WEBVTT - Barbara Corcoran Talks Small Business Outlook 0:00:00.240 --> 0:00:04.359 Small business owners are both optimistic and uncertain, the NFIB 0:00:04.600 --> 0:00:07.880 Optimism index rising for a fourth straight month to its 0:00:07.920 --> 0:00:11.160 highest level since February of twenty twenty two. At the 0:00:11.200 --> 0:00:15.480 same time, the Uncertainty intex index also continues to climb. 0:00:15.520 --> 0:00:18.120 Let's get a read on how business owners feel across 0:00:18.160 --> 0:00:20.840 the country. Joining us now is Barbara Corkoran, the founder 0:00:20.880 --> 0:00:23.680 of the Corcoran Group and of course executive producer of 0:00:23.760 --> 0:00:26.360 Shark Tank. Barbara Great having on the program, Thanks so 0:00:26.440 --> 0:00:27.520 much for joining us. 0:00:28.120 --> 0:00:29.720 I want to ask you, thank you very much. 0:00:29.800 --> 0:00:32.600 I want to ask you about your advice to small 0:00:32.640 --> 0:00:35.720 business owners. They come to you time and again for 0:00:35.800 --> 0:00:38.600 help and growing their businesses. And we're at a time 0:00:38.680 --> 0:00:40.960 right now where it looks like the economy is growing, 0:00:41.000 --> 0:00:44.559 but the US consumer is pulling back. What are you 0:00:44.600 --> 0:00:45.920 telling these business owners. 0:00:47.520 --> 0:00:49.839 I'm telling them that someone has to get more of 0:00:49.920 --> 0:00:51.960 a fair share of the market than the next guy, 0:00:52.440 --> 0:00:55.880 and fear stands in the way, Loneliness stands in the way, and. 0:00:55.840 --> 0:00:59.520 It it erodes people's confidence. This always business to be had, 0:00:59.560 --> 0:01:00.760 Why s you have it? 0:01:01.000 --> 0:01:03.200 So I'm getting them to be more aggressive and more 0:01:03.240 --> 0:01:05.200 confident in reaching out, and. 0:01:05.200 --> 0:01:07.880 Of course Barbara on Bloomberg. We talk about the FED 0:01:08.000 --> 0:01:10.680 all the time. We talk about high interest rates all 0:01:10.720 --> 0:01:13.319 the time. Matt has made the point just this morning 0:01:13.360 --> 0:01:16.319 that even if the FED cut rates in September, that's 0:01:16.360 --> 0:01:18.000 going to work with a lag. You're not going to 0:01:18.040 --> 0:01:21.360 feel that immediately in the economy. What is the on 0:01:21.400 --> 0:01:24.520 the ground view, the on the ground perspective that you're 0:01:24.520 --> 0:01:28.080 hearing about how high interest rates are filtering through down 0:01:28.120 --> 0:01:29.320 to small business owners. 0:01:30.920 --> 0:01:33.040 Over the last six months, it's been nothing but a 0:01:33.080 --> 0:01:35.560 series of complaints. I almost put my phone on mute 0:01:35.600 --> 0:01:37.840 when I get a call from someone. But in the 0:01:37.920 --> 0:01:41.120 last month, I would say, once people have passed the fear, 0:01:41.160 --> 0:01:44.880 people are feeling more optimistic. My very tiny entrepreneurs have 0:01:45.000 --> 0:01:47.840 just started within the last year a feeling more optimistic 0:01:47.880 --> 0:01:51.200 because they're greatly affected by business loans and they're expecting 0:01:51.560 --> 0:01:54.960 rates to come down somewhat, so they're feeling more optimism. 0:01:55.040 --> 0:01:57.080 I would say overall across the board. 