A bad business model – how not to do business

In conversation today at my local coffee shop…

Scenario: Small centre with about 20 commercial shops and 20 businesses. The Centre Manger has walled off a whole area of the small centre to do the fit out of a bakery/cafe. This in a centre that has 9 outlets already selling coffee.

My conversation with the owner of my boutique coffee house. “They walled off this area two days out from Easter, cutting out a significant amount of space, blocking traffic flow on one of the biggest trading weekends of the year.”

The incoming tenant is investing all their capital into this venture. The likelihood of them succeeded after the fit out costs, and to stay viable with small ongoing trade,  is very slim. They are new to the business of bakery/cafe’s. Its a train wreck in the making.

This is business gone bad. The Centre Managers do not care about their tenants. They do not care about a tenant going broke. They don’t care if others in their centre struggle, or do well. They do care about getting their rent paid on time…and the legal contract to sue if they do not.

Rent. Extraction. Business where the relationship between two parties is dictated by one with only a single goal in mind. Extract. De-humanise. Or “This is business.” Or the other statement I hear…”I am a business person.” As if this label gives us some right to care less.

This is business gone bad. Who cares about the person/people on the other side of the rent agreement? No one in this game.

Is this the type of business that we want to say hell yes to? Hell no!

Instead…how about this….

The landlord cares about their tenants. They want them all to succeed. To thrive. They work to bring in complimentary quality tenants. They listen to them, pay attention to them. They say no to businesses they think will not survive in their ecosystem. The entire community of tenants do thrive, and if one falls back, work is done to get them back on their feet. Everyone wins, including the landlord.

Here is what the landlord gets if they played this game. Happy tenants, thriving tenants. Tenants who stay long term, who tell others to come to the centre, who make the job of the landlord easy. A fully tenanted centre. Tenants who complain less, pay on time…

What is not to love about this model?

Does it cost more…no…probably less in the long game. Is it good business? Hell yes…this is great business. This is the type of business people want to be engaged with.

We can change the game of business. Business for the good of all is good business.

 

 

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One Comment on “A bad business model – how not to do business”

  1. Couldn’t agree more, Christine. It’s a shame that a “business person” isn’t more open to helping others become real business people too. Sometimes telling someone “no” (No you may not lease this space b/c we have 8 other coffee merchants…) can have a positive effect.

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