How your integrity impacts your business?
How are you seen by others when doing business with them? Do they trust you and your word?
We treat our word as the most valuable asset in our business!
If we say something we REALLY mean it. Not close to…, not almost, but we mean exactly what we say.
In our search for properties, lately, we have put a LOI for a 9 unit building in Chicago. during our due diligence we understood that there is much more work to be done on this property than we have anticipated at the beginning. There were extensive renovations that were required in the units as well as some cracks in the basement that required attention.
After we got all the bids we have asked the seller (bank in this case) to get credits on the difference between our initial estimations and the updated ones. The difference was around $100,000. During the negotiations the seller reduced the price by $20,000 but it was not good enough for us.
We told the seller that we will not be able to proceed with this transaction and at that point they have asked us to provide our final and best offer. After checking the numbers again and again, our FINAL and best was $85,000 lower (instead of $100,000) from the price that was there in the contract.
The seller rejected our offer and we have canceled the contract.
A month later, the seller approached us again asking if we are still interested to buy the property. They have told us that they would like to close by the end of the year in order to write it off their books this year.
They also told us that they must get a higher price on it ($10,000 over our final and best) since if the price will drop below a certain level, they will need to have another authority in the bank to approve it and it might take some time or not approved at all.
Our reply was very simple – we already provided our final and best, our price didn’t change. We don’t want to waste your time and please don’t waste ours if you don’t want to sell in this price, was our underlined message.
In our eyes integrity is a key factor in our business success.
Currently, we have the property under contract with the price we have put as our final and best.
This story is a repetitive one. We have acquired at least 3 properties that followed the same scenario until today…
We know that in many cases when we are doing business, we think that we need to keep buffers which is totally understood. But when you are asked for a final and best, please give your FINAL and best.
By doing that, you will educate your business counterparts that you are a man/women of your word.
If we will all do that, we can change the way business is conducted and it will be for the benefit of all of us.
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