0:01:57.520 --> 0:01:59.800 When you think across the board as well, and you 0:01:59.800 --> 0:02:02.240 think but the cost that business owners are still struggling with, 0:02:02.440 --> 0:02:05.120 it's everything from real estate costs. As you know very 0:02:05.240 --> 0:02:08.840 very well this industry. It's also still wondering about where 0:02:09.040 --> 0:02:12.359 labor goes from here, What are the biggest challenges you're 0:02:12.360 --> 0:02:15.000 seeing that they have, and who do you think comes 0:02:15.040 --> 0:02:15.720 in to fix it? 0:02:17.880 --> 0:02:19.560 The only one who could fix the business as the 0:02:19.720 --> 0:02:23.160 entrepreneur themselves. That's why our webinar series sponsored by AT 0:02:23.240 --> 0:02:26.240 and T Business is so valuable because we give a 0:02:26.320 --> 0:02:29.799 lot of practical answers and examples and into a lot 0:02:29.840 --> 0:02:32.320 of people who are doing it right. Really, the only 0:02:32.400 --> 0:02:34.560 thing that gets in the way of a business moving 0:02:34.639 --> 0:02:38.080 forward is really thinking that it's a time to be afraid. 0:02:38.480 --> 0:02:40.359 But what I have learned in business, every time I 0:02:40.480 --> 0:02:42.480 moved my own business ahead, it was in the worst 0:02:42.480 --> 0:02:45.399 of times that everybody was an aasayer. Because when those 0:02:45.480 --> 0:02:49.320 times hit, everybody's laying low and everybody's afraid to move ahead. 0:02:49.360 --> 0:02:51.640 And that's when you can actually. 0:02:51.280 --> 0:02:54.880 Grab the basis of customers from your main competition if 0:02:54.880 --> 0:02:58.000 you care to, because this great opportunity all around that 0:02:58.040 --> 0:02:59.040 you could take advantage of. 0:03:00.400 --> 0:03:02.720 We talk about interest rates now as if they are 0:03:03.600 --> 0:03:06.160 sky high, and we've never seen anything like this. You know, 0:03:06.560 --> 0:03:12.720 seven percent mortgage rates. You crazy became famous, made your fortune, 0:03:12.760 --> 0:03:15.600 started your career in real estate at the time when 0:03:15.720 --> 0:03:16.720 rates could. 0:03:16.520 --> 0:03:17.440 Get much higher. 0:03:17.480 --> 0:03:20.040 What do you tell people who are worried about you know, 0:03:20.160 --> 0:03:24.520 rates at this level, you know, paralyzing transactions. 0:03:26.480 --> 0:03:28.919 It's really a waste of time to spend a minute 0:03:28.960 --> 0:03:31.160 worrying about it. The only thing that counts in growing 0:03:31.200 --> 0:03:32.840 up business is what can you do about it? And 0:03:32.919 --> 0:03:35.360 certainly you have no control over the rates. But I 0:03:35.400 --> 0:03:39.400 do remember when interest rates were eighteen percent and everybody 0:03:39.520 --> 0:03:41.920 was afraid of buying, except the super rich, because they 0:03:41.960 --> 0:03:44.080 had the capital behind them to go out there and 0:03:44.120 --> 0:03:45.840 pay all cash for anything they wanted. 0:03:46.080 --> 0:03:47.000 They took advantage. 0:03:47.040 --> 0:03:49.400 You got thirty percent discounts on the market rate of 0:03:49.400 --> 0:03:52.000 a year before the price rate of a year before. 0:03:52.480 --> 0:03:55.120 I tell people that whenever there's a change in the 0:03:55.560 --> 0:03:58.840 in the making a business and everybody's afraid, just have 0:03:58.960 --> 0:04:01.200 to look around and see where you could take advantage of, 0:04:01.240 --> 0:04:03.640 where you could go in and scoop something out. At 0:04:03.680 --> 0:04:06.680 that time, when interest rates were eighteen percent, I remember 0:04:06.720 --> 0:04:09.520 making the actual decision in one day to switch my 0:04:09.600 --> 0:04:12.200 business halfway out of sales and go into rentals to 0:04:12.320 --> 0:04:13.320 move with the market. 0:04:13.560 --> 0:04:15.440 But it's funny how not even. 0:04:15.240 --> 0:04:18.760 Funny, but it's sad how entrepreneurs get stuck with their 0:04:18.839 --> 0:04:21.080 old reality of what they specialized and. 0:04:21.040 --> 0:04:23.280 What they're good at. I learned. I learned the rental 0:04:23.279 --> 0:04:26.520 market right away because I had to. There were no sales. 