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When negotiating to make a deal - NUMBERS TALK
Want to do more deals?
Get creative in how you structure pricing
Here's a real life example that you can use to increase your sales
-(THREAD)-
Want to do more deals?
Get creative in how you structure pricing
Here's a real life example that you can use to increase your sales
-(THREAD)-
I am working a lease for one of my industrial clients
We have gone back and forth with the building owner multiple times, and finally just agreed to a deal
This took a lot of back and forth
Here's how it went:
Owner wanted $9.65 per SF for building
We offered $8.50 per SF
We have gone back and forth with the building owner multiple times, and finally just agreed to a deal
This took a lot of back and forth
Here's how it went:
Owner wanted $9.65 per SF for building
We offered $8.50 per SF
Owner responded with $9.35
We came back at $9 (to meet in the middle)
This is where it got tricky
This building is 90,000sf
$9/sf was the top of the line for my client, so I had to make something happen
The owner wouldn't agree to $9, his bottom line was $9.25
We came back at $9 (to meet in the middle)
This is where it got tricky
This building is 90,000sf
$9/sf was the top of the line for my client, so I had to make something happen
The owner wouldn't agree to $9, his bottom line was $9.25
I started running numbers and found a solution that would appease the owner and also my client
I presented this offer
$9.25/sf but we get the first 2 months of the lease FOR FREE
This gave the owner the price per SF that he wanted
Now I had to sell it to my client
I presented this offer
$9.25/sf but we get the first 2 months of the lease FOR FREE
This gave the owner the price per SF that he wanted
Now I had to sell it to my client
This is a 5 year lease
90,000sf X $9.25 = $832,500/year X 5 yrs = $4,162,500
90,000sf X $9 = $810,000/year X 5 yrs = $4,050,000
Difference of $112,500/year needed to be made up
1 month of rent for the $9.25 deal = $69,375
Multiply by 2 (2 months free) = $138,750
90,000sf X $9.25 = $832,500/year X 5 yrs = $4,162,500
90,000sf X $9 = $810,000/year X 5 yrs = $4,050,000
Difference of $112,500/year needed to be made up
1 month of rent for the $9.25 deal = $69,375
Multiply by 2 (2 months free) = $138,750
See where I'm going?
The 2 months of free rent saves my client $138,750
The $0.25/SF difference in lease rate to meet the owners demand will cost my client $112,500
$138,750 - $112,500 = $26,250 saved by my client over 5 years
The 2 months of free rent saves my client $138,750
The $0.25/SF difference in lease rate to meet the owners demand will cost my client $112,500
$138,750 - $112,500 = $26,250 saved by my client over 5 years
The owner needed to get $9.25/sf because that is what the bank required per the terms of his loan
My client needed to stay at $9/sf for budgeting purposes
The bank was fine that the owner gave up 2 months free, all they cared about was the dollar amount per month
My client needed to stay at $9/sf for budgeting purposes
The bank was fine that the owner gave up 2 months free, all they cared about was the dollar amount per month
A lot of deals will run into an issue like this
A gap in pricing between the buyer & seller that seems at first like it can't be overcome
You have to get creative
Play with the numbers
Microsoft eXcel should be your best friend as a salesman
A gap in pricing between the buyer & seller that seems at first like it can't be overcome
You have to get creative
Play with the numbers
Microsoft eXcel should be your best friend as a salesman
My client is ecstatic
The owner is very happy
I am very thrilled
This is what needs to be done to close high ticket sales
Not every deal will be a 'walk in the park', problems will come up
You have to get creative and overcome obstacles
Let me know how this works for you!
The owner is very happy
I am very thrilled
This is what needs to be done to close high ticket sales
Not every deal will be a 'walk in the park', problems will come up
You have to get creative and overcome obstacles
Let me know how this works for you!
