays the rent based on their monthly sales. This is a big relief for the tenants in the sales during difficult times. Sales capturing solution plays a major role in calculating the tenant sales for lease optimization.

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How to calculate turnover based rent

Turn over based rent is calculated from the tenant sales. The rent and sales are proportional, which means when the tenant gets a higher sales volume in a specific period he has to pay higher rent in that month. Turnover is calculated mainly in 3 ways. Some landlords fix a base rent to all tenants. Then they will monitor the tenant sales with the help of any sales capturing shopping mall analytics solutions like E-Goal. From the data collected from the tenant, the mall management/landlords can understand how much sales have done in that particular month. According to that, they will decide a turn over rent in addition to the basic rent. In another method turn over rent alone is needed. The tenant has to pay turnover rent based on the sales. In the 3rd method, there will be a margin for taking turn-over-rent. If the tenant sale is higher than that tenant has to pay a particular percentage as turn over rent with the fixed rent.

Benefits of turnover-based rent.

Turn over based rent is like a symbiotic relationship between the tenants and the landlords/ mall owners. During the best sale times, landlords get higher rent, and in weak sale times, both will try to overcome the situation with new techniques. In short, indirectly the mall owners also will try to boost the sales of each store in the mall.  So there will be a healthy relationship between the tenants and the landlords.

During COVID 19 lockdown time, most of the retailers failed to maintain their sales target. It badly affects their profit and they were unable to pay the rent. The tenants who opted for turn over based rent were unaffected and they didn’t feel the rent was a burden in those times. So undoubtedly we can say that a Turnover-based rent system will be the best solution for the landlords and tenants.

Role of Sales Capturing Solutions in Turnover-rent calculation

The sales capturing solution makes the tenant sales tracking task easier and accurate. The turnover data is collected directly from the tenant POS. Sales capturing solutions collect the sales data automatically on frequent days, maybe daily basis or weekly basis. This data is used for rent calculation. The leasing procedure can be simplified by using this kind of solution. The features of Sales capturing are not limited to capturing the sales data. E-Goal, one of the best shopping mall analytics tools by Inditech, can generate sales data, and additionally, they notify the shoppers about new promotions according to their purchase history. It generates an In-depth reporting of the buying behavior and market analysis. The entire mall operations can be analyzed with this tool.

In the upcoming years, we hope 100% of shopping malls in Dubai will change their leasing policy and choose the sales capturing tools for shopping mall analytics and tenant sales capturing. If you want to know more about E-Goal, the shopping mall Analytics Solution, please contact us.

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