Sharing Retail Space With Another Business: A Guide

Updated: October 8th, 2022


Brand Exposure
Cost Details
Sharing retail space means you share the ongoing cost

What Is A Shared Store?

Sharing retail space, or often co-retailing refers to an arrangement where entities agree to share a shop or retail store with one another.

Co-retailing may sound impractical, but there is so much to it than what meets the eye. This is considering that sharing store space is a great phenomenon as it is an opportunity to extend your current customer base while cutting ongoing costs.

So, how does this concept work and why should you consider sharing retail space with another business? In this post, we elaborate on how co-retailing works, and detail why it is a great idea for startups.

Co-Retailing Key Takeaways

  • Space-sharing situations turn out rewarding for both parties.
  • Retail space sharing works for your customers and local community
  • Compatibility issues can wreck both businesses

Understanding How Co-Retailing Works

The retail sector is undergoing a booming phase as new technologies are making their way into the market. Retailers are trying to stay ahead of the competition by applying various new techniques. Co-retailing is one such idea.

Shared retail space compares to co-working. However, rather than sharing office space, the entities share a shop or a retail store with one another.

With co-retailing, entities share resources such as the business space, stationery, and other components, hence cutting the startup costs as well as the running costs.

Why Shared Retail Space?

The concept of shared retail space is a boon for startups. This is because co-retailing helps startup owners in various ways.

Here are good reasons to consider co-retailing.

1. Cuts Startup and Running Costs

The perfect location may be too large, hence not economical for a small retail shop.

On the other hand, maybe the rent could be too high for a startup founder to afford alone.

Apart from rent, there are other operational costs like utility bills and even licensing costs.

Fortunately, retail space sharing, lets business owners share the startup and running cost. The amount saved can go into improving the quality of goods and services.

2. Additional Source of Income

If a business needs less space than what they have in hand right now, renting the extra space for a co-retail could provide an additional source of income.

Better still, the extra income can come in handy during the low business season.

3. An Opportunity To Expand Your Customer Base

With a bit of planning, most space-sharing situations are an opportunity to expand the customer base.

This is often the case, where the two businesses complement each other, rather than compete.

For example, where startup A is a coffee shop and startup B is a bakery, the two complement each other, and a co-retailing agreement between the two is a chance to expand each other's customer base.

4. Offer Customer Conveniences

Customers love the experience of sourcing complimentary services or goods under one roof.

This is considering that offering when complementary services or products are available under one roof, helps maximize customers' time.

Creating better customer experiences generates customer loyalty and improves business profitability.

Real World Examples: Share A Store With Another Business

Here are examples of businesses that have applied the co-retailing concept successfully.

1. How 11 Honoré entered into an exclusive partnership with Nordstrom Deepening Their product offerings

Recently, 11 Honoré, a seller of the latest in designer plus size women's clothing, announced their partnership with Nordstorm, an American luxury department store chain.


The strategic partnership allows the two brands to deepen their products offerings. Moreover, the plan will see the brands sharing costs and risks as well as increased drop-shipping and concessions.

“The vision behind the 11 Honoré collection has been to offer more women the fashion they expect from us, the fit they can count on, and a more accessible price point,”. Nordstrom is the perfect partner to help us evangelize this message of inclusivity and reach more customers.”

Says Patrick Herning founder of plus-size luxury marketplace 11 Honoré.

2. How Target and Lego Group Came Together Through a Retail Sharing Agreement

Target and Lego Group are working hand in hand to reimagine the brand’s iconic colourful bricks into a myriad of items that give guests even more reason to come together through a curated assortment that celebrates self-expression.


The two brands came to create an exclusive product line sold in their department stores.

“The LEGO brand is rare in its ability to equally excite all members of the family, and we expect that excitement to soar as we offer LEGO fans young and old the opportunity to experience our brand in an entirely new way through this partnership,”

Says Satwik Saraswati, design director at the LEGO Group.

Tips For A Successful Retail Space Sharing

  • Choose a brand that offers your target customers complementary products or services and not alternatives.
  • Run a detailed background check to see if there have been any serious issues of insubordination in their firm
  • Discuss the lease agreement and determine how to split rent and other resources
  • Ensure to maintain an undisputed identity event
  • Find ways to create a lasting impression on your customer's mind
  • Create custom deals with your co retailer to benefit each other's customers

Break the costs according to the consumption of both parties.


Sharing retail space could be a cost-effective method to start a new business. You can increase the customer base as both entities share customers with one another.

In addition, sharing retail space lets you get a better location to run your business while paying less rent. However, you have to be keen when choosing a co-retailing entity and formulating the agreement. Follow the tips outlined above, and involve an experienced attorney in the formulation of your co-retailing agreement.

meet the author
Pat Walls

I'm Pat Walls and I created Starter Story - a website dedicated to helping people start businesses. We interview entrepreneurs from around the world about how they started and grew their businesses.