Hidden Value in Your Commercial Lease

TODAY we're going to talk about discovering potentially hidden 'CASH, KEYS, and CREDIT' that could be available for your account! 

(Have I got your attention?)

AND, as enticing as it was for me to try spell the word "KEYS" with a "C" in order to have three "Cs" in my opening line, I resisted that temptation. (smile)

It's also very tempting to 'go with the flow' in negotiating your lease, and the result can be that a significant amount of value is either missed or underutilized. The Commercial Leasing Tips for Tenants in this post offer a number of great suggestions that can improve the cash flow and cash position of your business, regardless of whether you're at start-up, in growth mode, or looking at winding down your business operations.

In working with my clients, I've found that the first two tips have been of particular value as they've been setting up their business locations. It always seems that there are more requirements for cash, than cash available, so these suggestions can really be helpful. At the other end of things, the third tip can put more control into your hands at the end of the term of your lease. We think that's a 'smarter' way to negotiate your lease!

NOW, please enjoy these fine commercial leasing tips from our friends at The Lease Coach!

Dale Willerton and Jeff Grandfield

Negotiating Commercial Leases & Renewals For Dummies

Commercial Leasing Tips for Commercial Tenants  By: Jeff Grandfield – The Lease Coach 

For many business-owners, negotiating a good lease or lease renewal against an experienced agent or landlord can be a challenge. While an entrepreneur focuses on marketing and managing, savvy real estate agents and brokers are specialized sales people. Their job is to sell tenants on leasing their location at the highest possible rental rate.

As explained in our new book, Negotiating Commercial Leases & Renewals For Dummies (co-written with my colleague, Dale Willerton), tenants may go through the leasing process only two or three times in their entire lifetime – yet they have to negotiate against seasoned professionals who negotiate leases every day for a living. 
Negotiating appropriate leasing terms is vital for an entrepreneur as the amount of rent he pays will directly affect the business’ financial bottom line.

Whether you are leasing a new location for the first time or negotiating a lease renewal for your business, these are some money-saving tips for tenants:

Negotiate for Cash and Loans: Some landlords will actually pay cash incentives to tenants who lease commercial space in their building. Other tenants can often get quasi landlord loans. Note that this money is often blended into the rent so it’s not necessarily free (the landlord expects a certain net effective return) but it can certainly make your business start-up easier. If you wish to receive a cash incentive or loan, demonstrate why you need the money and explain what you will spend it on (e.g. paint, carpet, etc.).

Turnkey Construction Advice: If the landlord does your leasehold improvements, they are supposed to turnkey the space. It’s up to the tenant to create a comprehensive wish list of the necessary improvements required. In the Offer to Lease, stipulate that the landlord does the space design; secures permits; and completes the job on, or before, a certain deadline. Extras or add-ons will be the tenant’s responsibility; make sure that your Offer to Lease is conditional upon your satisfaction with the final budgeted cost.

Apply the Deposit to the Last Month: Before you put down a deposit of any size for the entire term of the lease agreement, read the fine print. You do not want your deposit held for the term of the lease then refunded since sometimes getting your money back is difficult (especially if you are relocating or property ownership has changed). Try to have your deposit applied to a specific month, or the last month of a lease term to avoid potential problems. 

For a copy of our free CD, Leasing Do’s & Don’ts for Commercial Tenants, please e-mail your request to DaleWillerton@TheLeaseCoach.com.  

Jeff Grandfield and Dale Willerton - The Lease Coach are Commercial Lease Consultants who work exclusively for tenants. Jeff and Dale are professional speakers and co-authors of Negotiating Commercial Leases & Renewals For Dummies (Wiley, 2013). Got a leasing question? Need help with your new lease or renewal? Call 1-800-738-9202, e-mail DaleWillerton@TheLeaseCoach.com or JeffGrandfield@TheLeaseCoach.com or visit www.TheLeaseCoach.com.

What's been your experience?  

Feel free to add your comments and thank you in advance 

for sharing this post with those in your circle of contacts!

                                                                                          

QUESTION:  Could you use a COACH and MENTOR?  

IF the ANSWER is YES ...  Take a look at our "NEXT Steps Program!  

