Action Plan Online, Part 2 of 10

Until 1993, Dale Willerton, the Lease Coach, was a shopping centre manager. He saw tenants overpaying for their business space every day. Today, he and his team of negotiators help tenants get a better deal. Here Willerton identifies three common mistakes to be aware of when negotiating leases.

MISTAKE #1: Failing to create competition for your tenancy.
Willerton tells all his clients to pick two to four locations, even if you have a favourite, because then the landlords have to compete against each other. If one landlord will give you three free months of rent, maybe the next will give you four free months. “But tenants say, ‘we love this building, we drive by it every day’ and then the landlord has you over a barrel.”

MISTAKE #2: Mistaking the timing of your move.
The best time to open a new location in a shopping mall is two to three months before Christmas. “I had tenants who had bought a franchise and were putting the lease agreement together and planned to open in October. Instead, they opened on December 21 because they just didn’t factor in how long it takes,” Willerton says. It’s no use moving into a great location if your timing is poor – allow more time than you think you need to get the maximum value out of your move.

MISTAKE #3: Adopting the wrong mentality.
“Most people negotiate not to lose,” Willerton says. “But that’s like the Calgary Flames negotiating for a tie.” As an example, Willerton says he had a client in Calgary who said, “Don’t even show me a location if I can’t get three months free.” “So I showed him a location offering 12 months free rent. He said, ‘How did you possibly get a year’s free rent?’ I told him, ‘I asked for 18 months.’”

Lower Your Overhead – Painlessly
A few ways to renegotiate your “fixed” expenses.

Q&A with Barb Stevens, trade manager at SabreTEC, on how to barter your way to a lower overhead

Reduce Your Overhead