As a teenager raised in the Philippines, Guy Koren became a fan of the flavored french fries sold at a local mall from a kiosk called Potato Corner. Years later Koren’s fondness for the Potato Corner concept and his certainty that it would play well in America led him to become the international chain’s U.S. franchiser. Koren relocated with his family to Southern California in 1995, and 15 years later he opened the first Potato Corner kiosk in the U.S., at Westfield Santa Anita, in Arcadia, Calif.
Today his Potato Corner USA franchise operates nearly 30 kiosks at U.S. malls and is expanding at a brisk pace. “I fell in love with the Potato Corner concept as a customer,” said Koren. “When I was in high school in the Philippines, I’d come home from school and run to the mall to get my barbecue-flavored fries three or four times a week.” Koren says he has set his sights on expanding to about 300 units, with a focus on malls.
It seems his timing could not be better. In the U.S. and elsewhere, mall landlords are seeking to offer a wider, more exciting array of convenience foods; they are reaching out to promising cart and kiosk food concepts, such as Potato Corner, which typically locates in center-court areas, high-traffic hallways or near the food court. “Food carts and kiosks are definitely a major trend,” said Franka Lange, managing director of the German branch of Glasgow, Scotland–based Retail Profile Europe. The firm manages shopping centers in the U.K., Germany, Russia and Scandinavia. Food carts and kiosks, some of which are equipped with bar-style seating, tend to encourage shoppers to slow down and linger, Lange says. They also add an element of excitement to common areas, and they appeal to time-pressed shoppers craving something beyond soft pretzels, ice cream and candy — the traditional mall snack-food fare. “Customers who stay longer at the shopping center tend to visit more stores, and a good variety of food offerings encourages shoppers to dwell,” she said.
In both the U.S. and around the world, food carts and kiosks specializing in anything from ethnic foods to fresh-pressed juices have sprung up at malls. Perhaps not coincidently, these concepts tend to be popular with younger demographic groups, which has helped drive the food-truck craze in many urban markets. “Food has become the new fashion in some markets,” said Ted Kaminski, senior vice president of specialty leasing for Westfield. “This whole Millennial generation is all about discovery,” he said. In fact, social-media sites are rife with pictures of food “discoveries” of all sorts, he notes. “A lot of what is hip and cool in terms of food can be found on Instagram, Facebook and Yelp.” Members of the Westfield leasing team follow food and social-media sites to stay abreast of trends and help identify potential tenants, Kaminski says.
In the U.S., food carts and kiosks have gained such a following partly because Americans seem to be perpetually in a hurry. U.S. workers tend to break for lunch just four times during the workweek, on average, and those “hour” breaks tend to last just 35 minutes when travel time is factored in, according to Paul Fetscher, president of Great American Brokerage, of Long Beach, N.Y. What is more, snacks replace meals among some, particularly breakfast and lunch; Americans snack an estimated five to seven times per day, Fetscher says. This may bode well for concepts offering satisfying concoctions that may be eaten on the go, such as Japan’s Eight Turn Crepe, which specializes in crepe cones with such fillings as avocado and grilled shrimp. Eight Turn Crepe has opened its first U.S. outpost, in New York City, and has plans to open additional units, according to Fetscher, whose firm is representing the chain on the rollout.
“What we have is a time-starved consumer who is willing to trade dollars for convenience, paying a buck or two more to get something better than a Big Mac meal,” said Fetscher. Great American Brokerage also represents Greece’s Chillbox, a purveyor of Greek frozen yogurt which has, like Eight Turn Crepe, opened its first U.S. store in New York City and has additional expansion plans, including units at malls.
In global terms, food carts and kiosks have gained popularity but with subtle differences among markets. In some places, such as Russia, the scene is heavily skewed toward international chains like Dunkin’ Donuts and Subway, says Lange. In the U.K., though, carts and kiosks tend to be run by entrepreneurs with unique concepts — such as champagne bars or artisan foods.
At Westfield London and Westfield Stratford City, food kiosks complement in-line luxury stores. Located in the luxury wings of the malls, these kiosks include champagne, sushi and tapas bars. “They have gone a little further with these larger-footprint kiosks where you can sit down and have a meal,” -Kaminski said of Westfield.
There are issues that both landlords and tenants need to consider. Carts and kiosks have traditionally been a way for entrepreneurs to launch concepts relatively inexpensively, but food kiosks can carry a big upfront cost. Kiosks that incorporate seating, for instance, may be as large as 300 square feet. If the purveyors are preparing food on-site, as many do, they may have to invest in special equipment, and/or make extensive mechanical, plumbing and electrical upgrades to a location, although the upfront cost is sometimes covered by a tenant allowance.
“The whole idea of prepping food on-site and having customers watch food being prepared is really exploding, because of the cooking shows on television,” said Marie -VanDrisse, executive national account manager at F.C. Dadson, a -Greenville, Wis.–based manufacturer of carts and kiosks. “It used to be that a lot of product was prepared off-site and brought to the mall and refrigerated. Now a lot of stuff is prepped and cooked on-site, so many kiosks have a larger footprint.” This means that they require more space, she says.
Landlords and prospective tenants alike need to consider the existing food offerings at a given property to ensure that new concepts complement rather than compete. And it is critical to place carts and kiosks in locations where they may enjoy a built-in customer base, says Kaminski. A frozen-yogurt kiosk, say, is likely to do better near junior-oriented tenants, such as H&M and Forever 21, than near a cinema, given that movie theaters do not allow outside food and moviegoers are typically rushing to make the show on time.
“We look at overall sales and foot traffic when evaluating whether to add a new food tenant, but, more importantly, we think about what categories we are light in,” said Kaminski. “For instance, are we light in the frozen-dessert or pretzel category? It’s all about creating smart co-tenancies.”