If you're looking for flexible and cost-effective Business Coaching & Mentoring, you'll like our “NEXT Steps - Program”. It's been designed with you in mind, and provides 12 months of valuable assistance that designed to fit your busy schedule! 

For more information see: 

"Option 3 – “PVS – NEXT Steps - Business Coaching & Mentoring Program” 

It's listed on our Website Registration page: 

CLICK HERE

Building Value In your Business

One of the signs of a strong and healthy business is one that has controlled growth. 

The owners of the business have a 'solid handle' on where they want the business to go, a plan is in place, and they are using that plan to guide them to that destination!

In this post, our friends from Sunbelt Business Brokers some great tips for business owners to carefully consider. 

Doing so will not only help you increase the potential value of your business in the future, but it can help you better organize and manage your business now!  We trust you'll enjoy this post and benefit from the comments provided below.

Building Value In your Business: Top Financial Factors

Does your accountant dread your visit? Bad record keeping is, in fact, the biggest road-block to selling a business. Buyers want a business with a proven track record of consistent financial performance with solid, growing revenue and earnings. Yet, many businesses are rather flabby when it comes to fiscal fitness. Spending some time with a trainer/coach can boost your strength and health.

Let’s start with some top financial drivers of business value. Focusing on these will make it easier to sell your business and get you more money— then as well as now. Assess your own business, determine which factors affect your business the most and prioritize what you want to work on.

Keeping (in the) Good Books

A correct set of books prepared with proper accounting software is a necessity. Documents need to be current and correct, demonstrating timely remittances and filings.

Compliance is essential: issues with the Canadian Revenue Agency (CRA) or others can freeze your accounts and destroy your business. Continuity is also important. Are you dependent on a single employee who could leave?

Outsourced bookkeeping provides efficiencies that can benefit small businesses as you pay for work that’s being done, not standby hours. Clean and compliant books will contribute to a good relationship with your accountant and save you dollars there, too.

A good bookkeeper will also help you understand your numbers, providing forecasting, financial analysis and identifying cash flow risks.

Keeping good records and communicating any changes is a necessity. Owners often dispose of assets or sign a new lease and forget to advise the person doing their books.

Financial Value Drivers

Clean up the Balance Sheet. A Balance Sheet provides a snapshot of the business’s health. Use it to pinpoint and remove obsolete and slow-moving inventory or excess cash. Resolve potential liabilities and lawsuits, ensure that assets are properly recorded and that expensed R&D investments are noted.

The top reason businesses fail is not poor profit but dry cash flow held hostage in accounts receivable or inventory.

Increase revenues and profits. All else being equal, a better bottom line leads to a higher business valuation: a) sell more to existing customers, b) sell to new customers or c) a combination of the above.

How efficient are you at turning revenue (sales) into profit, i.e. controlling expenses?

Keep in mind that it takes six times as much money to attract new customers to businesses than up-selling, on-selling and generally over-servicing existing customers. You’ll want to keep your customers coming back and bringing their friends with them.

Review and reduce or eliminate discretionary expenses. A $25,000 increase in your bottom line might add $100,000 to your selling price. Phone bills, office supplies and insurance expenditures are areas that should be reviewed by outside agencies annually. Be careful with insurances, though. Your coverage needs to be adequate and the right kind. Having a proper insurance policy with up-to-date coverage assures a purchaser that what they’re buying is protected.

Maintain steady revenue or aim for growth. Steady sustainable revenue beats one that’s erratic.

The greater the market share, the better. Market share can be more important than revenue. A business with a 50% share in a defensible position is attractive to buyers.

Resolve and diversity customer concentration. It’s risky to have any one customer representing any more than 10% of your business. Resolve and diversify supplier concentration. A dependency on any given supplier is also a risk. Line up alternatives.

Prepare reasonable future business projections. Set goals with detailed steps to meet them. Show the earning capacity of your business. Base your plan on existing records, the market and technology; document the steps that will take you there.

Get a business valuation. A valuation tells you where you are now versus where you want to be “X” years from now. A valuation also helps pinpoint changes that can boost the business value.

