The value of competition

In the world of selling hotels (or selling anything else.) nothing replaces the value of competition. Every buyer of anything will tell you they want an off market (noncompetitive) deal, but they really don’t. Whether you are buying a house, car or a hotel, there is great value in you knowing there are other buyers ready to step in. It forces you to make the decision to either buy it or past it up. No one will say this out loud, but they need to know other people want it as bad as they do, which in turn validates the value in their minds.  

The worst thing you can do in real estate is work with one buyer. I have experienced this many times. If that one buyer believes he/she is the only buyer, he/she will never stop trying to sweeten the deal one nickel and dime at a time. The reason is they think they are in control and are the only ones interested in the deal. Therefore, competition is always needed.

When we get a hotel under contract, we continue to market a hotel until all the contingencies are satisfied. In fact, we ramp up the marketing to demonstrate to the current buyer that there is competition. When a buyer threatening to back out of a contract, the best words you can say is, “I understand, and we wish you the very best on another deal.” This always catches the buyer off guard because he expects you to begin explaining how great the deal is and why he should buy it. What he doesn’t expect you to do is say, ok.

When I purchased my truck earlier this year (don’t laugh) there we no less than four other men standing in the lobby ready to buy it if I didn’t. Say what you want, but the fact that four other people were ready to buy it, made me want it even more. Therefore, auctions work so well because there is always competition wanting the same deal. Even buying or selling something on eBay is exciting for the same reason.

In life, people sometimes don’t want what they already have until they realize they might lose it. KT  

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