Small business retail advice on how to negotiate with your landlord

If you want to reduce the rent you pay for your retail shop, you need to make a compelling business case to the landlord.

Wanting a reduction is not enough. You need to make a fact-based case.

This is general advice only. We are not lawyers. nor are we registered lease consultants. The advice here is based on personal experiences of dealing with landlords for decades in high street and major shopping centre situations.

We have negotiated for ourselves many times and have used a professional lease negotiator on three occasions. We found that we were more satisfied when we did it ourselves. While the negotiators were nice enough, we were never certain that they put our needs ahead of their relationship with the landlord. In one instance, we felt like we paid them to soften us to agree to terms we’d later be unhappy with.

Here is what we suggest retailers put together when negotiating for themselves:

  1. Current profit and loss (most recent year or to the end of the most recent quarter) compared to the same period a year earlier.
  2. Sales comparison for a recent period (more than three months) to the same period a year ago. This will ideally include a transaction count comparison.
  3. Details of every step you have taken to improve traffic and sales, including external marketing and costs associated with each activity. Assemble this in a spreadsheet. This is important, as it shows you’re doing all you can to attract shoppers and maximise opportunities. This makes your case
  4. Itemised
  5. Numbered
  6. Provable.
  7. Details of steps you have taken to manage costs. Again, show that you’re professional and thorough in your approach to your business.
  8. Changes made to the business over the last year. Assume your landlord has not been to the shop and seen the work you have undertaken.
  9. If possible, comparisons with other retail businesses—this demonstrates an understanding of how you compare, especially if it shows you as doing better than most in key parts of the business.

Take your time. Be thorough. The more complete and more professional your documents are, the more notice will be given to your request for assistance.

Once you have this information together, look for a narrative, a story, which supports the proposal you make to the landlord.

By narrative, we mean a case, a story, the reason, to justify your request. The data you have gathered will/should support this.

The clearer a narrative is supported by the data, the better the chance of a positive hearing.

It’s not enough to say you want a better deal, a discount on rent or some other relief. Landlords get that all the time. Your request needs to come with something for them. Be specific and ensure you have the data necessary to justify your claim.

If your financials show your profit’s stable or improving, your case will be hard to make.

If profit’s falling, your case is easier. Don’t manufacture figures to suit your case, though. Look at the accurate data and listen to what it tells you.

If your financials show profit declining or you making a loss, consider what you actually want as a result of this.

Too often, retailers go to a landlord with a problem and not a solution. Work on your solution and use the information you have gathered to justify the solution to your landlord.

The best person to pitch a landlord for assistance is the business owner. While I understand the appeal of hiring someone to do this for you, my recommendation is that you do it yourself.

Put your proposal in writing. Keep it brief and to the point. Focus on facts. Attach the evidence to which you refer. Outline what you want and why, without emotion or accusation. Consider explaining what it would mean if you did not achieve what you wanted. Keep emotions out of this.

Usually, a landlord will want a meeting. Ensure there is an agenda. Go with prepared notes and your evidence. Don’t get side-tracked. Don’t engage in emotive arguments.

Your sole focus ought to be on the outcome you want and the evidence you have that supports this outcome.

Keep your emotions to yourself through the whole process of seeing a better rental outcome. While the situation may feel stressful, exposing your emotions to the landlord is unlikely to help advance your case.

The best position to be in when negotiating with your landlord is to be running a shop they like, a shop they want to keep in the tenancy.

Small business retail advice: how to respond if locals are not buying from your local shop

Local means different things in different situations. It could be products made in your town, your state or territory, or in your country. What is local will vary depending on what you sell.

If you’re certain locals are buying elsewhere instead of from you, find out why, as this is key to what you do to turn the situation around.

Before we get into the why and what you could consider doing about it, think about how local your business is and why you think locals should support you. Gaining local support starts with you supporting locals.

If you buy products from makers who live locally and shop in town, talk about that and how grateful you’re to have their products. Create a small sign to place next to their products. Include their photo. This personal touch helps shoppers to understand who else benefits from their purchase.

If you source products from within your state or country that nearby competitors and online businesses source from overseas, talk about how pleased you’re to find local suppliers, how that makes you feel, and what it means in terms of the products.

Look at every product or service you use in your business. Talk about each one that is locally sourced; show that it’s locally sourced. Consider local alternatives for those sourced from overseas.

Look at your engagement with local community groups and clubs and with the local community as a whole. Is it as good as it could be? Is it consistent? Is there a place in the shop where your local community group support is shown?

Does your business attract people to the area? If there are things you could do to attract people, do them and get known for doing them. Get locals pleased that you’re bringing more people into the area.

The more you walk the local walk, the more you can talk the local talk.