0:04:27.040 --> 0:04:29.280 Well, to use a personal example when it comes to 0:04:29.320 --> 0:04:32.120 real estate, I tried to buy a house an apartment, 0:04:32.480 --> 0:04:35.160 and the interestrars are just too high. And my bet 0:04:35.200 --> 0:04:37.240 there was, Okay, I'll just wait a couple of years, 0:04:37.279 --> 0:04:39.680 sign another multi year lease and then hope on the 0:04:39.720 --> 0:04:43.040 other side that rates will be lower. How much pent 0:04:43.200 --> 0:04:45.520 up demand do you think is on the other side 0:04:45.800 --> 0:04:47.480 of lower mortgage rates from here? 0:04:49.600 --> 0:04:53.200 Tremendous demand because there are so many people thinking exactly 0:04:53.240 --> 0:04:56.000 as you are. And if you would take my advice, 0:04:56.080 --> 0:04:58.159 I would say get out there because what you have 0:04:58.320 --> 0:05:00.360 right now, which you won't have if rates come. 0:05:00.200 --> 0:05:01.000 Down another point. 0:05:01.040 --> 0:05:03.480 They just came down, but you need one more point 0:05:03.560 --> 0:05:05.640 to bring everybody out into the market. 0:05:05.800 --> 0:05:07.360 And what's going to happen is you're going to pay 0:05:07.360 --> 0:05:08.080 more for the house. 0:05:08.320 --> 0:05:10.600 So what have you really gained by paying the landlord 0:05:10.680 --> 0:05:13.520 over these years and taken the increases in rent? 0:05:13.720 --> 0:05:15.600 Not much because price have gone up. 0:05:15.839 --> 0:05:18.039 But wait, do you see what happens with prices when 0:05:18.080 --> 0:05:20.200 interest rates come down another percentage point. 0:05:20.440 --> 0:05:24.680 Well to that end also, right, you know, interest rates 0:05:24.680 --> 0:05:26.720 go down, prices go up, And at the end of 0:05:26.720 --> 0:05:29.320 the day, how much, Barbara, do you worry about housing 0:05:29.400 --> 0:05:31.080 affordability in this country. 0:05:32.560 --> 0:05:34.680 I worry about it all the time on two fronts. 0:05:34.720 --> 0:05:37.560 Rents keep going up anywhere in the United States, and 0:05:37.600 --> 0:05:40.479 that's a real concern because people can afford the rents 0:05:40.520 --> 0:05:43.360 based on their income. And I also worry much more 0:05:43.440 --> 0:05:45.960 so about people getting their piece of the American dream 0:05:46.279 --> 0:05:49.120 buying their first house, because the first house market, the 0:05:49.160 --> 0:05:52.239 story house market, is the hardest hit where the greatest 0:05:52.240 --> 0:05:56.400 bidding is going on. I even I had the daughter 0:05:56.480 --> 0:05:59.000 or a friend of mine tell me that last week 0:05:59.080 --> 0:06:01.240 she was competing again. Are two best friends in the 0:06:01.279 --> 0:06:04.200 New York market. It's crazy and she's going to have 0:06:04.200 --> 0:06:07.000 to invite them for dinner parties after. So it's this 0:06:07.200 --> 0:06:09.960 so much competitive bidding, so much going over the price, 0:06:10.080 --> 0:06:13.240 and so much fear going around because people feel like 0:06:13.320 --> 0:06:15.720 can't get a head no starter. Prices are a real 0:06:15.760 --> 0:06:18.160 problem in America and they're going up everywhere. 0:06:18.520 --> 0:06:18.839 Barbara. 