The older I get the more I've learned that there are more than one way to get what you want. I think that a majority of people, at least a good amount of people who I've encountered over the years tend to see deals, transactions or even job offers as a linear trade.
You assume that you need to produce A to get to B, but like most math problems, there tends to be multiple ways to get to the same conclusion.
A few years back my friend Meghan took me out to dinner and wanted my advice. She had received a job offer to work at her dream job, but they wanted her to relocate 4 hours away to their Atlanta office. She felt torn because it meant that she would have to move away from friends and family.
My advice to her is advice I often give people in a similar hard place. Find a way to do both. Just because those options are presented to you, doesn't mean you need to conform to get the results you want. In her case, she just needed to convince her employer to either A) create the position for her in Savannah, or B) allow her to work remotely from home. Fast forward a year, she managed to get both, by offering a pay cut and promising to exceed projections.
Another example is quite recently as my sports business starts to reopen. We lost our gym space and have been on the hunt for a new location. Being that I'm in no position to build my own gym, my options tend to be pretty limited.
Recently I found a beautiful gym at a local high school. When I reached out to the gym, they told me that they were interested in renting to us, but their rental rate was $150 per hour. Thats a pretty size-able increase from our last location which was charging us $15 per hour (10x more expensive).
So, trying to find a way to solve my problem of A to B, I came up with multiple solutions.
- I could raise the membership fees to cover the cost. I figured this is everyones most obvious solution, but the problem I understood with this is that A) raising the fee would lower the volume of sign ups and B) I understand my market and I know that raising the fees any higher would push the league out of the affordable range of my customer base. This option was basically thrown out immediately.
- I could negotiate their rate down to a rate that would be affordable for us. I created an excel document and projected a dummy season and played with my income and expenses to figure out how I could make it work. I realized if I had at least 8 teams sign up, I could still make money if the rate was $70 per hour, so I would try to negotiate down to $50 per hour. The problem with this solution is the minimums needed. I've learned already that when starting a new program, it takes a while to build the brand. Early seasons of any new program see small sign ups in the beginning.
- Then I remembered on the phone they mentioned that the gym wasn't a revenue source for them. He admitted the money was used to just "upkeep" the gym. So at a rate of $150 per hour, they had a bunch of vacancies during the week. So I presented him with Option #3 which was asking them if we could donate 50% of our proceeds made from any league at the gym.
Option #3 was our sweet spot. Comparatively, at 8 teams, 50% of the proceeds came out to about what we would've paid for the gym at $70 per hour, so to the gym, the deals were almost identical. But for us, this meant eliminating our minimums. We could have 4 teams in the league and still be net positive.
With Option #3, in no scenario would we be setup to lose money which eliminated any risk we might've had. Plus, the gym benefited because it filled empty time slots and made money in scenarios that probably wouldn't have existed.
I think for most people in this scenario they hear $150 per hour, realize that's not what they can afford and move on. I know for a fact that the person I bought the business from did exactly that.
At the end the of the day currency is essentially a structured system for bartering. So find other ways to barter for what you need. Whether that be your services, offering goods or manipulating money in the form of royalties, payment plans, etc.
Heck sometimes just betting on your confidence is effective enough. "I promise if you let me do A, I'll provide you with B".
Just remember that all good deals require a compromise on both sides of the deal. Put yourself in their shoes first and present the deal in a way that also accomplishes the goals of the other parties.
I use this concept almost weekly in my everyday life. It applies to so many things. Think outside the box and learn the be creative to accomplish the things you want in life.
Subscribe For Weekly Updates
Delivered to your inbox every Monday at 2:00pm EST