Research tax implications upon selling the business, including "vendor take back" and earn outs. Who doesn’t want to minimize the tax consequences when selling? Some of the options: share sale, family trusts and deferred payments.

In our next installment, “Building Value In your Business: Top Organizational Factors”, we take a step back to address the operational factors that improve the value of a business for owners looking to sell their business.

Sunbelt Business Brokers Edmonton

Sunbelt’s team of brokers, operating at local and regional levels, have experience selling small to medium sized businesses. 

Michael McCulloch

Dale Alton

 

Sunbelt is the world’s 

largest business brokerage firm with approximately 300 licensed offices located throughout the world, 

and 33 offices across 

Canada alone.

More than 1,400 Sunbelt brokers annually coordinate an estimated 4,000 Main Street and Middle Market business transactions.

A variety of strategies are required to sell businesses from different industries, of different sizes, and in different economic climates. Many Sunbelt brokers have specific industry experience and cooperate with their counterparts to identify the buyer and create the right framework for the sale.

Your Local Sunbelt Business brokers sell a diverse mix of main street businesses valued under $3 Million. Mergers and Acquisitions of larger and more complex business transactions of up to $30 Million are managed out of the Ottawa Head Office. We would like to help you plan and look forward to retirement, expansion or an exciting new business opportunity. 

 

Have you ever thought about selling your Business?

 

Sunbelt represents clients who may be interested in buying a business like yours. If you are thinking of selling a business now or in the next 3 years, discover what your next steps should be. Feel free to contact our Sunbelt Business Brokers Edmonton office if you have any questions or would like a free confidential consultation. Give me a call. Dale Alton – 780-878-8787

Sunbelt - The Place to Buy or Sell a Business.

* Thank you Michael and Dale at Sunbelt for providing us with this helpful article!

Having a business plan can help ensure that you're heading in the right direction with your business, and that you have the necessary resources to get you safely to your intended destination!

In closing, we invite you to consider Pro-Vision Solutions Inc. as a part of your TEAM of business professionals. We're pleased to assist you with your business planning, through start-up, growth and expansion. Let us know if you would like to have a conversation!  

NOTE: For more information on the services provided by Pro-Vision Solutions Inc. and how we can assist ... please visit our Website: www.pvs4u.ca

Who's the Customer in a Commercial Lease?

It's funny how we can easily lose sight of the big picture when it comes to such an important consideration as leasing a business location. It really requires us to do a 'role-reversal' as we shift our thinking from 'doing everything to please our customers', to realizing that in this instance, 'we are the customer!'


To help us refocus, here are some valuable tips and suggestions from our friends at The Lease Coach! At a time when business owners in many markets are experiencing significant challenges, as well as new opportunities, it can be very helpful to engage the expertise of experienced professionals in those areas where they can add great value.

Thank you Dale Willerton and Jeff Grandfield for once again offering some very helpful insights for our "Business Success" audience!

Dale Willerton

Jeff Grandfield

Negotiating Commercial Leases & Renewals For Dummies

Commercial Leasing Tips for Commercial Tenants

By: Jeff Grandfield – The Lease Coach

For many business-owners, negotiating a good lease or lease renewal against an experienced agent or landlord can be a challenge. While an entrepreneur focuses on marketing and managing, savvy real estate agents and brokers are specialized sales people. Their job is to sell tenants on leasing their location at the highest possible rental rate. 

 
As explained in our new book, Negotiating Commercial Leases & Renewals For Dummies (co-written with my colleague, Dale Willerton), tenants may go through the leasing process only two or three times in their entire lifetime – yet they have to negotiate against seasoned professionals who negotiate leases every day for a living. Negotiating appropriate leasing terms is vital for an entrepreneur as the amount of rent he pays will directly affect the business’ financial bottom line.

Whether you are leasing a new location for the first time or negotiating a lease renewal for your business, these are some money-saving tips for tenants:

You are the Customer: Far too often, tenants act as if they are applying for a lease. If you want to be in the driver’s seat for the lease negotiations, you must remember who is serving whom. The tenant sets the meeting time. The landlord’s agent picks up or drops off documents to you. Shrewd tenants never pick up the restaurant bill if dining over lunch with the landlord or the landlord’s agent. You must always appear to be the buyer … and the customer never pays for lunch. 