0:06:18.839 --> 0:06:21.320 I want to get back to the small businesses you're 0:06:21.360 --> 0:06:24.120 helping out, you're working with at and t business talking 0:06:24.160 --> 0:06:28.640 about technology driven solutions. That immediately makes me think of AI, 0:06:29.360 --> 0:06:33.120 artificial intelligence, and I wonder, you know, given that you've 0:06:33.200 --> 0:06:36.039 seen the real estate market and business move through the 0:06:36.160 --> 0:06:40.080 Internet age, what's your take on this new, uh, you know, 0:06:40.120 --> 0:06:42.080 supposedly revolutionary technology. 0:06:43.839 --> 0:06:46.200 Well, it's a very good parallel you draw because I 0:06:46.279 --> 0:06:48.160 remember the days when I went on the Internet, and 0:06:48.200 --> 0:06:50.920 I was the first, over two years before my competitors 0:06:51.240 --> 0:06:53.200 went on, and what an advantage it was. 0:06:53.440 --> 0:06:55.919 But I had one magic thing. I wasn't afraid. 0:06:56.360 --> 0:06:59.839 What's stopping people using AI? And with so much chatters 0:06:59.920 --> 0:07:02.120 or around it, I'm sure you've sensed it is that 0:07:02.200 --> 0:07:04.400 people are afraid of it. But it's really like a 0:07:04.520 --> 0:07:07.160 muscle that you have to use and exercise. And it 0:07:07.200 --> 0:07:09.840 doesn't even take as much muscle as getting into the 0:07:09.880 --> 0:07:12.960 Internet took, which was rather complicated for a lot of 0:07:12.960 --> 0:07:15.920 small businesses. All you have to do is schedule ten 0:07:15.920 --> 0:07:18.480 minutes a day and just fool around with it and 0:07:18.560 --> 0:07:21.760 you start to learn, excuse me, AI and how you 0:07:21.760 --> 0:07:24.480 can use in your business. It's the single best thing 0:07:24.520 --> 0:07:27.120 that has affected small business and that's why we made 0:07:27.120 --> 0:07:29.960 it a topic of our third at and T seminar 0:07:30.280 --> 0:07:33.680 because people need to know how they could use a 0:07:33.680 --> 0:07:37.080 pardon me a one to save costs of hiring people 0:07:37.120 --> 0:07:39.840 that they get for free now by using AI, they 0:07:39.920 --> 0:07:41.560 used to have to contend with the payroll. 0:07:41.800 --> 0:07:43.920 Who do I hire? AI does all the. 0:07:43.880 --> 0:07:47.000 Grudge work today for every small business I'm going to 0:07:47.040 --> 0:07:48.480 change your attitude or AI. 0:07:49.040 --> 0:07:50.720 Well, I want to talk about the attitude a little 0:07:50.720 --> 0:07:52.520 bit more before we let you go, because we're talking 0:07:52.520 --> 0:07:55.560 about fear among small business owners. There's a lot of 0:07:55.560 --> 0:07:57.880 ways to get scared about AI. When you think about 0:07:58.000 --> 0:08:01.400 robots replacing all of our I mean, how do you 0:08:01.480 --> 0:08:04.120 get past that fear and actually change the attitude? 0:08:05.760 --> 0:08:07.880 Well, I have to say people who get past the 0:08:07.920 --> 0:08:10.520 fear are not the people who are employed, but the 0:08:10.520 --> 0:08:13.320 people who should have no fear other people who employ them. 0:08:13.640 --> 0:08:16.080 Because before you do that next hire that you think 0:08:16.120 --> 0:08:18.920 you have a need for someone, you try AI. They 0:08:19.120 --> 0:08:22.760 will answer your needs. So there's really a no fear 0:08:22.840 --> 0:08:24.960 or shouldn't be fear on the part of the business owner. 0:08:25.280 --> 0:08:27.880 All right, Barbara, So don't forget the seminar you could 0:08:27.960 --> 0:08:29.920 find on eight A eight Barbara dot com. 0:08:29.960 --> 0:08:32.240 I have to get that in sponsored by AT and 0:08:32.280 --> 0:08:32.880 T business. 0:08:33.240 --> 0:08:35.760 I respect it. You got that plug in. Barbara really 0:08:35.880 --> 0:08:38.400 enjoyed this conversation. Hope to have you back soon. That, 0:08:38.480 --> 0:08:40.280 of course, is Barbara Corcoran.