Gift Basket Review - November 1997
Moving from Home to Store: Three Journeys - By Kathy Horak

Stella Delap marks six years in her gift basket shop on Nov,4

Sheree Zielke opened Applegate's Gift Basket Emporium in Edmonton, Canada, this past May. She sells inventory to other Canadian basketeers as well as gift baskets and gifts to consumers.  Zielke's 2,350 square-foot shop fulfills one of her long-standing goals.

Judy Cannady was pushed into her Fayetteville, NC, retail site by her husband, Philip. He rebelled at her home-based operation last Christmas, when their house was so jammed with a 500-basket order, "he couldn't put up his snow village or get to the stereo to play Christmas records," Cannady says.

Although the destination may be tantalizing, the road from home to store design, hiring, training and paying employees -- any of these can become costly, damaging potholes.

And of course, there's that really big hill: ensuring sales are enough to cover overhead -- which is many times what a home-based gift basket business faces -- and writing yourself a paycheck that the bank will cash.

Here's how the journey goes for these three basketeers.

Are You Ready?

Delap opened Basket Kreations in Canton, MI, on Nov 4, 1991. She negotiated her first lease with a landlord who called her crazy when she named her price.

Delap countered that the space had been empty for some time.

Indeed, many U.S. cities have plenty of vacant storefront due to overbuilding in the late 1980s and store consolidations or bankruptcies throughout the 1990s. One very recent example is this year's Chapter 11 reorganization of Woolworth's which spelled the end of America's five-and-dime-era. (The parent company still runs other stores, such as Foot Locker.)

"There's always space out there, but that doesn't mean it's desirable," says Geneva Henderson, a retail real estate specialist with Charlotte, NC-based brokerage Lat Purser & Associates. "I'd think gift basket companies would want a higher income area, perhaps a shopping center anchored by an upscale grocery store."

Canton, MI, once a sleepy rural burg west of Detroit; today it's a thriving community of 70,000. Delap's shop is midway between Canton and upscale Plymouth.

Basket Kreations moved twice within the same strip mall since 1991, first to 1,900 square feet, then to its present space. Delap financed it by saving and reinvesting.

"I never applied for a loan, and I'm most proud of that," she told a seminar on "Moving From Home to Storefront" at Holiday Jubilee! 97. "I constantly re-entered money back into the business."

Sheree Zielke did the opposite. The Canadian took a $50,000 mortgage on her home to open Applegate's, though she says she hasn't dipped much into the loan. Zielke owned Corporate Thank-Yous, a gift basket business in a warehouse with showroom, for seven years. She also runs Sir Unicorn Special Events.

She spent three years researching her dream. When Applegate's opened, "it wasn't really scary because I planned for it. I put the numbers down on paper."