It's time for your lease renewal. Are you ready to negotiate? If you're like many retailers, your answer is "No." But a lack of preparation can be costly. Rent is typically a retailer's second-largest operating expense after labor. And the common industry practice of adjusting staff levels to reflect a changing business environment simply won't work with lease payments. You're pretty much stuck with them once you've signed on the bottom line. It's more important than ever to negotiate a better deal in today's real estate environment, characterized by its rising prices. The higher the rent, after all, the greater the damages to profits.
"The market for retail space has changed significantly in recent years," says William D. Himmelstein, CEO of Chicago-based Tenant Advisory Group (tenantadgrp.com), a real estate tenant brokerage firm. "Across the country, there is less space available. Landlords are keenly aware of that, so rental rates are on the increase."
Continue reading this story in Beauty Store Business' August digital edition.
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