How transparent are you in your work?
A conversation with a fellow business owner prompted this question recently. As an independent consultant who works for and on behalf of the tenant, rather than the landlord, in a commercial lease negotiation, I’ve always prided myself on my transparency with prospects and clients. Sometimes, that has meant ‘losing out’ on potential business. But is it really a loss if the prospect’s problem was solved? Not to me!
Too often I see business owners enter into the world of commercial property with little or no knowledge of which premises are right for their business, or how the lease negotiation process works. As a result, they are likely to miss things and can sometimes be taken advantage of, or worse, they end up relying on the landlord or their agent for guidance. If you are considering taking on or moving business premises in the next 12 months, I’m sharing this blog to give you an overview of the main stages of the premises search and lease negotiation process, with a brief explanation of what you may need to consider for each.
Needs analysis
Ask yourself what your premises needs to deliver, and whether it has the correct features, technology, and specifications. How will your premises make a meaningful difference to your bottom line? Does it motivate/stimulate your team? How will you measure the value it delivers? This is the time to be transparent and honest with yourself about what your business needs to grow and thrive. You can think of it like writing a job specification as you would for a new employee – essentially it’s not very different. Your premises should deliver to your bottom line in much the same way.
Search/assess
Once you have your requirements list or ‘job spec’ together, it will be easier to assess your current premises, prioritise your needs as a business and truly understand whether you need to move, and what to look for if you do. If you decide to stay in your current premises, you can still move to the next step (negotiate), but you will be renegotiating your current lease rather than entering a new one. If you do decide to move, your next step is to find the closest match in the market, using your ‘job spec’ to search for the right premises. Consider what compromises you are prepared to make vs what elements of your ideal premises are non-negotiable. COnsider how transparent the people in the process (estate agent, landlord) are being with you vs what they may want to hide. Do not assume anyone is acting in your interest! View as many premises as you are able to, in order to form an accurate view of what is available in the market.
Negotiate
Negotiation time. It’s important to remember: signing on the dotted line of your Heads of Terms isn’t the first thing you need to do – it’s the last! This is not a one-and-done event – it is a negotiation. As a prospective tenant or even existing tenant, you are in a position to give your Landlord a proposal for lease terms that work for you (and that you suspect they might view favourably). In fact, being transparent and laying out your ideal lease terms up front will give you more power when it comes to negotiating. Ensure you agree all the details of the deal before the matter is passed to solicitors. After that, making major changes becomes difficult!
Review business plan
Once you are happily settled into your new premises, try not to assume that ‘premises’ is ticked off your to-do list. A regular review is essential to ensure your premises continues to provide your business with what it needs. Come back to your job specification as many times as you need to assess how your premises is ‘performing’ – just as you would with an employee appraisal process – and continue to be transparent and honest with yourself about what is working – and what isn’t.
Need some help?
My mission is and always has been to empower the business owner with the right information to make the right choice for them and their business. If I can tell them everything they need to know during a chat at a networking event or one of my free mentoring calls, then so be it.
If you are looking for guidance on taking on or moving commercial premises, book a free mentoring call with me, and let’s see if we can solve your issue in 30 minutes or fewer!