Focus on Important Issues: We want to stress that certain issues (such as the rental rate) are deal makers or breakers while other conditions (like providing post-dated cheques) are not. You should never ignore the details but don’t get bogged down over them. Tenants frequently spend inappropriate amounts of time arguing or negotiating where it counts the least. Focus on the most important issues first and foremost and revisit them as the leasing process progresses. 

What’s In a Name? All too often, business owners are tempted to name their company after the building they occupy. While this does create instant location recognition, it also puts them at a disadvantage for initial leases and lease renewals. For example, instead of using the name, Kingsway Mall Jewellers, just call your business Kingsway Jewellers. Try to also avoid street names such as 2nd Avenue Cleaners. Leasing agents often leverage these captive tenants into paying higher rent than necessary because of the likelihood they will not choose or move away from their namesake location.
 

For a copy of our free CD, Leasing Do’s & Don’ts for Commercial Tenants, please e-mail your request to DaleWillerton@TheLeaseCoach.com.  

Jeff Grandfield and Dale Willerton - The Lease Coach are Commercial Lease Consultants who work exclusively for tenants. Jeff and Dale are professional speakers and co-authors of Negotiating Commercial Leases & Renewals For Dummies (Wiley, 2013). Got a leasing question? Need help with your new lease or renewal? Call 1-800-738-9202, e-mail DaleWillerton@TheLeaseCoach.com or JeffGrandfield@TheLeaseCoach.com or visit www.TheLeaseCoach.com.

What's been your experience?  

Feel free to add your comments and thank you in advance 

for sharing this post with those in your circle of contacts!

                                                                                          

* NEW PROGRAM: If you're looking for flexible and cost-effective Business Coaching & Mentoring, you'll like our “NEXT Steps - Program”. It's been designed with you in mind and provides 12 months of assistance that fits into your busy schedule! 

For more details see: 

"Option 3 – “PVS – NEXT Steps - Business Coaching & Mentoring Program” 

It's listed on our Website Registration page: 

CLICK HERE

Ready to Sign on the Dotted Line?

 
BEFORE you use that pen to sign anything ... you may want to read this!

We've had some great responses to the Commercial Leasing Tips that we've shared last year. 

Thank you for your feedback and for sharing this Post with those in your circles of contact, where you feel they could benefit. 

Here are some more valuable tips and suggestions from The Lease Coach that we believe you'll find helpful! And while the owner always has the final decision on matters related to their business, we've come to appreciate the value of engaging experienced professionals in order to benefit from their many years of experience!

Thank you Dale Willerton and Jeff Grandfield for once again providing these helpful insights for our "Business Success" audience!

Dale Willerton

Jeff Grandfield

Negotiating Commercial Leases & Renewals For Dummies

Commercial Leasing Tips for Commercial Tenants

By: Jeff Grandfield – The Lease Coach

For many business-owners, negotiating a good lease or lease renewal against an experienced agent or landlord can be a challenge. While an entrepreneur focuses on marketing and managing, savvy real estate agents and brokers are specialized sales people. Their job is to sell tenants on leasing their location at the highest possible rental rate. 

 
As explained in our new book, Negotiating Commercial Leases & Renewals For Dummies (co-written with my colleague, Dale Willerton), tenants may go through the leasing process only two or three times in their entire lifetime – yet they have to negotiate against seasoned professionals who negotiate leases every day for a living. Negotiating appropriate leasing terms is vital for an entrepreneur as the amount of rent he pays will directly affect the business’ financial bottom line.

Whether you are leasing a new location for the first time or negotiating a lease renewal for your business, these are some money-saving tips for tenants:

Don’t Give Post-Dated Cheques: One of the main jobs for a property manager is to collect the rent and, understandably, they prefer to have post-dated cheques. As a tenant, however, you may not have the rent money until the third day of the month. Paying a few days later is far better than bouncing a cheque. Consider if there is a recurring problem with your commercial unit’s air conditioner or the snow hasn’t been removed from the parking lot this week. By not providing post-dated cheques, you retain some control. It is often possible to modify this clause in the commercial lease agreement – or negotiate for its complete removal.

