With brand‑name home‑textile franchise stores springing up everywhere, large department stores and shopping malls have become hotly contested venues where home‑textile brands vie for prime locations. Yet, the stringent terms and conditions imposed by these major retailers often place immense pressure on shop‑in‑shop operators. Consequently, conducting a thorough analysis of the mall’s policies and requirements before entering is essential. Only by knowing both your own strengths and the other party’s position—and devising a well‑thought‑out strategy—can you maximize benefits, sidestep potential pitfalls, and achieve your desired negotiation outcomes.

Price terms

　　(1) When a retail outlet cannot secure the best nationwide pricing, it often settles for a second-best option: first negotiating the most favorable supply price with suppliers in a specific region, then gradually working to achieve the best national pricing. The company should establish a unified national supply price and rigorously review all regional store agreements; maintaining stable, consistent pricing is of paramount importance.

　　(2) In addition to securing the most favorable pricing, retailers will also seek volume‑based price discounts. While maintaining a uniform pricing policy, the company can leverage this provision—subject to certain conditions—to encourage retailers to procure more non‑primary‑specification products, thereby sidestepping other requirements such as unconditional rebates.

　　(3) When supplier product prices change, retailers typically stipulate that suppliers must notify the retailer of such price adjustments at least 30 to 60 days in advance. The primary purpose is to safeguard purchase prices and mitigate the risk of price increases by suppliers.

Cashback Terms

　　(1) Retailers often stipulate in contracts that tenant brands must pay a percentage of their annual invoiced sales as an unconditional rebate, intended to bolster gross margins. Brand‑name home‑textile tenants should strive to avoid this rebate by negotiating conditional terms for each phase of payment, thereby gaining greater control over their sales strategy.

　　(2) Conditional rebates represent another approach whereby retailers leverage their own sales growth to secure margin support from brand‑name home‑textile suppliers. This arrangement benefits the suppliers and helps reinforce the retailer’s commitment to and emphasis on the product line.

Fee Terms

　　(1) Retailers typically leverage their channel‑specific advantages to encourage tenant brands to pay product‑related fees, such as onboarding account opening fees for new suppliers, new‑product launch fees, and individual item barcode fees.

　　(2) Retail outlets typically allocate substantial sponsorship‑related expenses to subsidize gross margins. These include new‑store subsidies, holiday‑promotion fees, store‑anniversary contributions, refurbishment costs for existing stores, and funds for special events. Home‑textile brands should strive to avoid such expenses, as they are not directly tied to product sales. Suppliers should endeavor to convert these costs into promotion‑driven expenditures that are closely linked to sales, thereby enhancing sales‑driving effectiveness.

　　(3) The marketplace provides入驻 merchants with business insights through its fee‑based services. Home textile brands should leverage this platform to gain a clear understanding of their products’ average sales volume, sales cycles, peak demand periods, and their relative strengths and weaknesses compared with similar offerings. By assessing their position within the marketplace, these brands can better exert influence and secure more favorable support.

Promotional expenses

　　(1) The store‑specific fees for each promotional activity, such as end‑cap fees, DM advertising costs, and shelf‑end fees, vary by promotional period. This is particularly evident in stores that employ decentralized management.

　　(2) For home‑textile brands entering the marketplace, promotional expenses should account for at least 70%–80% of the total contract value. Such expenditures create favorable conditions for product competition, enable participation in market contests, and help boost sales volumes.

Logistics Treaty

　　(1) Follow up with the retailer to confirm their acceptance of the minimum order quantity (MOQ) terms, which will help reduce shipping costs and ensure a steady supply to maintain smooth sales.

　　(2) Retailers that operate distribution centers typically charge suppliers a percentage of their annual sales as a delivery subsidy. Companies should estimate the delivery costs for direct shipments to individual stores and to the distribution center, taking into account the store network’s geographic distribution, historical sales volumes, order frequency, and the company’s own logistics costs. The subsidy rate is then set within the range between these two cost estimates.

　　(3) Inventory is a key factor influencing store operating costs, and they aim to mitigate inventory risk by offering unconditional returns.

Payment Terms

　　(1) For home‑textile brands, the receivables from the retailer constitute the retailer’s payables; consequently, their payment terms are at odds. Retailers typically set a specific payment period—e.g., payment is due within a certain number of days from the date the retailer receives the brand’s invoice.

　　(2) Home‑textile brands entering a retail outlet should strive to secure payment discounts and shorten the outlet’s payment terms. At the same time, they must closely monitor the outlet’s receivables reconciliation process, regularly compile records of overdue payments, and promptly file complaints when necessary.

　　(3) To reduce cash outflows and ensure the collection of fees promised by tenant brands, shopping malls typically deduct various contractual charges directly from receivables. Given the long payment terms and the complexity of contract‑related fees, this practice can easily lead to accounting discrepancies. Moreover, if erroneous deductions are not promptly identified and corrected through reconciliation, they may become irreversible losses. Home‑textile brand tenants should proactively propose effective measures to ensure that all agreed‑upon fees are remitted to the mall accurately and on time.