Boy that’s a dozy of a title isn’t it? Being able to make a deal and negotitate is a very important skill, it is even more important during a crisis moment for a business. This is the time where we find out what we are made of. Steel or Jello, you get to decide.
Today is a day where you should make a deal with the biggest costs of your business, it is most likely your Land lord’s rent, Employee salaries and product suppliers.
Understanding where people are coming from is one of the most important things when you are going to negotiate something. Keep in mind that doesn’t mean you always need have empathy for their position. But you should be aware of it. For the psychopaths around here, I will tell you what these three groups are feeling right now to help you understand how best to position your points, with the main goal of being to SAVE YOU MONEY NOW.
Your Landlord
Your landlord wants rent, and doesn’t want to have to spend their own money on anything. That is the main position of most landlord. Your landlord is worried that you might not be able to pay rent, and that you will go out of business. The Landlord might have to renovate the property after you leave, which will cost them money. Your landlord is also worried they wont be able to find another tenant if you leave. Nobody knows what is going to happen right now, including your land lord.
What you can do
Are you familiar with the term, “Straight talk”? You need to explain to your landlord what your situation is. I.E. “My business will be generating no money until the government allows me to reopen the business.” Then you need to explain to them how they can help. If there is a government program that they can sign up for, ask them to do it.
After you have explained your obvious problems, it is time to tell your landlord what you want, These options would be different depending on your situation, but you could ask for deferred rent, a rent reduction for a period of time, an “AT COST” Rent, as in you cover the cost of holding the property, but not any rent that includes the profits the landlord makes off you each month. None of these options will look very good to a landlord, but compared to having to spend their own money, or risk losing money. IT might not look so bad.
And try to be nice about it, don’t cry to much over the phone ok?
Your Employees
Your employees are scared, everybody is scared. They are worried about themselves mostly, are they going to be safe and able to make income during this whole crisis? On some level they might be worried about your business, and hope that it survives because maybe they like you and they like working at the business. Employees are of course inheritly selfish, not all of them of course. Some are very nice, but as a whole they like to “look out for #1”. Most employees don’t realize in the best of times that you are the one in power of the business, and especially now you have more control in how things are run then they realize.
What you can do
Employees need to understand what is happening in the business. If you are unable to run your business you should obviously layoff your employees temporarily as soon as possible. If you are fortunate and your business can run, even in a dimished capacity. Then you should ask your employees to volunteerly take a pay cheque or a reduction of benefits, commissions or other things that cost your business money.
There are no catered lunches when your business is going under water. If the employees don’t step up to the plate, I would recommend laying off those ones first. Let them understand once business comes back to normal you will be returning them to the previous level. (although there might be a few less of them at the end of the day, lets be honest as of how things look in May 2020)
Your suppliers
Your suppliers have the same problems you do, so you should be able to apperiate what they are going through. They are worried about paying their rent, paying their employees, paying their suppliers. But at the same time they want you, and need you. Even if you aren’t selling much today, they rightly assume you will be selling stuff at some point in the future.
What you can do
I would call up the suppliers and inititally “Shoot the shit” as the more crude amoung us calls it. They know what you are going through. They might offer you a deal right off the bat. Ask them if they have any products that might be able to help you and your business in the future (Lysol wiped anybody?)
Afterwards I would ask for better terms, atleast temporarily. Ask maybe to move a net 30 day order, to a net 90 or net 120 days, They want to get paid, but they might be in a better position then you are, why not take advantage?
Maybe they are having a fire sale, or deep discounts right now, as their business is also suffering? If they are selling a product you can eventually sell, maybe your in position to take advantage? Who knows. Just remember you want to keep them on your side.
Conclusion:
During this difficult time, it feels like there is nothing you can do. That is wrong. This is the time where you need to do something, anything to help your business survive. Nobody said this whole business thing was going to be easy did they? Unfortunately business isn’t just about relaxing at the beach and raking in the money while your employees do all the work. Although sometimes you can get there, if you are lucky enough! Just where is the picture of me at the beach, before the world economy collapsed? Anyway it doesn’t matter. The important thing is you can do something. So why don’t you do it?
Your friend,
Rich. E Cunningham.