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How can your physical store compete with online shops? By offering your customers an additional experience or service and being more than just a store. For example, by having a coffee corner or offering a wider range of products. However, this is not always allowed. What do you have to pay attention to and how can you regulate this?
Blurring, mixed-use formulas, industry blurring, mixed concepts – all words for the same phenomenon: a business offers additional services or products to its original products. Classics include coffee and cake in the lunchroom at the baker’s, tastings at the liquor store and, of course, breakfast at Ikea or HEMA. But the extra product or service might also be a second leg to stand on in the shop’s product range, for instance a nut bar at the cheese shop or ready-made meals at the butcher’s. So plenty of opportunities for innovative entrepreneurs.
Nevertheless, there are some things you better take into account. Not every combination is allowed. Sometimes a permit must be applied for first, a permit to derogate from the zoning plan is needed or the landlord must give permission for derogating use of the leased property.
A zoning plan prescribes what function or functions a particular plot may have. This may be a store, a hospitality establishment or both, for example. If the function is only shop, the property cannot be used for catering activities and a permit to derogate from the zoning plan may be required.
A zoning plan may also include rules for special types of shops. For example, the zoning plan for the Amsterdam city centre states that no more tourist shops may be added, such as Nutella themed shops. For some of the existing shops, this ban will also apply if the shop is terminated. So the new owner will then have to start offering a different assortment, which is more geared towards inner-city residents. In addition, the retail trade policy of the city does not allow new stores offering food and drink to apply a mixed-use formula. On the other hand, three areas with high vacancy rates outside the city centre are free zones, where blurring is explicitly allowed.
Online shops and flash delivery drivers are special cases. An online shop is not a physical store, therefore, it cannot use plots that are meant for retail trade. The same applies to flash delivery services. Anyone who wants to be centrally located in the city as a flash delivery service will not be able to use retail space unless there is a possibility for derogation from the zoning plan or an integrated environmental permit has been granted for it. In practice, this will be hard, as municipalities fear that dark stores will cause nuisance, for example by loitering drivers waiting for the next call. Moreover, dark stores are also operating outside normal shop opening hours.
Arrangements have to be made not only with the municipality but also with the landlord if the lease agreement does not allow for other activities to take place in the premises or for a different assortment to be offered. The latter may come into play especially in shopping centres because there you can often find a balanced mix of shops, complementing each other rather than competing with each other. Different use of the premises may also require remodelling, which requires the landlord’s permission, for example the installation of a better and bigger kitchen for the coffee corner in the bookstore.
Sometimes a different use of the premises may even lead to a change of the rental regime. This may come into play if someone starts selling goods from their warehouse space and the sale becomes the main activity. A tenant of a warehouse enjoys much less rent protection than a tenant of retail or hospitality space.
You may also need a permit for an additional activity or extension of your product range. The best-known example is that, without a permit, it is not allowed to serve or sell liquor. Currently, according to the Alcohol Act, this is not allowed without a liquor or catering licence. The current cabinet does want to make this possible, according to the coalition agreement: “We will allow the mixing of functions in retail by regulating ‘blurring’ in shopping areas in a responsible manner, with strict monitoring of alcohol abuse.” However, this has not yet resulted in a legislative proposal and the initiative proposal Mixed-Use Formulas from 2018 seems to be on hold.
So for now, having a glass of prosecco at the hairdresser’s or the bridal shop is not possible unless a licence has been applied for and granted. The same applies to the reverse: the restaurant owner is not allowed to sell art works from his walls and a liquor retailer is not allowed to sell other products than drinks in the same room or online shop.
Would you like to know whether your plans are in line with the zoning plan and your lease agreement? Or whether you need a permit? We will check this for you and, if necessary, help you apply for a permit or procedures for derogating from the zoning plan. We are also happy to assist you in concluding purchase and rental agreements and dealing with disputes about them. Please contact our specialists:
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