Buying a Business? It has been our experience that the average person buying a business does not fully consider the lease agreement he is taking on. For the purchaser, this is a very good opportunity to improve the situation by trying to negotiate better lease terms. All Offers to Purchase for a business should be subject to final lease approval. You can also speak with the landlord about renewal options and the purchaser’s right to eventually resell the business at a future time. You should also have a Lease Consultant review the Lease Agreement for you.

Request Proposals Be Written: When negotiating a new lease (or a lease renewal), it is most desirable that the landlord or property manager’s proposal be in writing. This creates a paper trail that you can refer back to, if needed. If you are an existing tenant, understand that a landlord may not automatically send you a renewal proposal at the end of your term. If your calls go unanswered, send the landlord a letter requesting a renewal proposal within 10 days. Without looking like you automatically intend to renew your lease, you want to know what deal the landlord expects to do well in advance.

For a copy of our free CD, Leasing Do’s & Don’ts for Commercial Tenants, please e-mail your request to DaleWillerton@TheLeaseCoach.com.  

Jeff Grandfield and Dale Willerton - The Lease Coach are Commercial Lease Consultants who work exclusively for tenants. Jeff and Dale are professional speakers and co-authors of Negotiating Commercial Leases & Renewals For Dummies (Wiley, 2013). Got a leasing question? Need help with your new lease or renewal? Call 1-800-738-9202, e-mail DaleWillerton@TheLeaseCoach.com or JeffGrandfield@TheLeaseCoach.com or visit www.TheLeaseCoach.com.

What's been your experience? Add your helpful comments and please, share this post with those in your circle of contacts!

We can help as you PLAN your Business,

and BUILD your BUSINESS PLAN!

CLICK HERE for more details from our Website!

Putting on your "Robin Hood"

I was very pleased to speak with Paul Woida, a rising talent on the Alberta Music scene and asked him for a few thoughts regarding his recent song: “Robin Hood”. Of course, the title immediately takes me back to the story of the heroic English outlaw, a highly skilled archer and swordsman who was said to have 'stolen from the rich, and given to the poor'. 


Poverty is certainly a problem, and it's one that has become increasingly more challenging in the economic downturn that we've experienced over the past year. While times are tough, I don't think that we're at the same stage as would have been experienced in the days of Robin Hood.



Those familiar with the story will know that the times were extremely difficult, with a significant disparity and polarization between the wealthy upper class and commoners. The social safety nets, variety of social services and not-for-profit agencies available to assist today were not in place at that time. Having said that, we recognize that there are still many who are in need and 'falling through the cracks' in our modern communities. And if we think that it's bad here ... we also recognize that there are places around the world where the conditions for those in need are even more desperate, and the resulting consequences even more dire.


Here's what we know:

• When each of us takes a moment to do even a little thing to help, it's another step in the right direction, and each step gets us closer to reaching our destination!
• Individual actions added together to those of others can make a difference and change the lives of many in our community and beyond.
• What seems impossible gets closer every day when each of us lends our support to a good cause.
• Find a good cause that you can support, and ask them how you can help. Is there something you could do, some way to get involved, something you could assist them with and help to make a difference. 

* And if you'd like to help Paul Woida with his cause, listen to his song "Robin Hood" and cast a vote to help him in the fight to end poverty. In fact, you can vote once a day until January 15, 2016! Yes, you'll need to make a profile but it will only take 30 seconds. (Thanks) Also, feel free to share this with those in your circle of contacts.

You can vote for Paul's music video at: http://www.myunitedwayvoice.ca/artist/76/

Paul Woida's song "Robin Hood" is at: https://youtu.be/0D5vOjgSZXU via @YouTube

Was there an actual Robin Hood? No-one really knows the true answer to that question, although there are several historic figures that were strong contenders. 

Here's what I know ... The hero in the legend of Robin Hood was someone who saw those in need and took action to provide them with assistance. That's something that any of us can do. We'd only recommend that each of us use legal and ethical means in those efforts! 

BTW - Our short video interview with Paul Woida on this topic can be seen on our YouTube Channel at:  https://youtu.be/0-jYa6gPS3E




What are some of your suggestions on how people can get involved in good causes and make a difference in the lives of others? 

