How CRE Brokers Help Businesses Scale

Commercial Real Estate brokers are an important part of your plans to scale.

Today, it seems that everywhere you look, there is a startup or new business launching. According to research, however, 90% of startups fail—with 21.5% of startups not making it past the first year. The reason? In many cases, a lack of funding.

Because of this, the ability to successfully scale your business has become more important to company leadership every day. Scaling a business takes time and effort, and commercial real estate brokers know its ins and outs.

In order to succeed, a company needs to produce satisfactory results without spending an exorbitant amount. Scaling means having the capacity to support exponential growth in your company—but it’s not that easy.

Growth versus Scaling

First things first: What is the difference between growing and scaling a business? The two, contrary to common use, should not be used interchangeably.

The difference between the two, however, is simpler than you might think.

Growth is when a company is “increasing their revenue equally as fast as they are adding resources to enable that increase,” according to Lighter Capital. This startup finance blog uses the example of a company that might have gained $50,000 in new revenue, but only as a result of hiring a new employee—whose salary is also $50,000.

In this case, their gains and losses are the same. So, while the company might be “growing,” everything ultimately balances out and there isn’t too much to show.

Scaling, however, is a different story. When you scale a business, revenue is being generated more quickly than you’re spending it. In other words, your gains outweigh your losses. Lighter Capital paints the picture like so: a company gains $50,000 in revenue but only spends $5,000 on the marketing automation tools that produced said revenue.

If your company is focused on growth alone, at some point, the financial spend won’t be worth the time and effort. Scaling, for obvious reasons, is the preferred goal of most businesses.

Over time, the idea of scaling a business is something that company leadership has become obsessed with—and for good reason.

A company reaps the benefits with little to no expense or investment. This is why, for example, email marketing is a great tool to quickly scale a business. The cost for efficient email marketing is low-tier in comparison to hiring an additional employee, and the reach is significant. Scaling implies exponential growth.

Do I Need A CRE Broker?

Let’s face it – it can be intimidating to hire a commercial real estate broker. In many cases, people think that by not hiring a broker, they’ll save time and money. However, quite the opposite is the case. Finding the perfect commercial property is a step that, for many businesses, launches their scaling efforts.

Here are some additional benefits to hiring a commercial real estate broker of your own.

Save Time and Money

We all know the famous adage “time is money.”  Finding the perfect commercial space for your business doesn’t happen overnight, and with every second that passes, your losses increase, and your opportunity to scale decreases. Brokers have access to database information, are experts in negotiation, and work to understand precisely what you’re looking for.

Industry Knowledge

Did you know that not all listings are available to the public? Brokers have the highest access to information including property comparables and work frequently with property owners, developers, investors, and tenants. Commercial real estate brokers have access to timely, accurate market data and are experts in their local industry.

Accessibility

Short and sweet: Brokers have access to a network of connections, resources, data, and tools that the Average Joe wouldn’t.

Being Taken Seriously

Chances are with a commercial broker by your side, you’ll be taken more seriously in your property search. Without representation, property owners might classify you as a “Lookie-loo.” Hiring a broker sends the right message to property owners—that you’re serious.

Don’t Waste Your Energy

Making the decision to hire a commercial real estate broker is important and often serves as the catalyst for a company that successfully scales.

At Voit, we are in the business of helping people, whatever that may look like. As you or someone you know launches or maintains a business, they should be focused on their scaling strategy, as it takes time, money, and resources to sustain constant growth.

We recognize that increasing revenue while simultaneously increasing expenses is a long and hard uphill battle, one where many companies plateau. At Voit, we provide creative solutions that create value for our clients and their commercial real estate goals. Contact us today to find out what Voit can do for you.