Stop telling people to shop locally. Show them. Think about what you source locally for your business and discuss it on social media and in your shop. This is an excellent way to demonstrate being local.

Getting local shoppers shopping locally really does start with you and how locally focused your own decisions are.

Educate shoppers to be inquisitive about identifying local products. Show them how to read a label to see if a product is locally made. Sometimes, people need to be shown how to shop locally.

Now, let’s consider why locals may not be supporting you.

If shoppers prefer online shopping, it could be price or convenience. If shoppers prefer a big competitor, it could be range or price. If shoppers prefer shopping in the next town, it could be price, range and/or convenience.

Addressing price, convenience and range can feel challenging in local small business retail. Let’s have a crack at it.

Price comes down to value. If you sell products that benefit from knowledge you can share that nearby or online competitors cannot or don’t share, that’s your competing price. Demonstrate your value at every opportunity and hope that your shoppers will talk to others about it.

Convenience could be parking out the front, your opening hours, nearby shops and/or whether your business is online. If you’re not online, get online; that is an easy step to address. Other convenience factors rely on local amenities and fellow local retailers.

If range is the reason that locals tend to shop elsewhere, your pitch comes back to the value proposition. It may be that you have the best, most useful, longest-lasting products, and that’s why your smaller range is beneficial to locals.

Our point here is that if you’re unhappy about support from local shoppers, your decisions and the narrative you pitch in and around your business are key factors.

You need to help locals understand why shopping locally with you is good for them.

newsXpress is a marketing group that supports small local independent retailers to thrive. Find out more at help@newsxpress.com.au.

Small business retail advice: if you are time poor or feel time poor, this is for you

A retailer colleague said they missed a significant deal opportunity because it came in by email, and they don’t have time to read emails.

Every day, we choose how we spend our time in our businesses. It’s on us if we miss an opportunity that has been pitched through a regular business communication channel like email.

Often in retail, being time poor is a choice.

While having enough hours in the day can be challenging, there are steps we can take to save time:

  1. Before you spend time on something, ask yourself if it has value. Being busy doesn’t always equal value.
  2. Prefer suppliers who save you time, like those who provide electronic invoices for stock and those who use digital forms rather than paper. Let your suppliers know that you will give preference to those who save you time.
  3. Eliminate manual paperwork. Use your software to track all sales, manage end-of-shift balancing and feed data to your accounting software.
  4. Make better use of technology. Review everyday processes like stock ordering. See whether your existing technology could save time doing this work.
  5. Stop doing stuff. First, for a few days, write down everything you do. Then, review the list and stop doing things that are not genuinely valuable for the business.
  6. Eliminate manual processes at the sales counter. Scan all items sold. Have your point-of-sale software integrated with your EFTPOS terminal. Eliminate double data entry.
  7. Manage time spent with sales reps based on the financial return for the business.
  8. Make it easier for shoppers to shop in your store. Better signs with products can answer questions that people might otherwise want you to answer for them. If you save time for shoppers, you save time for yourself.
  9. Create task lists to systemise regular tasks such as shop open, shop close, daily cleaning, stock pricing and more. Having written processes can make them more efficient.
  10. Give someone the authority to complete a task and let go.
  11. Ask everyone working in the business for ideas on time-saving. They may see opportunities you’re missing.
  12. Finish each day by writing a to-do list for the next day.
  13. Start each day by completing tasks on your to-do list.
  14. Maintain a list of if I have time tasks you can do if you have spare time. Without such a list, you could lose time thinking about what you could do.

Time is an asset that needs to be managed as such. Each packet of time you spend on something in the business needs to serve the goal of the business and add value to it.

Some business owners like to feel time-poor because it gives them a feeling of being busy and having value. Being busy doesn’t always equal value for the business.

Let’s circle back to the colleague who missed the opportunity sitting in their inbox. By implementing even a few of the steps we suggest, they wouldn’t just be “finding time” to read emails; they would be making time. Effective time management is about creating robust processes that allow the business to function efficiently without constant, frantic intervention. It’s about building the necessary bandwidth to see the opportunities that are already there and, crucially, having the capacity to act on them.

Our advice: don’t work to be time poor.

newsXpress is a marketing group that supports small local independent retailers to thrive. Find out more at help@newsxpress.com.au.

Small business retail advice: If people annoy you and your job is dealing with customers on the shop floor

If people annoy you and you work in retail where interacting with people every day is part of the job, this small business retail advice is for you.

But first, a disclaimer. This is personal advice, opinion really. We’re not psychologists. The advice for small business retailers that we offer here is based on years working in retail and helping small business retailers. So, let’s get into it, here’s our advice if people annoy you and your job is dealing with customers on the shop floor in local retail or small business retail.

