In this lesson, real estate mogul Barbara Corcoran explains why the best time to expand your business is when economic times are tough. It’s the perfect moment, she says, to lower overhead and payroll costs.
The best time to expand your business is in bad times. And let me tell you why. All your established competitors are laying low and thinking they better wait for a better time. Do you know that is the best time to be noticed, to come to the fort and jump ahead of your competition? I always did my best work in bad times because I was most creative because I had no money to spend. If you go into your marketplace and you’re the little guy and you want to catch up to the big guy up there, you‘ve got to think of a way to hop over. You can’t do it the way they’re doing it. And the best time to do it is when the market is bad because the big guys are watching their wallet. They’re protecting their money and they’ve all agreed through big committees that it’s a good time to lay low. That’s exactly the time when the individual entrepreneur can put his thinking cap on, get super creative and make a difference while everybody is laying low and sleeping.
Recruit your competitor’s best talent.
In bad times you could go to your competitor and recruit out their best people. Why? Because they’re miserable. In bad times everybody’s moaning and groaning so all you have to do is paint your happy picture as to how happy they’re going to be coming over to your shop.
Lower your overhead costs.
In bad times most entrepreneurs don’t think it’s a good time to move my office space, I better just wait it out. A perfect time. You could go to the same landlord you talked to a year ago and get the space at 35 percent off. I always move my office in bad times while rents are cheap.
Reduce your payroll without sacrificing quality.
In bad times you can underpay people and they’ll work with you. You don’t have a lot of money. You moan and groan and tell them all I love you, I love you, I love you. But I can’t quite pay you what you’re worth. You’re worth so much more. Can you work with me? They always say yes. You get your best talent in bad times.