Leave us a comment and we'll share it with others!

GOLDEN Commercial Leasing Tips ...

It's been said that: "All that Glitters is not GOLD."

While the prospect of a nice shiny office complex may be very appealing, there is much more that the prudent business owner will want to consider. Beware of the dangers associated with jumping into the 'trappings' of success.  The cost of keeping up appearances can be high, with some obligations extending well into the future. Does the expenditure serve the purposes for which the business was created and if taken on, will the business be able to maintain healthy operations at that level?

In working with clients, we've found that there are usually a number of areas where business owners could benefit from updates or feedback on their business plan. Your choice of location, how it meets your business needs, and more importantly, that of your target audience, should be documented in your business plan. Here are some 'golden' commercial leasing tips from our friends at The Lease Coach. We trust you'll enjoy the following guest post they've provided.

Dale Willerton and Jeff Grandfield

Negotiating Commercial Leases & Renewals For Dummies

Commercial Leasing Tips for Commercial Tenants 
By: Jeff Grandfield – The Lease Coach 

For many business-owners, negotiating a good lease or lease renewal against an experienced agent or landlord can be a challenge. While an entrepreneur focuses on marketing and managing, savvy real estate agents and brokers are specialized sales people. Their job is to sell tenants on leasing their location at the highest possible rental rate.

As explained in our new book, Negotiating Commercial Leases & Renewals For Dummies (co-written with my colleague, Dale Willerton), tenants may go through the leasing process only two or three times in their entire lifetime – yet they have to negotiate against seasoned professionals who negotiate leases every day for a living. 

Negotiating appropriate leasing terms is vital for an entrepreneur as the amount of rent he pays will directly affect the business’ financial bottom line.

Whether you are leasing a new location for the first time or negotiating a lease renewal for your business, these are some money-saving tips for tenants:

Change the Day the Rent is Due: For many small (or even medium-sized) tenants, the monthly rent represents a large portion of their overhead. Paying the rent on the first of each month may be a financial hardship as other expenses including staff payroll, loan payments, and equipment leases can also come due that same day. During negotiations, or even during your lease term, you can often request and get permission to pay your rent on the tenth day of the month (or even later!). Ask … just what have you got to lose?

Termination Clauses and Outs: A good lease agreement from the tenant’s perspective would include an early Termination Clause. Such a clause can be based on the landlord maintaining occupancy levels especially if you rely on traffic. If you are considering purchasing a franchise, early termination could be based on the continued success of your franchisor. Some business owners like to have the right to terminate in the event of personal/family illness or poor sales volume. 

Measure Your Space: Most commercial tenants lease space and pay rent per square foot. Often, the premises has not been measured properly and tenant is paying for Phantom Space (or space that is reported but does not exist). Measurement discrepancies are common and will affect your base/minimum rent but also your Common Area Maintenance/CAM costs. 

Take Time to Learn: Have you stopped investing in yourself? We know this may sound self-serving, but if you have not read our book, Negotiating Commercial Leases & Renewals For Dummies, it’s time for you to pick up a copy. Reading our book is an investment in both you and your business. 

For a copy of our free CD, Leasing Do’s & Don’ts for Commercial Tenants, please e-mail your request to DaleWillerton@TheLeaseCoach.com.

Jeff Grandfield and Dale Willerton - The Lease Coach are Commercial Lease Consultants who work exclusively for tenants. Jeff and Dale are professional speakers and co-authors of Negotiating Commercial Leases & Renewals For Dummies (Wiley, 2013). Got a leasing question? Need help with your new lease or renewal? Call 1-800-738-9202, e-mail DaleWillerton@TheLeaseCoach.com or JeffGrandfield@TheLeaseCoach.com or visit www.TheLeaseCoach.com.

What's been your experience? Please add your comments and helpful suggestions for our audience. And we'd be pleased to have you share this post with those in your circle of contacts!

* QUESTION:  Has your BUSINESS PLAN taken your location and business growth requirements into consideration? 

Pro-Vision Solutions Inc. has a number of helpful ways to add this into your BUSINESS PLAN! 

Simply CLICK HERE for more information and details from our Website!