While it is certainly important to provide a valued product or service to the public, it’s perfectly understandable that a major focus of any business is the bottom line. Whether you run a small business or a large corporation, you need it to be profitable and make money on a consistent basis. However, you need to expand your perspective beyond the short term.

To best illustrate this, let’s go through a rather typical example. A property management company signs a lease with a new tenant for a period of one year. The tenant is happy with the situation, but circumstances change and she needs to move out earlier than the lease expiration date.

Under the letter of the law, the property management company is owed the remainder of the lease and the tenant is liable for that cost, even if there is time remaining on the lease. Looking strictly at the bottom line, it is the company’s best interest to collect the entirety of the lease. However, the tenant will not be as pleased with this conclusion.

Under these circumstances, it may be valuable to make a fair and reasonable concession to the tenant. If there is two months left in the one-year lease, for instance, they can compromise in saying that the tenant must pay for one of those months. The tenant will be happier and is more likely to give a positive recommendation to future prospective tenants, helping the long-term success of the property management company.

What do you think? Should the property management company stick to its guns and demand the entirety of the lease money or should it be willing to make a concession to the current tenant?