There are everyday situations in retail that can trigger someone working in the shop:

  • The person who picks an item up from its usual location and puts it down where it doesn’t belong.
  • The person who checks the price of each item in a range to see if there is one priced incorrectly so they can challenge it.
  • The person paying by cash who digs deep into their pocket or purse to find exact change while others wait behind.
  • The parent who drops their kid off at your shop while they go elsewhere to shop alone.
  • The person who brings back a product they purchased weeks ago to ask for a discount since that product is now on sale.
  • Those who always point out things they think you should do in the shop.
  • Those who point out what has been done wrong and never what has been done right.
  • Those who have never shopped with you asking you for a donation to their community group.

Everyone’s an expert, right?!

There are trigger opportunities in retail every day. If you’re not a people person, it can be challenging. It’s important to practice a safe response to the point that it’s automatic when a trigger situation arises.

If the trigger events are common, consider what you can do in the business so the triggers don’t occur.

In terms of preparing yourself, get a set of clothes that you wear only to the shop. Think of them as a uniform and that once you don them, you’re in character, a character that is not you. It could be that this character has a completely different personality.

The alternative is that you respond to each of these triggers, which is likely to have a negative impact on the business.

You can’t control the behaviour of every person who walks through your door, but you have absolute control over your response.

Treating your role as a performance and your work attire as a costume creates a professional shield, separating personal feelings from business operations. This isn’t about suppressing who you are, but rather channelling your energy into a consistent, professional approach that protects your own well-being and, most importantly, the reputation and success of the business you work so hard to build.

newsXpress is a marketing group that supports small local independent retailers to thrive. Find out more at help@newsxpress.com.au.

Small business retail advice: Your people are your difference: customers buy people first

It’s human nature. In every purchase, we buy people before we buy products. In a shop, as much as online, trust is at the core of each transaction, trust in the advice provided and that what you buy is what you will get.

Today our advice for small business retailers, local retailers, is embrace the personal, leverage this as a point of difference.

Trust is nurtured by a smile, openness, how we present ourselves and the value of the information we share.

Investing in people matters. Retail is personal, after all. Think about it – if you sell what I can buy online, why would I go to your shop rather than shop online if the purchase is not urgently required and if the price online and yours are similar? For local retail, often it is the people interaction.

It starts with hiring well, by hiring people you trust. If you’re not sure about a candidate, don’t hire them, no matter how desperate your need.

Train well and often, regularly checking in with your team and how able they feel they can satisfy your customers. Offer training about the products you sell as well as from a broader professional development perspective for those keen to develop their skills.

Pay well, as it’s the most understood measure of value. Big retailers pay based on a regulated award or an enterprise-wide agreement and rarely based on one-on-one negotiation with an employee. You can pay reflecting how much you value an employee.

Welcome employees purchasing what you sell and make it easy for them to do this. If they have experience with your products, they will be able to speak to that when dealing with customers.

Look at each shopper touchpoint in your business to ensure they nurture trust: on the phone, as shoppers enter the business, on the shop floor, at the sales counter. It’s in each of these interactions that you can demonstrate a point of difference for your business.

If you have a competitor nearby, the people working in your business can be the differentiator shoppers prefer.

This differentiation is not just a ‘nice to have’; it is a tangible commercial asset.

A shopper who trusts your team is less price-sensitive, more receptive to upselling or new product recommendations, and fundamentally more loyal.

They return because of the experience, not just the product. The investment you pour into hiring, training, and valuing your people pays for itself by building a loyal customer base that online algorithms and impersonal competitors simply cannot steal.

newsXpress is a marketing group that supports small local independent retailers to thrive. Find out more at help@newsxpress.com.au.

Small business retail advice: How to partner with local community groups to win new shoppers, increase sales and support your local community

Talk about a win, win, win. This tip helps you win new customers for your local retail business. Your customers save money, and a local community group raises funds. Engagement is measurable, so you can assess the return on your investment.

This retail advice is all about supporting the local community, to encourage them to support your small business.

Find a locally loved and trusted community group in need of funds, a group that has a reasonable number of members who don’t currently shop with you.

Offer the community group a percentage from each purchase made by members of the group and their family members.

Offer each member a discount for each purchase.

The amounts offered need to be considered in the context of your business, your margin and the value of the anticipated additional purchases.

Consider a timeframe for the offer. For example, it may be useful to trial the offer for a limited period so you can assess engagement and then adjust as appropriate. It may also be an offer only open to certain days of the week, your quietest days.

Consider the products to be included in the campaign. It may be appropriate to exclude product categories where your margin is not enough to justify inclusion.

To manage the offer, see if your point-of-sale software can help. I know the software from my own software company can manage this. You give each community group member a card, which, when scanned, ensures they get the discounted price and that the donation to the community group is tracked.

The card becomes valuable itself, something talked about, something sought after.

The commercial goal of this campaign has to be to net new shopper traffic for the business and deliver revenue the business would otherwise not have achieved. If this is the case, a discount off the usual margin achieved is acceptable as it’s effectively a cost of acquiring the additional business.

Key to the success of this campaign is the active engagement of the community group in rallying members to visit the shop, to encourage them to support you so that you support the group they love.

Make an event of handing over the donation to the community group. Get photos. Talk on social media about being grateful for the local support that has enabled you to make the donation.

Share stories on social media about the activities of the group, as your support of them can encourage their support of you.

We love the campaign outlined here, as it represents the circular nature of the local community: people living locally, shopping locally, enabling local shops to thrive and supporting loved local community groups.

newsXpress is a marketing group that supports small local independent retailers to thrive. Find out more at help@newsxpress.com.au.

Small business retail advice on negotiating with your shop landlord

Negotiating with your landlord can be stressful and challenging. Some landlords make it particularly difficult. Lawyers representing landlords can be argumentative, they can block even reasonable requests.

Then, there are landlords who are a dream to deal with and who support your business. If this is your situation, love it for what it is, appreciate it.

The most common situation for a small business retailer in dealing with a landlord is when it is time to negotiate the rent.

If you want to reduce the rent you pay for your shop, you need to make a compelling business case to the landlord.

Wanting a reduction is not enough. You need to make a fact-based case.

We have negotiated for our shops many times and have used a professional lease negotiator on three occasions. We found we were more satisfied when we did it ourselves. While the negotiators were nice enough, we were never  certain that they put our needs ahead of their relationship with the landlord. In one instance, we felt like we paid them to soften me to agree to terms I’d later be unhappy with.

Here is our advice for small business retailers for negotiating with their landlords for themselves. Gather what you need:

  1. Current profit and loss (most recent year or to the end of the most recent quarter) compared to the same period a year earlier.
  2. Sales comparison for a recent period (more than three months) to the same period a year ago. This will ideally include a transaction count comparison.
  3. Details of every step you have taken to improve traffic and sales, including external marketing and costs associated with each activity. Assemble this in a spreadsheet. This is important, as it shows you’re doing all you can to attract shoppers and maximise opportunities. This makes your case
  4. Itemised
  5. Numbered
  6. Provable.
  7. Details of steps you have taken to manage costs. Again, show that you’re professional and thorough in your approach to your business.
  8. Changes made to the business over the last year. Assume your landlord has not been to the shop and seen the work you have undertaken.
  9. If possible, comparisons with other retail businesses—this demonstrates an understanding of how you compare, especially if it shows you as doing better than most in key parts of the business.

Take your time. Be thorough. The more complete and more professional your documents are, the more notice will be given to your request for assistance.

Once you have this information together, look for a narrative, a story, which supports the proposal you make to the landlord.

By narrative, we mean a case, a story, the reason, to justify your request. The data you have gathered will/should support this.

The clearer a narrative is supported by the data, the better the chance of a positive hearing.

It’s not enough to say you want a better deal, a discount on rent or some other relief. Landlords get that all the time. Your request needs to come with something for them. Be specific and ensure you have the data necessary to justify your claim.

If your financials show your profit’s stable or improving, your case will be hard to make.

If profit’s falling, your case is easier. Don’t manufacture figures to suit your case, though. Look at the accurate data and listen to what it tells you.

If your financials show profit declining or you making a loss, consider what you actually want as a result of this.

Too often, retailers go to a landlord with a problem and not a solution. Work on your solution and use the information you have gathered to justify the solution to your landlord.

The best person to pitch a landlord for assistance is the business owner. While we understand the appeal of hiring someone to do this for you, our recommendation is that you do it yourself.

Put your proposal in writing. Keep it brief and to the point. Focus on facts. Attach the evidence to which you refer. Outline what you want and why, without emotion or accusation. Consider explaining what it would mean if you did not achieve what you wanted. Keep emotions out of this.

Usually, a landlord will want a meeting. Ensure there is an agenda. Go with prepared notes and your evidence. Don’t get side-tracked. Don’t engage in emotive arguments.

Your sole focus ought to be on the outcome you want and the evidence you have that supports this outcome.

Keep your emotions to yourself through the whole process of seeing a better rental outcome. While the situation may feel stressful, exposing your emotions to the landlord is unlikely to help advance your case.

The best position to be in when negotiating with your landlord is to be running a shop they like, a shop they want to keep in the tenancy.